What To Do After The Sale Of Your Business
By David Annis

Selling a business can be a life changing event. Depending on the deal, you may suddenly have a lot more money and free time. So what do you do now? A beach on a tropical island may be nice for a while, but before you go there are tasks that you should do which are rarely discussed in the industry literature. I ve made a checklist of things to do after the sale. A little time invested right after the sale may allow you to avoid a great deal of trouble later.

Make sure that you thank your employees. They have enabled your success and who knows, one day you may need their goodwill for something (a job reference, collecting a receivable).

If there is an adjustment made to the sale price based on inventory levels, make sure that the inventory is counted right before or immediately after closing.

Don t forget the petty cash box. Empty it right after the sale if there was an asset sale and you did not include cash in the sale price.

Help the new owner smoothly handle the transition with your clients. Remember that the clients belong to the new owner now, you need to let the new owner decide how to handle it. You need to do your best to make it successful, but how it s handled is the new owner s decision.

Sit down with a competent financial planner if you have not done so already. Your business was hard to build, so don t throw the money you ve just earned away by taking unnecessary risks and paying high fees.

Remove your name from any personal guarantees. Often when signing a contract for the business, an owner gives a personal guarantee. I ve seen an owner get hit up for collection on a contract for high speed internet lines over three years after a sale based on a personal guarantee given as part of a contract that was signed a year before the closing.

Collect receivables that you have retained as soon as it is practical to do so. Receivables get harder to collect as they age.

Pay any accounts payable for which you are responsible.

Distribute any cash or bank balances that were not included in the sale.

File a final tax return for the company.

Finally, dissolve the corporation.

David Annis is one of the founders of Valuations, LLC whose websites include:
Guide To Selling A Business provides information and tools to allow you to sell your business with or without a broker,
Free Valuations Online Business valuations with downloadable reports,
and Business Broker Locator Get up to four offers from pre-screened business brokers based on your company s specifics.

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