Consider this when selling your business

Selling a business is no easy task.

Many factors must be taken into consideration, not the least of which is price.

Other issues include:
-what is being sold—assets, equity?
-How to value the business?
-Tax implications?
-Family or key employee considerations?
-Will the current workforce be asked to stay on or will there be cuts?

It is essential to have a good team advising the business owner—for sure to include an attorney and accountant. Over and above these individuals, thought may be given to including industry professionals and trusted confidants.

We are sometimes asked about what happens to a firm’s Blue Book rating when a business is sold. The short answer is: typically, a rating is not part of a sale.

Here is why: a rating is earned by the principals of a business—owners or those considered to be responsibly connected in the running of a business (corporate officers). If a firm is sold by one owner to another (ex., a 50% owner sells to the other 50% owner), the rating may continue.

However, when a third-party purchases a business, the rating does not follow. The new owner(s) must start from scratch in earning a Blue Book rating.

As has been written about, the name of a business may go with a sale, but not the Blue Book rating.

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