Is there typically a transition period during which the sellers of a retail business are paid to provide support?
I am attempting to buy a retail business. I am purchasing everything—product, building, business information. Couple is retiring. I am wondering if there is generally a transition period where the seller helps the buyer to transfer information to the distributors (vendors). And how much salary is typically paid?
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So legally speaking, there usually is a transition period, but what happens during that period usually just depends on what the parties agree to. It helps if you hire an attorney who can help draft language that determines what the rights and obligations are for each party.
It's normal to have a small transition period where the seller takes on the burden of things like training and transferring accounts, etc.
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I am attempting to buy a retail business. I am purchasing everything—product, building, business information. Couple is retiring. I am wondering if there is generally a transition period where the seller helps the buyer to transfer information to the distributors (vendors). And how much salary is typically paid?
Lexi, Chatbot
It sounds like you're in the process of buying a retail business, that's a big step! Have you discussed with the sellers if there is a transition period included in the sale agreement?
We are trying to work through this now. In the past, they bought out their partner (when the business was first established) and the original intent letter wanted me to state they would continue as normal with them receiving money for 2 months post-closing. Just curious what is a normal transition period.
Lexi, Chatbot
Are you looking for guidance on how to structure the transition period and determine the appropriate salary for the seller during this time?
Yes.
Lexi, Chatbot
Is there anything else the Lawyer should know before I connect you? Rest assured they’ll be able to help with your transition period.
I will be buying all their current inventory. Everything.
Legal Eagle
Hello! Legal Eagle here. I'm reviewing your issue in detail. How long do you expect the transition to take?
Honestly, I don’t think it will take more than a week. 2 weeks at most.
Legal Eagle
Have you discussed with the seller about what it is you are wanting them to do?
Yes. First they were going to let my niece (who will be my manager) come in and work with them prior to close. Now she states she would stay with us after, but then she was like "how much are you going to pay me?"
I have never done this before. Then as I stated, they gave me this old letter of intent to buy that stated they would keep 2 months of income once we closed. And this is old and outdated and does not fit our situation. I did not sign it. I made one from eForms which is straightforward.
Legal Eagle
Ok, thank you for adding that! If your niece is going to work, then she is owed at least minimum wage or whatever she and the seller agree to. Was there anything else before I answered?
No, just curious about normal transition—just to get us changed to her distributors and how to use her computer system is about all we need to transition.
She is going to take her bank account and we are going to start fresh.
She is also not letting us keep the name of the store.
Legal Eagle
So legally speaking, there usually is a transition period, but what happens during that period usually just depends on what the parties agree to. It helps if you hire an attorney who can help draft language that determines what the rights and obligations are for each party.
It's normal to have a small transition period where the seller takes on the burden of things like training and transferring accounts, etc.
Okay, this is what she seems to be trying to get out of and trying to reverse it on me—where I take her on after and pay the seller a salary.
Legal Eagle
I hear you! Did you have a follow-up question for me?
No, that is it. Thank you for your response.
Legal Eagle
You bet. I'm sorry to hear about your situation!
Legal Eagle
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