Whether you're thinking of selling your business immediately or in a few years, there are steps that every business owner can take immediately to ensure that the most important deal in your company's lifetime goes smoothly.

1. Nail Down Your Company's Near and Long-Term Strategy

The first step to a successful transaction is a thorough self-evaluation and goal-setting process. Some questions to answer include:

  • How do you compete in your market?
  • What does your company mean to your customers?
  • How do you create value?
  • How are you executing on your strategy?
  • What are your greatest strengths?
  • What have your company's greatest successes been to date?
  • What's your growth plan?

Also look on the flip side and have the answers to questions like:

  • What are your weaknesses?
  • Where can you be stronger?
  • What are your company's roadblocks?
  • What's your succession plan for key members of your team?

"You want to make a plan to address those challenges," explains Patrick McNulty, a managing director at Harris Williams & Co, a leading global investment bank focused on M&A. "You likely can't wait until everything is buttoned up perfectly before you begin thinking about a transaction--but you want to strive to get as close to that as possible."

You should also think about your personal goals. Do you want to stay with the company you built, or will it be time to move on? The answers to these questions will help guide you through an M&A process. 

2. Be Sure Your Timing is Right--Seek Advice Early and Often

When you go to market is critically important since what's happening in your industry, the stock market, credit markets and the economy in general can make a huge difference in the deal you'll ultimately make. You need a trusted advisor who can objectively and knowledgeably assess your company and the broader market and environment, and help you make those red light-green light decisions. "Engage a trusted advisor early whether the time for a transaction is now or five years from now," says McNulty. "It's never too early to start thinking about it. We often work with clients well before they engage in a transaction to help them prepare, think through their goals, and determine timing."

3. Do Your Housekeeping               

Just as you would clean your house thoroughly before hosting a big party, this is a good time for a business spring-cleaning on issues like finances, risk management and legal and regulatory compliance.

You are going to need to show, in the most objective terms possible, that you are able to execute on your company's strategic goals. "Have the tools in place that actively measure your business with real-time, accurate data," urges McNulty. "Accurate data translates into credibility, momentum and value for a transaction." And the more data you have easily on hand about your business, the more efficiently you can move through an M&A process (if the timing is right).

4. Create a Circle of Trust with Your Executive Team

To the extent that you can, identify key trusted people inside your company that can help as you prepare for the sale process. "You can keep that circle as tight as you like, but the more people who are prepared, educated, and ready, the more you'll be able to move efficiently within the process," says McNulty. 

5. Be Visible

Even if you're not planning to sell anytime soon, it's a good idea to be as visible as appropriate for your industry sector. Go to conferences, be a part of a panel if you can do so without confidentiality concerns, and generally keep your antennae up. "If you get an inbound call from a potential buyer, listen," advises McNulty. "You don't have to have active engagement, but you do want to keep those relationships warm, and that will help you track the pulse of the market." 

In Conclusion

Sounds like a lot? The reality is that the steps you'll take to prepare for a successful M&A deal aren't all that different from what it takes to run a successful company.  With advanced planning--and excellent advice along the way-the M&A process can be yet another successful milestone in your company's history.