If you’re contemplating listing your Amazon FBA business for sale with the help of a business broker, it might lead you to wonder whether you are obligated to tell your contractors, suppliers and other people involved in your business that you intend to sell. It could be a good idea to tell any long-time employees or contractors that you plan to sell the business. But this is a very delicate process and one that should be approached with care. There are many risks that you can face if you tell people who are not on a need-to-know basis. First of all, vendors or customers might perceive this as a sign that your business is failing rather than thriving.
Most people might be under the impression that you are choosing to sell because you’re getting out before things get any worse. Furthermore, any competitors who learn about this information could leverage it as an opportunity to steal your customers. Finally, employees who have been working with you personally, such as any full-time contractors, might worry about their job security and begin looking for other work before you’re ready to sell the company and make the transition.
But if you wait too long to tell any key workers in your company, this could make it difficult for you to hide information for the remainder of the sale, which could take up to a year or longer. There’ll be plenty of confidentiality risks you face over that time, such as leaving an email open that you didn’t expect someone to see, accidentally forwarding something or having meetings on your calendar about selling the business.
Keep Sales Details Private with Your Employees
One common recommendation for selling your Amazon FBA company is to keep this private until the deal is done. You’ll lose control of the conversation if your workers find out that you’re selling before you’re ready to do so.
One of the most valuable assets in your business could be your contractors, and in many cases, the owner of the business needs the vendor relationships and employees more than the seller ever did. Certain employees may have to know in advance, however, key employees or contractors should be aware of your plans to sell your business.
Examples can include any senior level managers, business managers you’ve hired or an accountant. This is because lenders and buyers might be asking for updated financial details on a regular basis and want to be able to provide this appropriately.
The best time to tell key contractors is either right before or right after closing on the sale of the business. This is because the risk of a deal falling apart and breaking into pieces after the due diligence process finishes is greatly reduced, and furthermore, this allows you to tell contractors that you’re selling and introduce the buyer shortly after before they develop time to worry.
This can also be your opportunity to explain to the employees what this really means for them as far as whether or not the new buyer of the company has to keep them on as key employees or whether they need to begin looking for another position. When you choose to sell your business with the help of experienced business brokers, you’ll have a good graph of the entire situation.