Amidst Singapore’s towing skyscrapers and bustling marketplaces lies a thriving ecosystem where businesses of all sizes and kinds grow and prosper. IMD placed Singapore in the 3rd position in the World Competitiveness Ranking 2022, considering the region’s business and government efficiency and economic performance.
The country also ranked 1st in IMD’s Smart City Index in 2021 and 3rd in Cushman and Wakefield’s Global Data Center Market Comparison 2023 for its cloud availability, market size, and fibre connectivity.
So, there is no doubt that there are endless possibilities for local SMEs to grow in this state. However, when connecting with prospective investors or selling an SME, business owners face several challenges, like establishing a digital presence or reaching out to prospective buyers overseas.
This is where online platforms for selling a business come into play to help sell a business in Singapore.
Let’s see how you can use these platforms to sell a business in Singapore.
How Do You Prepare To Sell Your Business On Online Platforms?
The first steps are critical for finding prospective investors and buyers for your business. While the process can be complex, we have simplified it for clarity and proper understanding.
For SMEs looking to sell your business on an online platform, the following steps are essential:
- Research and Choose a Suitable Platform: Find online platforms that list SMEs looking for buyers and investors. Consider the platform’s reach, reputation, fees, and the types of businesses and buyers it attracts.
- Prepare Business Documentation: Gather financial statements, tax returns, leases, contracts, and other relevant business documents. These will come in handy when making the profile on the online platform and also during due diligence.
- Business Valuation: Hire a professional appraiser or use valuation tools to calculate the valuation of your business.
- Create a Detailed Listing: Develop a compelling listing that includes a business overview, financial performance, growth potential, reason for selling, and asking price.
- Create a Secure Profile: Once you find a suitable online platform for selling your business, create a secure profile and upload all the necessary information. Ensure that only interested buyers and investors can view your profile with your permission.
- Screen Potential Buyers: Ensure potential buyers are financially qualified and serious about purchasing your business.
How do you make a proper investor presentation for pitching your business?
Once you have screened potential buyers, the next step is to create the investor presentation. This can be done simultaneously while listing your business on online platforms.
To create an effective investor presentation for selling your business, include the following key elements:
- Executive Summary: A small overview of your business, including the business model, mission, and unique value proposition.
- Company Background: History, milestones, and evolution of the business.
- Products or Services: Detailed description of your products or services, highlighting unique features, benefits, and the customer pain points it resolves.
- Market Analysis: Insights into your target market, customer demographics, market trends, and competitive landscape.
- Marketing and Sales Strategy: How you attract and retain customers, including marketing channels, sales tactics, and customer engagement strategies.
- Financial Performance: Detailed financial statements, revenue streams, profitability, and growth projections. Include past financial performance and future forecasts.
- Management Team: Bios and credentials of key team members, highlighting their experience and expertise relevant to the business.
- Operational Structure: Overview of your operational workflow, suppliers, production processes, or service delivery methods.
- Growth Potential: Opportunities for expansion, new market entry, product development, or strategic partnerships.
- Asking Price and Terms: Your valuation of the business, asking price, and terms of sale.
- Appendices: Any additional supporting documents, like customer testimonials, patents, or legal documents.
Remember, clarity, honesty, and a compelling narrative about your business’s value and potential are crucial in attracting the right buyers.
Negotiating With The Buyers
Once a prospective buyer likes your presentation and wants to take it further, you enter the negotiation phase. Usually, negotiations take place away from the online platform, as most platforms are used for listing a business and reaching interested buyers.
This part of the sale is a complex and nuanced process that begins when a potential buyer shows interest in acquiring the business.
At this stage, both parties discuss various elements involved in the sale that we will discuss in detail in this section.
Once you reach this phase, you must clearly communicate and establish your terms and conditions to avoid misunderstandings and reach a mutually beneficial agreement.
Negotiating the sale of a business involves several key steps:
- Initial Offer and Response: The buyer makes an initial offer, which the seller can accept, reject, or counter.
- Due Diligence: The buyer examines the business’s financials, operations, legal matters, etc., to ensure everything is as represented.
- Negotiation of Terms: This includes the sale price, payment terms, transition assistance, and any contingencies.
- Drafting the Purchase Agreement: A legal agreement is drafted once terms are agreed upon.
- Final Review and Adjustments: Both parties review the agreement and make any necessary adjustments.
- Closing the Deal: The final step is signing the agreement and transferring ownership.
Closing The Deal
Finalizing a business sale involves a few important steps to wrap everything up neatly.
First, you will have to sign a sale and purchase agreement with the buyer. This is like a promise where everyone agrees to the terms of the sale.
After that, it’s vital to make sure all the legal and money matters are sorted out properly. This step is important to avoid any problems in the future.
Finally, you hand over the business to the new owner. This part ensures the smooth transition so the business keeps running without any hitches. The seller might need to pass on important information, tools, or contacts to the new owner.
Online platforms are great for SME business owners to sell their companies. They let you promote your business to buyers from all over the world and increase the opportunity to sell your business. Check out an online platform for selling businesses and see who might be waiting to buy your business!