The business selling process - simplified!

For most business owners one of the biggest questions is "what is the business sale process?"


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Whether you are ready to sell today or planning for a future sale, then PLANNING is the key. We need a clear understanding of what you do, the history and the performance of the business as well as its future prospects. We can advise on aspects of your business including what might hinder the sale and provide strategies to mitigate possible issues. 

Normalise financial statements

When you market your business for sale your tax accounts don’t give a true reflection of the performance of the business.

So normalising your accounts for sale purposes involves adjusting the accounts by adding back interest on debt that won’t transfer, one-time non-recurring expenses and to remove benefits accruing to the owner that aren’t related to the actual operation of the business. We recommend that this be completed in conjunction with your accountant so all parties are in agreement and we are in a position to verify add backs to a new purchaser.

Provide opinion of market price range

In accordance with our obligations under the REAA 2008 ACT we prepare a written appraisal of the business utilising accepted valuation methodologies which includes a market comparison to other similar businesses that have been sold recently. You as the owner are under no obligation to accept our appraised value and we welcome your feedback.

Obtain authority to sell

This agreement authorises NZ Business Brokers to act on your behalf. It outlines our fee structure and both parties’ responsibilities.

Prepare business information memorandum (IM)

This IM document is made available and only released to qualified buyers and their advisors who have completed a confidentiality agreement. It is very important that the IM is a true representation of your business. It provides preliminary information on your business enabling purchasers to determine whether it fits their buying criteria. We prepare the IM on your behalf and you as the business owner sign off to verify that the information is true and correct. This is all done prior to taking the business to the market.

This document is not expected to sell the business but gives a potential purchaser enough information to get an understanding of the business and decide whether they persue the opportunity further and request more in-depth information.

Marketing programme

Any marketing that is undertaken will not identify your business (unless agreed upon). NZ Business Brokers uses a multi-faceted approach. We have a wide range of options in taking your business to the market such as NZ Business Brokers database of qualified buyers and our website,,, Facebook, LinkedIn and more.

We will develop a marketing plan based on what are the most suitable channels.

Screen responses

Initial discussion with interested parties to ascertain whether the business fits their buying criteria, fits their budget.

We only want to expose the business to pre-qualified buyers.

Sign confidentiality agreement

This is obtained from all purchasers before we provide any information that could identify your business.

Qualify buyers

We continue the process  of ensuring that the buyer has the financial resource, business experience and commitment to complete the transaction. Our brokers use their experience to qualify buyers to ensure that are genuine.

Present information memorandum

Qualified buyers are provided with the IM (which you as the seller have approved). This can either be at a face to face meeting,  video-conference call or a buyer who has been vetted via email.

Determine buyer interest

Once the purchaser has reviewed the IM we follow up to identify their level of interest and potential purchase.  

Vendor-Purchaser meeting

The Vendor Purchaser meeting is an important step in the process because it allows the buyer to hear the owner’s story directly and gives the buyer a better understanding of the owners personality and motivations. Generally this meeting is held outside of the business, so as not to disrupt the business. If a site visit is required this is usually arranged after hours if the owner feels that the staff could grow suspicious with the owner walking around with different people through the process.

Provide further business details

As a result of the initial meeting, the purchaser will have a list of questions to be answered. We will pass these on to you when/if required.

Negotiate offer from purchaser

This will generally be in writing as a Sale and Purchase Agreement or a Heads of Agreement. The agreement sets out all the terms and conditions of the offer and will always be dependent on the purchaser completing due diligence to their satisfaction. In most cases we will look to have more than one purchaser proceed to offer stage. This triggers a multiple-offer process and allows the owner the choice of the buyer who he/she considers most likely complete the transaction.

Facilitate negotiations

NZ Business Brokers will lead the negotiations on your behalf to ensure you receive a premium price for your business. You will be advised to seek the relevant legal and accounting advice from your other advisors.

Complete sale and purchase agreement

Once both parties have signed the contract there are now various conditions that need to be satisfied.

Agreements to solicitors

Each original contract is sent to the respective solicitor.

Conditions to be satisfied

The contract is typically conditional on due diligence, finance and if a lease is involved, upon obtaining the landlord’s consent for the assignment of the lease. NZ Business Brokers is involved in all stages of this process and will liaise with professional advisors to ensure that all conditions have been satisfied.

Due Diligence

Due diligence is the process where the purchaser along with their advisors-accountants and solicitors will examine the business in  detail. This usually involves an audit of the company’s financial and non-financial position and performance. Until this stage most of the information provided has been accepted on its face value. The purchaser is now looking to verify the information. It is important this information is readily available.

NZ Business Brokers works closely with all parties to facilitate this process, ensuring that any confidential information is protected and that the day-to-day operation of the business is not disrupted.

Confirm unconditional

The contract is typically declared unconditional in writing by the purchaser’s solicitor, and both parties must honour the agreed transaction.

Deposit into trust account

Once the contract is declared unconditional, NZ Business Brokers will ensure the deposit is paid into their audited NZ Real Estate Trust account and be dispersed according to the relevant law.

Settled sale

During the period between when the contract is declared unconditional and possession takes place, both parties and their accountants and solicitors will attend to any financial and legal requirements that need to be finalised. A stock take, (if stock is a component of the business), is usually completed before settlement and the settlement sum adjusted to reflect the value of stock (stock is calculated at cost price with any adjustment made for old and obsolete stock).

Seller’s assistance

The Vendor will generally be required to assist the new owner in the running of the business for an agreed period of time (usually up to four weeks), payment for this period is included in the purchase price. If assistance is negotiated beyond this period it is at an agreed rate of compensation and accounted for in the negotiations of the Sale and Purchase Agreement.

To a first time seller the above process can be overwhelming without the assistance of an experience broker, however we have been involved in hundreds of successful sale transactions and are able to guide you through the process. 

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