Denver Business Acquisitions & Brokerage Company - Selling Businesses for Sale

Purchasing a Business

Where Do You Start? Business transfers are evolving. Unless you’re a veteran of business transfers, you'll find that buying a business can be a frustrating experience.  That's why it’s important for you to take the time to read this explanation of our process.  Although every business is unique and has its own challenges, we’ve found that working within these guidelines greatly increases your ability to understand and get through the process. Even if you're a veteran of business transfers, understanding our process will assist you in the purchase of a business.

The First Steps. You may have found a MillsBA listing through a website like ours, but we don’t limit our listings to our own website, we advertise on many sites. These ads are intentionally “blind”, so as to protect the confidentiality of our sellers.  You’ll need to fill out our Confidentiality Agreement AND a Buyer Profile before we can give you any more detailed information about the business(es) in which you’re interested. The first important step is telling us about you.  Filling out the Buyer Profile gives us the kind of information we need to get started to help you the most.  How many days per week are you comfortable working?  Do you like having employees?  How much cash do you have for a down payment?  We're not just asking, we're narrowing your search and saving you time and aggravation.

The Business Summary. Our Sellers need to continue to focus on their business with as few distractions as possible and our Buyers need enough information to make an educated offer.  We accomplish this in several ways.  The most important element in this process is the Business Summary.  A typical Business Summary and a Video Presentation, which you’ll have access to once you’ve qualified, contains a detailed description of the business.  After a thorough review of the Business Summary and discussions with us, you should have a good understanding of the business and its operations. Now, you should be prepared to make an offer for the business or discuss another business acquisition.

Making An Offer. So, now you’ve decided to take the plunge and make an offer. But before you get too anxious, remember that making an offer is not the final step. In fact, it should be viewed as the first of several steps, each of which bring the Buyer and Seller closer to completing the transaction.  Since this is a privately held business, the Buyer is obligated to make an offer before seeing the business' detailed financial records.  The Buyer must understand that their offer is always Contingent upon the Seller proving his or her representations.  Due diligence is costly and time-consuming, and it must be done only after an agreement on price and terms is reached.  It's the Seller's responsibility to prove everything to the Buyer.  In another words, your agreement on price and terms will be non-binding, until you've had the opportunity to see all financial records and we’ve removed all contingencies.

The Offer. Terms, Contingencies & Conditions. Your Purchase Asset Agreement will consist of the following:  Terms, Contingencies, Conditions, your resume of business background and experience, your financial statement and credit report (paid for by you), and your Earnest Money deposit check in the amount of 10% of the offered price.  This check is not deposited until there is an agreement signed by both the Seller and the Buyer.  After that, your check will be deposited in an FDIC-insured Escrow account.

Due Diligence: Removing Contingencies. You and your advisors will have a specified period of time to complete your due diligence and remove the contingencies (typically 10 days). When due diligence is complete and the contingencies are removed, the contract is binding. Should the business fail to pass due diligence, you are free to rescind or amend your Purchase Asset Agreement.

Financing. Working with Sellers and the SBA. Most businesses that are for sale need some form of financing. We work with Buyers to help them obtain the needed financing for the business being purchased. This is accomplished frequently by a Seller’s Note or bank loan guaranteed by the Small Business Administration. But whatever the financing requirements, Buyers can expect guidance and assistance from MillsBA.

Escrow & Closing. Escrow can vary, but 3-4 weeks is common. After Escrow receives the signed instructions, the escrow officer will contact government tax agencies for clearance and publish your fictitious name filing, enabling you to open business and banking accounts. Also, during this time, a Notice To Creditors will be published, allowing anyone with a claim against the business to step forward.

The Finish Line. Congratulations. Finally, You’re In Business. All your due diligence has paid off. There’s no better feeling than knowing that you’re in control of your destiny.