The business bill of sale legally binds the selling and buying of the business under the law and recognizes the change of ownership rights. Moreover, this document encloses valuable information regarding the seller and buyer and about the business being sold.
What Is a Business Bill of Sale?
The business bill of sale is a lawfully approved document that authorizes the selling and buying of a particular business including all its assets. Further, it declares the buyer as the new owner of that business.
It ensures that the rights and ownership of the business are transferred smoothly and successfully to the new owner, thereby avoiding any kind of dispute in the future. It plays an essential role in record keeping and can be used for small transactions of the business.
Both buyer and seller arrange the meeting of sale, discuss the basic terms and agreements of the sale before signing the document. The business bill of sale ensures that the transferred business is lien-free.
When Do I Need a Business Bill of Sale?
This document is needed for professional business matters to run smoothly. The following points indicate the importance of the business bill of sale:
- It is particularly required when a business dealing is made, whether it is the whole business along with its assets or sale of a small business.
- The business bill of sale is a written declaration of the transference of the ownership to another person i.e. the buyer. Hence, it is required when a person or a party decides to give the rights of a business to a buyer party.
- This document is compulsory for the business registration process.
- If a business bill of sale is not acquired while selling a business to a buyer, there is a high risk of the dispute of ownership along with other severe legal ramifications. Therefore, a business bill of sale is needed to prove your ownership.
How Do I Sell My Business?
The process of selling a business is comparatively more complicated than selling a property or a commodity. There are certain aspects of selling business such as:
- Consult a business attorney and sales advisory board because larger and widely spread businesses have a lot of intricacies that must be scrutinized before purchasing.
- It is recommended to hire a broker to facilitate yourself in the process of business selling. The broker can manage the selling process and arrange for potential buyers for your business.
- Arrange for an evaluation specialist to calculate the estimated worth of the business considering the factors of risk, potential growth, size of the business.
As the deal finalizes, the seller will need certain documents to handover to the buyer.
Accounting Information
It is highly advised to hire a professionally licensed accountant so that he can arrange these following documents:
- Profits Loss Statement
- Balance Sheet
- Cash Flow Sheet
- Tax Returns (Last 3 years)
- Bank Statements
Information about the Business
The seller needs to provide all necessary and relevant information regarding the business in the following order:
- Company Information Summary
- Security Report
- Employee List
- Business Bylaw
- Media Accolades
- Evaluation Materials
- Marketing Strategy
- Operation Information
- Client Information
Legal Information
Gather all the legal paperwork that is required to transfer the ownership rights of the business. The required documents are:
- Revenue Documentation
- Profit Reports
- Expense Reports
- Non-disclosure Agreement
- Letter of Intent
- Articles of Incorporation
- Partnership Agreement
- ROI Analysis
- Supplier Agreements
- Assignment of Licenses
- Assignment of Leases
- Stock Status
- Asset Acquisition Statement
Marketing Strategies
The seller can make arrangements to promote the business through advertisements and proper publication. Use the mediums of social media, newspapers, magazines, and articles, etc.
Include pictures of the business location, provide information regarding the type of business, and more importantly the selling price.
Finalizing the Deal
As soon as a potential buyer shows interest in buying the business, arrange for a face to face meeting. Discuss the terms and agreement of the deal. Decide on the realistic closing date. Fill the Business Bill of Sale form.
What Are the Components of the Business Bill of Sale?
The components of a business bill of sale include:
- Address: Download the PDF Form and write the address of the location at which the bill of sale is being signed along with the date in the format of 'DD/MM/YY'. Also, write the full name of the seller of the business.
- Price: Provide the agreed purchasing price of the business. Mention the price in words and numerical digits.
- Information of buyer and seller: Write down the applicable names of the seller and buyer for acknowledging the legitimacy of the transfer.
- Notarize: After everything has been finalized in the form and completely understood, the document will be notarized by the notary and the last few required things are county, date, notary’s name, seller’s name, notary’s signature, notary’s commission expiration date, notary seal, etc.
Conclusion
The business bill of sale aids the transference of your business to another potential buyer. If you are also seeking the perfect method for selling your business to a potential buyer then CocoSign has the solution to your problem. Get your free template for your ready-to-sale business today!