When do you stop marketing your business when you have a potential buyer?

When do you stop marketing your business when you have a potential buyer?

This is something that often comes up with our clients and potential clients. You have a (potential) buyer who is making all the right noises and you think you’re going to sell your business. In fact they have even made an offer on the business and you have agreed to sell them the business. So can you stop marketing now? To understand this it is first good to understand the next stages in a sale.

Once you have an agreed offer for your business the next steps are:

1) Appoint solicitors

2) Deposit of 10% paid into the solicitors trust account by the buyer

3) Draft contract agreed by both solicitors

4) Contract signed by both parties and deposit paid.

5) Due diligence and trial period (if required) will then commence (generally 1-2 weeks).

6) Lease transfer – handled by the solicitors

7) Settlement date – set by the solicitors. Appointing solicitors is a good sign that the buyer intends to proceed, paying the 10% deposit gives them more credibility as they now have skin in the game.

However the business is not sold until final settlement and you have received full payment.

So keep marketing until this occurs. The buyer knowing that there are potential other buyers keeps them incentivised to complete the transaction, it keeps them honest. Also if the buyer were to step away, you will have other buyers looking at your business and this could save you months.