Selling up
Businesses get sold for different reasons. Their owners might want a change, to make a profit on the business or to retire.
Some people start a business with a plan to sell it after a few years.
Selling a business is a specialist area so getting help from a suitably experienced budget advisor or business broker is a good idea.
They’ll be able to:
- advise you on how to prepare for your sale
- help find and negotiate with potential buyers
- value your business.
Closing your business
Businesses might close when times are tough or because their owners want a change.
Two important things to do are:
- Make sure you have a clear picture of your finances, so you can see your options.
- Talk to a budget advisor. Give them information about your finances and business so they understand your situation. They might be able to suggest other options.
If you want to close because of money troubles, doing one or more of these things might help:
- change your budget
- talk to creditors, including Inland Revenue
- combine several debts into one, to better manage what you owe
- change your business model
- get funding (if you have a solid business plan).
If you want to close because you want a change, you could consider selling your business or stepping away.
Closing for reasons beyond your control
Sometimes businesses close because they are insolvent: they can’t pay their debts on time, or they owe more than they own.
Several things can help:
- Work out your total debt, so you know how long you’ll need to pay it off and what options you have.
- Get advice from an accountant, lawyer, or budget advisor .
- Contact the people you owe money to and discuss ways you might be able to repay.
If a business is a company, it could go into involuntary closure like liquidation or receivership.
This means some of its assets could be sold to pay off debt.
Stepping away
If you’re ready to move on, you could sell or close your business, or pass it to someone else.
For example, you could do one or more of these:
- pass your business to your children or a business partner to own or manage
- stay connected by holding onto a share in the company
- stay connected by continuing to offer advice.
Whatever you choose, careful planning is essential. Getting advice from an advisor who specialises in succession planning could be a good idea too.
What's next
Starting a business
Growing your business
Maintaining your business
Dealing with tough times
Company
Partnership
Sole trader
Contractor
Social enterprise (doing business for good)
Other business structures