Frequently Asked Questions

Here you will find answers to common questions related to buying and selling businesses.

Our FAQs are categorized to help you navigate through the information easily.

For Sellers

Preparing for Sale

How to prepare my business for sale?

We guide you through every step: organizing accounts, improving operational efficiencies, updating your business plan, reducing unnecessary expenses, strengthening your customer base, understanding buyer expectations, preparing teasers, and handling final negotiations.

Why should I start preparing for a business sale early?

Early preparation addresses potential issues, enhances business value, and ensures a smoother, quicker sale process. Having an exit strategy prepares you for future opportunities and challenges, making the eventual sale more advantageous.

When do you need to pay for business valuation before selling?

An accurate valuation is crucial for ensuring you get a fair price and attracting serious buyers. However, in most SME sales, a detailed valuation report isn’t always necessary. Learn how to value your business here.

How long does the M&A process typically take?

The M&A process typically takes 6 to 12 months, depending on the complexity of the transaction and the readiness of both parties. We ensure a streamlined, efficient approach for timely success.

Confidentiality and Negotiation

Why is confidentiality crucial in the M&A process?

Confidentiality protects your sensitive information and preserves your market position. It also ensures that the sale process doesn’t disrupt your ongoing operations. Additionally, understanding market trends and knowing your buyers are crucial for successful negotiations. Learn negotiation strategies here.

How to negotiate for the best price for my business?

Start by understanding market trends and competition. Know your buyers and highlight the factors they prefer. This will help you negotiate effectively. Learn more here.

What should I expect during the due diligence process?

During due diligence, expect a thorough review of your financials, legal matters, operational processes, and market position. This helps buyers verify the information provided and assess any risks involved.

Buyer Screening

Why is buyer screening important when selling my business?

Screening buyers ensures that only serious, qualified buyers are considered. This reduces the risk of deal fall-throughs and saves time. It also helps buyers and brokers understand your industry better.

Who are the ideal buyers or investors for my business?

Ideal buyers have the financial capability and industry experience to ensure a successful transition. Learn more about different types of buyers here.

Common Pitfalls

What are some common pitfalls to avoid when selling?

Lack of preparation and organization
Overpricing or underpricing your business
Poor communication
Unnecessary delays that could lead to deal fall-throughs

When should my employees, customers, and suppliers know about my intention to sell?

Inform key employees first, as they play a crucial role in the transition. Inform customers and suppliers after a sale agreement is signed to minimize disruption.

Working with Strategix Asia

How can I start working with Strategix Asia?

Book a consultation session with us to get started. Provide historical financial statements and organizational structure details. Our engagement is tailored to your needs, beginning with a thorough assessment and a customized M&A strategy. We provide end-to-end support.

Does Strategix Asia provide legal advice during the M&A process?

We work with legal advisors to ensure compliance and manage legal aspects, but we do not provide direct legal services.

For Buyers

Acquisition Strategy

Why is a clear acquisition strategy important?

A clear acquisition strategy ensures your goals and criteria are met, making the search and evaluation process efficient and aligned with your objectives. Click here to view projects.

What should I look for in a business acquisition advisor?

Look for advisors with a strong track record, relevant industry experience, and a clear understanding of your business goals. They should offer comprehensive services, from due diligence to negotiation and closing.

How can I finance the purchase of a business?

Financing options include personal savings, bank loans, seller financing, or seeking investors. Each option has its pros and cons, and it’s crucial to choose the one that aligns with your financial situation and business goals.

What are the benefits and risks of seller financing?

Seller financing can make the purchase process smoother and more flexible, but it also requires a thorough assessment of the seller’s credibility and the business’s cash flow to ensure repayments can be made.

Evaluation

What are the key factors to consider when evaluating a business for purchase?

Consider the business’s financial health, market position, customer base, competitive landscape, and potential for future growth. Assess the business’s operational structure and any existing liabilities.

Why is it important to understand the seller's motivations?

Understanding seller motivations reveals business strengths and weaknesses, aiding better negotiation and identifying opportunities or challenges. Learn more about motivated sellers here.

How can I assess the potential growth of a business?

Evaluate the business’s market position, competitive landscape, customer base, and industry trends. Consider the business’s scalability and potential for innovation.

Risk Mitigation

How can I mitigate risks when buying a business?

Conduct thorough due diligence, understand the industry, assess the business’s financial health, and consult with legal and financial advisors. A well-structured purchase agreement that includes contingencies can also help mitigate risks.

Why is due diligence important when buying a business?

Due diligence uncovers potential risks, ensuring informed decisions and avoiding costly surprises post-acquisition.

What are the key legal considerations when buying a business?

Key legal considerations include understanding existing contracts, liabilities, regulatory compliance, and any potential legal disputes. It’s crucial to consult with a legal advisor to navigate these issues.

Why should I get a business valuation before making an offer?

A business valuation clarifies the business’s worth, helping you make a fair, competitive offer reflecting its true value.