The matter of confidentiality is one topic that is generally on the mind of every owner thinking of selling a company. If you want to sell, who should know about your plans -- and when? This article is devoted to the topic of in-house confidentiality.

The matter of confidentiality is something that should NOT be taken lightly -- especially in-house -- when it comes to the people that you interact with on a regular basis. At this level, you need to keep mum on your decision to sell until the deal is closed.

During World War Two there was a saying that loose lips may sink ships. When selling a company, loose lips may very possibly torpedo your ability to get the most money for your business. Widespread knowledge that your company is in play can have an adverse effect on your operations, on your sales, and on your profitability.

Think about the various people you have relationships with, and how they would react if they knew your business was for sale. These folks are...

• your employees

• your suppliers and vendors

• your customers

• your competitors

Let's think about each one of them.

First, your employees. If they know your business is for sale, they may start wondering about job security. This could affect how they deal with customers, and with your equipment, and with your inventory and supplies.

Your vendors can also get nervous. They may alter their terms and start demanding cash on delivery.

Customers. They can lose confidence and begin taking their business elsewhere. A drop in sales will certainly impact your bottom line, which will cause your company to drop in value.

And what do you suppose your competitors will do if they learn that your company's for sale? You know that they talk among themselves! They can start rumors that are passed along to your customers, to your employees -- especially the good ones that they'd like to hire -- and to your vendors.

Until the deal is closed, there are only three people who need to know about your decision to sell.

First, is your broker or merger & acquisition intermediary.

Number two, is your attorney.

And number three, is your outside accountant.

Selling professionals are fully aware about matters of confidentiality. But it is probably a good idea to remind your attorney and accountant about it. But when dealing with anyone else, remember the old adage: Loose lips may sink ships!