Corporate sales process in 5 steps

Selling a business is a unique process; no two sales processes are the same. The course of a sales process depends on many factors such as the industry, the size of the business, financing options, buyer and seller preferences and so on. Despite the infinite differences, a fixed structure can often be identified in the course of a sales process. We will explain this structure and break it down into 5 clear steps. This way every seller knows what to expect during the sales process.

The sales process in 5 steps: 

  1. Starting the business sale and exploring the market
  2. Agreeing on price perception 
  3. Due diligence 
  4. Preparing the sales agreement
  5. Handling the sale and transferring the business

These steps sound logical and simple yet many sellers run into questions such as "when there are multiple interested parties, how do I handle this?", "what information do I share at what time?" and "how do I draft an agreement?". For each step, we will share as much practical information as possible about what you may encounter while selling your business. 

 

Bedrijf verkopen in 5 stappen

1. Starting the business sale and exploring the market 

The sales process begins with exploration of the market; how many buyers are interested in your business, who are these buyers and where can these buyers be found. This is where we, Businessforsale.eu, and our extensive network play the biggest role. We place your company profile on our offer page and will bring the profile to the attention of as many buyers as possible. The buyers who respond via Businessforsale.eu are possibly interested in an acquisition. This gives you as a seller a good feeling about the level of interest. When the seller receives responses it is time for exploration whether there can be a good match with a buyer. 

The process of selling starts here for the seller. Messages arrive in your inbox on the Businessforsale platform. The content of these messages can vary. Most buyers will give a brief introduction and ask some general questions. Which questions you can answer immediately or which answers are better shared after introductions are explained in detail in this article. The most important thing in the introduction phase is to give the buyer a good picture of the company but in doing so not to disclose your competitive advantages. We therefore recommend keeping valuable information in terms of your runners and suppliers still to yourself. This can be shared at a later stage of the sales process.  

Buyer questions that can be answered often concern the following topics: historical sales figures, historical profit figures, visitor statistics, marketing channels used, etc. Based on this information, buyers can form a good picture of the online business. To be well prepared, it is advisable to go through this list of buyer questions. Good preparation will speed up the sales process considerably.

2. Price perception agreement

Seller and buyer will probe during introductions to see if, in addition to enthusiasm about the business, they can agree on the asking price. It is common for some negotiation to take place, as the value of a business remains a perception even after an extensive valuation. The intended goal is that both buyer and seller can look back on the business acquisition with a smile. 

When several interested parties come forward, the seller can work with bids. By drawing up a term sheet, buyers can make known for how much and with what financing means they would like to take over the company. Based on the term sheets, the seller can give preference to a potential buyer and enter into a period of exclusivity with this party.

Experience shows that the highest bidder need not be the best buyer. It is therefore advisable to plan an (extensive) introduction to all bidders. We often see that a personal click between buyer and seller is a better basis for a good deal than just going for the highest bidder. A personal click and trust between buyer and seller is fertile ground for a fast and smooth sales process. 

3. Due diligence

The sales process, after agreed price perception, moves on to a next phase: the due diligence. During the due diligence fase, the buyer gains access to the information shared by the seller. The buyer can validate this information and form an accurate picture of the business. How to prepare for a due diligence as a seller can be read here.

Unique to the sales process of e-commerce companies is having online visitor statistics in stock. When a Google Analytics account is linked to the website, all statistics, from the number of visitors to demographic details, can be viewed. Sellers can create a "view only" account for interested buyers. This way, a buyer can look around in the selling party's Google Analytics without being able to make any adjustments. 

For sellers, this step in the sales process can be exciting; the buyer gets a sneak peek without a guaranteed deal. To reduce this understandable uncertainty as much as possible, a letter of intent, also known as a Letter of Intent (LOI), can be used. An LOI confirms the intention to enter into a deal together and under what conditions. Does this sound appealing to you? Then read about the LOI here. We also offer an LOI template, which is easy to download and customize to your specific sale.

4. Preparing the sales agreement 

The next stage in the sales process, after positive findings in the book review, is to draw up the acquisition agreement. Via Businessforsale.eu there are standard agreements available for download, specifically aimed at online businesses. These templates focus on different transaction types such as a share transaction or asset-liability transaction, with or without employees. Here you can read more about the type of transaction and its implications on your company's sales process.

Do you need additional support in drafting the sales agreement? Then choose our 'lawyer check' while downloading the standard agreement. Our partner lawyer will review the drafted agreement and indicate where adjustments may be needed. A check from an expert is recommended to conclude the sale of your business with confidence.  

5. Completion of the sale and transferring the business

The deal is done, the sales process is almost complete except for 1 step; the practical acquisition. The final step of the sales process is transferring the necessary systems, inventory and login information. Here are some points that often occur when selling an online business. 

The practicals of selling an e-commerce company: 

  • Transfer of domain name registration
  • Adjust agreement with hosting partner or hosted shop software provider
  • Transfer payment provider
  • Introduction and transfer of product suppliers
  • Share login details of social media accounts
  • Share any agreements with partners (content writers, photos etc) and make necessary introduction
  • Transfer sales accounts (Amazon, Bol.com etc.)

In addition, inventory is also transferred including descriptions of all products and quantities. 

It is common, and desirable, for the seller to be available for questions and guidance to the buyer during the initial period after transfer. The duration and extent of guidance after transfer is good to include in the agreement. We often see sellers make themselves available for x number of weeks for intensive guidance. After these initial weeks, sellers are available on an hourly basis. It is good to have this clear during the sale and to include this agreement in the acquisition agreement.