Business Brokers - Sell Business - Business Sales and Acquisitions - SunbeltNE

How to Get Right Price When Selling Franchise

2011-08-31T08:14:00.002-04:00

There could be many reasons a franchise owner decides to sell the franchise. But several franchise owners enter the process of selling franchise without being aware of and informed as to how to sell a franchise, what to expect, and what precautions should be taken and often find themselves in trouble often end up getting a lower selling price than the franchise is worth.

There are certain aspects that need to be taken care of when selling franchise so that the franchise, which you worked hard to build, should generate fair price when sold. The suggestions, that can help you generate fair price for your franchise, are as under:

Let your Franchisor Know
You should keep your franchisor informed about your intention to sell the franchise. Number of franchisors may have specific rules on selling the franchise. These rules must have been listed there in the franchise contract.

Your franchisor might be able to support and help you in selling franchise, as franchisors; being in the business for quite some time; might be aware of prospective buyers who are interested in a particular territory and might be in a look out for a good opportunity to buy some franchise.

Understand the Market
After informing the franchisor about your plan of selling franchise, now it’s time to develop the primary understanding of the market before your sell your franchise. Collect the relevant data, analysis – how much of similar franchises have been sold of late. Is this the right time to sell the franchise, is the market hot? Who could be the potential buyers for your franchise?

The answer to these questions will directly affect the sale of your franchise. There are possibilities that you will find that this is not the ripe time to sell your franchise or you can also discover the actual worth of your franchise.

Do the Homework
You should do some preparation before you actually present your franchise on the market for sale. These preparations should include the right value of franchise, arranging financial details, informing key employees (if you have any) and lastly putting together a sales package.

There are certain franchises which require more upfront arrangement than other franchises. Hence, just assess your franchise falls in which category.

Advertise and get ready for Sales Pitch
Even if your franchise is amongst the best in the town, without spreading awareness among the buyers you cannot reach anywhere. Make sure that it’s rightly and appropriately advertised and promoted through every possible mediums. You can also take help of agents to promote your franchise and list it with them. In addition you need to prepare your sales pitch and practice the same for the final day.

Offer Assistance to the Buyer
Majority of occasions you may need to provide support and assistance to your buyers in terms of re-establishing the franchise after they buy it. This assistance can be of several types which may include training, technical or functional support. You may also need to work along with your buyer for quite a few months as well.

Happy Independence Day

2011-07-01T09:47:00.001-04:00

Sunbelt New England salutes all the freedom fighters who fought for our freedom. On this occasion of the Independence Day, Sunbelt New England wishes you all a very delightful and happy Independence Day!

Happy Father's Day

2011-06-17T10:35:00.000-04:00

A great salute to the Father as a guiding force in our lives! Sunbelt New England wishes you a Very Fruitful and Happy Father’s Day!

Happy Mother’s Day

2011-05-08T06:00:00.001-04:00

Make Mother's Day a memorable one, and let her know how much she means to you. Sunbelt New England wishes you a Very Fruitful and Happy Mother’s Day!

Happy President’s Day

2011-02-21T06:01:00.002-05:00

Once again President Day is there to remind you all, what role our past presidents played to make our country the world leader! Let’s commemorate this historical occasion jointly and pledge to continue celebrating this event every coming year to honor our past presidents.

Sunbelt New England wishes you a Very Happy President’s Day!!

Know When to Sell Your Business

2011-02-11T10:08:00.001-05:00

Selling a business can offer you a great deal of opportunities, but unless you have a good understanding of your exit strategy and the appropriate process to implement it, you will be left with a business that you would not be able to sell or you can't obtain its real value when you do sell.

To avoid such situation, there are a few tips that you need to consider prior to you even think to sell your business. These points are easy to understand and will enable you to get some useful tips on whether it’s right time to sell a business.
• Are you ready to sell your company?
• Do you have a company that you can sell?
• Is this the right time to sell?
• Are you personally interested in selling?
• Will it assist your life plans if you sell your business now?

For instance, you have managed your own business for almost 10 years now. You have generated a fair amount of savings and contemplating about retiring. To add some stability to your future savings, you are considering selling a business. Under these circumstances consider above stated tips and look at your business to analyze if selling is a prudent decision.

You should ask yourself if your business is salable. Well, do you have a steady flow of customers that keep you working full-time? Do you have additional requests for work every week? Do you employ multiple employees to help you in your business full time and your records for the past four years manifest continuous growth and profit? If yes, your company is salable.

Now, are you all set to sell a business? Are you really old enough to retire? Do you want a life outside of your business and determine that this is the perfect time for you to get out?

Next, given the economy in mind, is this the best time to sell? Well, it is the middle of the winter and your business is always the strongest during the winter. Also, you just got a machine replaced for one of the business' assignments, and for the last 6 months you have put money back into the business to install latest tools and equipment. In addition, the ever-changing economy is booming in your city. Of course, it seems that now is a right time for the business to sale.

Next, are you personally devoted to selling? You wish to take rest, as you would like to be able to travel and enjoy your retirement without taking up the stress running a business brings. So yes, you are entirely dedicated to selling your business.

Finally, does selling bring value to your long-term plans? Selling the business for a feasible price would enable you to realize your dream of investing in the stock market, which you have always dreamed of doing but never had the opportunity. This would also enable you to rest on weekdays and travel in your camper whenever you want. So yes, selling your business will enable you realize your objective of a successful retirement.

Selling your business should not be a grueling process. With a little knowledge and evaluation, you handle this process with confidence.

Welcome 2011

2010-12-31T05:06:00.002-05:00

As 2010 descends, we get ready to welcome this New Year with open arms. It had been a great year (glad that America has bounced back .. no questions about why we are still the leading nation across the globe). Let's pledge to continue our association next year.

Happy Thanksgiving 2010

2010-11-22T03:58:00.003-05:00

It’s time to be thankful for all the good things in life. Thanksgiving 2010 is upon us and here Sunbelt Team wishes you a sincere heart-felt thanks to all our clients, well-wishers, friends and family who have helped us survive the difficult recession of 2009-10. We look forward to enriching upon this relationship for further growth next year.

Sunbelt Team wish you great time with your family and friends on the Thanksgiving Day.

Happy Columbus Day

2010-10-11T03:10:00.003-04:00

SunbeltNE wishes you a very HAPPY COLUMBUS DAY! It’s the day of the arrival of Columbus in America and celebrates the spirit of adventure and discovery. So hope your day is filled with fun and adventure!

Want to negotiate actively for your business for sale? Some steps to follow

2010-09-08T06:39:00.000-04:00

Your ultimate aim in putting up your business for sale is getting the right price for it. However, many sellers settle for a lower price for their business as they ignore the importance of negotiations. After you list your business for sale, you need to negotiate effectively with the buyer in order to ensure that you achieve your target price. Take the following steps so that you are well prepared for negotiations.

Start preps well ahead of time

You should prepare your business for sale ready well ahead of the time you need to talk to potential buyers. Your total effort should be in making your business for sale as attractive as possible to potential buyers, so that you can negotiate actively when the time comes. You can take care of a professional like a business broker to prepare your business for sale. If you start the preparations well in advance, you can hike up your asking price, negotiate aggressively as well as increase the chances of closing a successful deal.

Put the right team together

Putting up a business for sale is a complicated and long process, which cannot be done overnight. You will need the help of a lot of professionals. A business broker is the first professional you will need when you list your business for sale. Having an expert at your side will help you in knowing the process and take the right steps at all times. The business broker will also help you in the negotiation process, as they have a lot of experience in such dealings. Such negotiations skills of the business broker will come handy to achieve the selling price you want for your business for sale. In addition to a business broker, you will need other professionals as well like lawyer, CPA and financial adviser etc.

Set your target price

A lot of business for sale owners go forward with the selling process with the wrong expectations. Such wrong expectations delay the selling process, and sometimes becomes the reason for a failed deal. Before you put your business for sale on the market, know the kind of price you are expecting for it. That way, you will be able to negotiate effectively along with your business broker and will know when you have achieved your price goal.

Take the time to find the right buyer

Have patience while selling your business; it is a long and tough process which will require your full focus. Sometimes a business for sale deal may end in a deadlock, with neither the buyer nor the seller willing to budge. Keep your expectations in check when you enter the negotiation round for your business for sale and don't expect the deal to close as soon as you start negotiations.

Happy Labor Day

2010-09-03T05:15:00.001-04:00

SunbeltNE wishes you a HAPPY LABOR holiday! Here we salute the silent heroes 'the American workers' whose contributions have made us one of the greatest nations on this planet. We admire and celebrate the economic and social achievement of all our workers.

Have you put up a business for sale? Sell it confidently

2010-08-17T04:30:00.001-04:00

Putting up your business for sale is just the first step of closing a deal. You have a long way to go, and you will find a proper buyer to hand over your business only when you are confident of the selling process. A business for sale needs a lot of work, so be prepared mentally as well as physically to give in your best efforts to sell it. To find a person looking for a business to buy, you need to ensure that you have the patience and skills required to spot the right buyer when you come across one. If you want to become a confident business for sale owner, read on.

Seek expert help

The process of putting up a business for sale is a complicated one, in which you will need professional help. Professionals like business brokers, lawyers, accountants etc. are experts in brokering a business for sale deal. These professionals help you portray a strong and confident image to the buyer, so you increase the chance of closing a successful deal. They may also be of great help in guiding you as to what a person looking for a business to buy expects of you as a seller. A business broker also has a lot of businesses to buy on hand and is approached regularly by buyers. Listing your business with the business broker might help find the right buyer for your business for sale.

Pricing your business for sale

You need to determine the price of your business for sale very carefully, as it may make or break the deal for many buyers. If a business to buy is priced too high, people looking for a fair price for may be put off. Even if you price your business for sale too low, a buyer may doubt the feasibility of your business operation. People looking for businesses to buy scrutinize the pricing very carefully and you would do well to have a good reason for the price you are demanding. Get a business valuation before setting the price of your business for sale, so you can put your business on the market for an attractive price for a buyer.

Keep your options open

You need to entertain multiple buyers if you want to keep an edge in the business for sale transaction. If you are desperate to sell your business and the buyer senses that he/she is the only one in the picture, you will lose the negotiation power. Good businesses to buy today are few and if yours is worth it, you will find a lot of people expressing interest. Entertaining multiple buyers ensures that you have options a choice when it comes to selecting the owner for your business for sale. You will be able to find the right person looking for a business to buy only when you have multiple offers on hand.

Avoid these errors while putting up a company for sale

2010-07-23T02:32:00.001-04:00

Listing your company for sale is one of the hardest decisions you will make. After all, you must have put in many days and nights of dedicated efforts into it and letting go of it is a tough call. Having worked hard to bring your business to a certain level, you would also want your company for sale to go in the right hands. Selling to the wrong person or botching up the selling process can seriously jeopardize your business. So here are some of the common errors of selling a business that you can keep in mind when you put up your company for sale.

Expecting the wrong price

Most business owners make the mistake of either over-pricing or under-pricing their business when they put it up on the market. A potential buyer will examine your company for sale through its profitability, turnover and future potential and then determine the price he/she is willing to pay for it. Over-pricing your business will put off the buyer even before you reach the negotiations stage. Under-pricing, on the other hand, will create unease in the buyer’s mind as to the feasibility of the business for sell, and will delay the whole process even more. Work with a business broker to determine the true value of your business and prepare yourself for the price to expect for your company for sale.

Selling at the wrong time

The past two years have been the toughest in recent times, with buyers reluctant to part with their money even for a viable company for sale. The timing for selling your business is one of the most important factors in closing a deal. You should also keep in mind that selling a business when it is incurring losses is a bad idea. You should, in fact, consider putting up your company for sale when it is at its peak and profit levels are the highest. That way, you can negotiate effectively and obtain a good price for your business for sell. Keep the idea of selling your business in mind always, so that you can grab the right opportunity when it comes by.

Insufficient financial documents and information

You need to help a potential buyer to make a decision about your company for sale. For that, you need to have all financial information at hand so that when the buyer needs it, you can provide it immediately. Such prompt action will help the buyer analyze the business for sell quickly and make a decision. Lack of such important documentation is an immediate deal killer for most buyers. Ask your business broker for a list of all documents you need to keep ready before a buyer visits you on-site.

Selling in haste

You may be tempted to accept the first offer you get. However, making the decision in haste is a bad idea. Ideally, you should have multiple offers on hand so that you can negotiate strongly and get the best price for your company for sale. Consider all the offers you have with your business broker’s assistance and then decide on the best one of the lot.

Not using a business broker

The guidance of an expert business broker will go a long way in closing a successful deal. By not using such an experienced professional’s services, you risk elongating the business selling process and selling to the wrong buyer. Moreover, the business broker can focus totally on selling your business while you carry on with the everyday business activities of your company for sale. The commission you pay to the business broker will be totally worth it when you hand over your business to the right person.

Happy 4th of July 2010!!

2010-07-01T10:31:00.002-04:00

SunbeltNE wishes you, our clients, readers and well wishers, a very happy 4th of July 2010. Have a great time this long weekend and enjoy this Independence Day to the fullest with friends and family.

Are you using a business broker for your company for sale?

2010-06-25T02:57:00.000-04:00

Many people who put up their company for sale try to do it on their own. They want to avoid paying commissions to a business broker and increase the profit margins from the sale. However, this is a serious mistake which can hamper the sale of a company. Granted, a lot of brokers charge hefty commissions on closing a business deal. But they also offer security and experience in closing a successful deal. You may avoid paying the business broker commission by doing the deal alone. But you also face the risk of coming across a phony buyer who will waste your time and keep you from closing the deal quickly. Putting up your company for sale without the advise of an experienced business broker is a huge risk which you should avoid if you want to hand over your business to a genuine business owner who can develop and grow your business further. If saving commission is the topmost thing on your mind, consider some advantages of using a business broker while setting up your company for sale:

Experience

The most important reason you need a business broker is his/her experience in closing a deal. When you go to a professional, you are ensuring that the process you need to follow to put up your company for sale is defined. Having the business broker guide you in all the steps of selling your business will ensure that you avoid common mistakes and get the best deal in your favor.

Network

As the business broker will have years of experience in buying and selling businesses, he/she will also have an established network through which you can promote your company for sale. This means that as soon as you hire their services, your company will immediately reach interested buyers. Such promotion not only relieves you of the task of looking for appropriate buyers, it might also increase the possibility of closing the deal quickly.

Negotiations

A majority of business buying or selling deals break down at the negotiations stage. With the experience that business brokers have in buying and selling business, they will be an asset when it comes to negotiating effectively. All you need to do is set a realistic price range you want to get for your company for sale and the business broker will handle the rest.

Focus on developing your company for sale

With a business broker into the picture, you can hand over all the intricate details related to your company for sale and focus on developing your business. Doing so will ensure that you don't ignore your business activities while promoting it for sale and add to the value of your business.

Confidentiality

If you promote your company for sale yourself, it draws attention of your employees, clients as well as a lot of competitors. This may have negative repercussions for your business. But when you hire a business broker, you generally sign a confidentiality agreement with him/her, in which they agree to keep the sale of your business confidential until it changes hands. You can hence maintain complete confidentiality related to your company for sale.

Have a business for sell? Some questions to ask yourself

2010-06-14T07:04:00.002-04:00

Putting up your business for sell is a once-in a lifetime opportunity, which you need to perfect in order to reap the rewards. After all, you don't want to sell the business you have worked so hard to develop at a cheap price or to a wrong seller, do you? That being said, there's a lot which goes into preparing a business for sell. In order to be able to successfully prepare your company for sale, you need to start with a few questions to yourself as the business owner. The following are some of them:

Can your business be sold?

There are many elements in a business which may make it an attractive proposition for a buyer. You need to find what that element for your business for sell is. This way, you can know what the base of your selling proposition is or what your strong point is. So find out whether your company for sale has a long history of profitability, a large customer base, a niche product, a skilled workforce or a great location. Once you lock on the main value proposition for your business, you can use it to convince the buyer as well as to negotiate effectively.

Do you know your business' worth?

Many business owners have no clue about the value of their business. They make certain assumptions based on the amount of work they have put in and either overprice or under-price the business for sell. This is a big mistake, which will seriously hamper your business-selling efforts. Don't base the selling price of your business on assumptions. Get a professional business valuation for your company for sale, which will give you an idea about what a buyer is willing to pay for it. Such a business valuation will not only give you a fair idea with regards to the price, it will also help you in negotiating effectively with prospective buyers.

Are you ready for negotiations?

The last step of the business-selling process is negotiations. This is a tough stage in which a majority of deals can break down. Have clear goals for your business for sell when you enter the negotiations stage. Your expectations should also be reasonable. For example, you be hoping to get full cash when you put up your company for sale. However, this is less likely to take place in today's cash-strapped market. You can instead negotiate for a non-cash deal with a partnership in profits or etch out a deal where you can help with the business once the business is handed over to the new owner. While this might not give you cash right away, it may be more profitable in the long run. Keep such long term goals in mind when you put up your business for sell.

You will be able to follow the steps of selling a business only when you are clear about all these issues. Having clear answers to these questions will enable you to etch out a successful deal for your business for sell.

Happy Memorial Day 2010

2010-05-31T05:01:00.001-04:00

On this Memorial Day, SunbeltNE pays tribute to all the soldiers who have laid down their life for our country. Here’s saluting all our war heroes for their selflessness, bravery and sacrifice.

Have a company for sale? Know what’s going on in the mind of the buyer

2010-05-05T05:38:00.011-04:00

There are qualified buyers looking for a profitable business to buy. As a company for sale owner, it is your job to make your business as attractive as possible to these buyers, so that you can close the deal fast. However, you need to get into the mindset of the buyers and know what they are thinking in order to get the best price for your company for sale. By paying attention to exactly what the buyers want, you can customize your business for sell and make it a more attractive deal for them. A good business broker may also know what the buyers expect and hence may be able to help you sell your business. The following are some questions which may be going on in the buyer’s mind when he looks at your company for sale:

What is the price of the company for sale?

The buyer will invariably be looking for a company for sale which has a reasonable price. The price range should also match the budget he/she has for buying a business. If your business for sell is attractive for them, the buyer may seek alternative ways to finance the deal. He/she may also have questions about seller financing for your company for sale, which you need to be prepared for.

How is the customer base of the company for sale?

If the buyer is looking to run your business after buying it, he/she will be thinking about how strong your existing customer base is. Having a good customer base will make your business for sell an attractive deal for the buyer. Knowing your clientele properly, including who is your top customer, how much revenue is generated, percentage of profits from customers are some of the things you need to be aware of in order to answer questions related to your company for sale.

Is the company for sale profitable?

The buyer is obviously going to look for a profitable business for sell. You should hence have all your financial documents ready for the buyer to examine, so that the true profitability of your business is apparent. Have details of your company for sale like inventory, P&L statements, vendor lists etc. ready when you meet the potential buyer. Your business broker might be able to help you out in getting your financial papers in order.

Knowing what your potential buyers are thinking will not only help you prepare your company for sale, it will also give you ideas as to how to improve the business until it is sold. The mindset of the buyer will also help you determine how much price to ask for your business for sell and how to augment that price to the maximum.

Are you prepared to put up your business for sell?

2010-04-23T03:34:00.001-04:00

The decision to put up your business for sell is a serious one, with the potential for you to achieve your retirement goals or help you move on to another profession comfortably. Preparing your business for sell is complicated and you should take appropriate steps to see that your business sells quickly and you get the best possible price for it. The following are some steps to ensure that you prepare your company for sale quickly.

Maintenance of equipment

If your business for sell uses any machinery or equipment, you need to ensure that it is serviced and functions properly before the buyer comes in for inspection. The buyer will expect all the equipment to be in perfect running condition when he considers your company for sale. Any operating problems in your equipment will raise a red flag, which will hamper the chances of selling your business quickly.

Information related to your clients

One of the main queries for a qualified buyer will be related to your clients. Do you know the client base for your business for sell properly? Can you answer questions related to them comfortably? It is important for you to know details related to top clients, percentages of sales associated with them, how much revenue is brought in with those clients etc. When you put up your company for sale, you should have all this relevant information at hand to answer the buyer's questions.

Find a business broker

You cannot go the whole way alone if you want to sell your business. So when preparing for a business for sell, look around for a reputed business broker. A business broker will help not only in the negotiations, but also in the steps to be taken to close a successful business for sell deal. With a business broker by your side, you are sure to get the best price for your company for sale. Besides a broker, you may also require the services of a lawyer and an accountant to sell your business.

Have all the financial information ready

Don't wait till the last moment to get all the financial papers ready for your business for sell. If the buyer is seriously interested in your business, he/she will examine all the financials of your company for sale in detail along with their experts. There is a lot of paperwork associated with the financials which you need to get together before you put up your business for sell. You will require P&L statements, income tax returns, bank statements, asset listings, employment tax filings revenue reports and much more when you put your company on the market. So take the time and help of your business broker to get these papers together.

The preparation for a business for sell takes a lot of time and effort. So make sure that you start well in advance if you want to sell your business quickly and get the right price for it.

Business brokers: An advantage or a needless expense?

2010-04-05T10:16:00.004-04:00

Do you have a business for sell? Are you preparing for its sale? Are you wondering whether hiring the services of a business broker is necessary for closing a successful deal? Many first-time business sellers wonder about taking care of the business for sell on their own, saving themselves the expense of the business broker. While planning and preparing your business for sell may be the cheaper option, it is definitely better to hire the services of a professional business broker who can guide you through the process of selling a business. Putting up a business for sell on your own exposes you to the risk of making amateur mistakes, which may break the deal. A professional business broker can not only help you in looking for the appropriate buyer, he/she can also help you undertake business valuation, so that you can price your business for sell properly. Moreover, as a professional who has experience in selling businesses, a business broker can guide you through all the phrases of selling your business.

Listed below are some of the aspects you should pay attention to along with your business broker if you want to close a successful deal.

Business Finances
Business buyers always look through your financial documents to examine the profitability of your business. Your business for sell finances should be in perfect shape if you want to make a successful sale. You, with help if your business broker, need to get all your business finance papers ready with the help of a professional accountant. Your business broker can also determine the valuation of your business according to the financial health of your business for sell.

Business Valuation
The valuation for your business for sell needs to be neither too high nor too low, if it has to attract the attention of potential buyers. If you price your business too low, the buyer might wonder about the true profitability of your business for sell. On the other hand, the buyer will also be unwilling buy your business if you value it too high. Your business broker can help you in getting the true valuation of your business for sell, so that you price it properly and can close the deal successfully.

Other Financial Documents
You will need to gather other documents related to the business for sell, which you need to hand over to the new owner. These may include licenses, business permits, leasing agreements etc., which the new owner will need to run the business. Your business broker can help you organize these documents so that you are completely prepared for handing over your business for sell.

The expense related to a business broker will be more than compensated when you close a deal. Not hiring one can mean the difference between a successful business for sell deal and an unsuccessful one.

Happy Easter 2010!!

2010-04-02T08:04:00.003-04:00

It’s time for celebrations to begin: Easter 2010 is upon us.

SunbeltNE wishes all its blog readers a very happy Easter celebration. We hope you have a great time with your family and friends over the Easter weekend.

Do you have a business for sell? Some mistakes to stay clear of

2010-03-12T07:40:00.000-05:00

As a business for sell owner, you may wish to accomplish your life’s goals when you put it up in the market. In addition to seeing your business for sell going in the right hands, you also want to get the right price for a company you have built right from scratch. However, closing a successful deal is a complicated procedure, during which you need to avoid some deal breaking mistakes. The following are some of them.

Putting up a company for sale without a business broker

Many business for sell owners try to save on the commission by avoiding the services of a business broker. This is a crucial error, which may spell the difference between a successful and an unsuccessful deal. As a business for sell owner, you might not be able to juggle your business responsibilities and sell your business successfully. Hiring a business broker will enable you to focus on your company for sale while the broker will concentrate on getting a qualified buyer for you. Moreover, a professional and experienced business broker will also be able to guide you through the selling process, right from finding a buyer to the negotiations stage. The cost of a broker will be worth it when you close a successful business for sell deal.

Wrong pricing for your company for sale

A major deal breaker is the pricing of a business for sell. Sellers usually end up either under-pricing or over-pricing their business. A business buyer will evaluate your company for sale by evaluating its financial condition, turnover, profitability etc. If the price of the business is more than its worth, the buyer will be put off. Some sellers even under-price their business for sell with the hope of attracting more buyers. In such a case, the buyer might doubt the profitability of the company for sale. Your business broker can guide you regarding the correct valuation of your business for sell.

No financial details for your business for sell

Financial information about your company for sale is the most important aspect of the deal. It is the basis on which the buyer judges the feasibility of the business and makes his decision. Lack of such details will put the buyer off, in which case he/she will reject your business for sell. All financial details like turnover, profits, statements etc. should be ready for the buyer's consideration well in advance, so that he/she can make the decision faster.

Putting up your company for sale at the wrong time

Contrary to what many business sellers believe, you should put up your business for selling when it is performing its best. Many sellers think of exiting their business only when it incurs losses, when in fact, the business should be sold when profits are at its peak. This timing of putting your business for sell is a determining factor for closing a successful deal. So contact a business broker only when your business is at its peak.

Avoiding these common mistakes will help you in closing your business for sell deal faster as well as attracting the right buyers for it.

Putting up a business for sale? Negotiate actively to get the best deal

2010-02-25T08:35:00.001-05:00

Putting up your business for sale has a lot of challenges. You need to ensure that you find the right buyer for it, so that it is run efficiently after you hand it over. At the same time, you want to get the right price for it. Negotiation is a crucial factor in getting the right price for your business for sale. So while selling a business, keep the negotiation factor in mind at all times.

Get A Head Start

Get your business for sale ready before you actually start talking to buyers. Focus on making your business for sale more attractive to potential buyers, so that when it comes to negotiating for it, you have a strong point to drive home. Getting a head start before selling a business can not only boost your selling price, it will also increase the chances of closing a successful deal.

Get A Team Together

As said before, putting up your business for sale is not an easy task. In the process of selling a business, negotiation is the toughest part. Professionals like business brokers who have years of experience in the field can negotiate a deal effectively. You will have to depend on the negotiating skills of a good business broker in order to get the price that you want. You can also take the advice of other professionals like lawyers and financial advisors; however, a business broker is the one who will be crucial for negotiations.

Know Your Goals

Many business for sale owners put their business into the market with unrealistic expectations, which delays, and sometimes even cancels the deal. If you are selling a business, have clear goals about what you want to achieve with the sale even before you receive an offer. This clarity will be of great help when you are negotiating for your business for sale with the help of your business broker.

Know Who Is Buying Your Business

Knowing your buyers will help you in analyzing their requirements and determining which one will be the best owner of your business for sale. It will also help you position your business for sale in the best way so that you can gain the maximum advantage when it comes down to the negotiations.

Don't Be Impatient

Closing a business for sale deal is a lengthy and difficult procedure, in which there may be some hiccups along the way. There are many deals which fail in the negotiation stage, with the buyer and seller in a deadlock about the price of the business for sale. Don’t expect to sign on the dotted line as soon as you start negotiating for your business for sale. Selling a business will require all the patience you have. However, when you sell your business, you will get the price you required.

5 Mistakes to Avoid while Selling a Business

2010-01-25T04:04:00.007-05:00

Selling a business is not an easy task; it takes a lot of preparation, patience and the careful guidance of an expert like a business broker to close a successful deal. If you are thinking of selling a business but have never done it before, you are bound to make some mistakes. The following are some common mistakes made by sellers, which you can be aware of and avoid:

Mistake #1: Not knowing the process for selling a business

The number one mistake you can make while selling a business is not being aware of the process. You don’t have to be an expert at selling a business, but as a seller, you need to be aware of the steps you need to take for closing a successful deal. You might get a lot of help with a business broker, but as an owner of a business for sale, you need to know how the selling process moves.

Mistake #2: Setting the wrong price

A major mistake many sellers make while selling a business is setting the wrong price. High expectations and enthusiasm lead a lot of sellers to over-price their business for sale. Always keep in mind that a buyer has his own team on his side, which guides him all the way through; he is not likely to fall for an over-priced business. A business for sale deal is also under-priced many times in the hope of selling a business quickly. This is also a mistake, as it makes the buyer suspect that something is wrong with the business, or else you wouldn’t under-price it. The right way to price a business is getting business valuation done through an expert, so that you can set the right price and your business for sale is sold successfully. Your business broker will know of a good valuation firm for your business for sale.

Mistake #3: Not maintaining confidentiality while selling a business

If you declare openly that you are selling your business, you may face problems with employees and vendors. Once word spreads that your business is up for sale, your competitors may also take undue advantage by trying to steal your clients. While selling a business, try to take only trusted people into confidence, rather than telling everyone. Select a reputed business broker who is experienced in selling businesses and can maintain confidentiality.

Mistake #4: Not developing the business after it is put up for sale

Once you have decided that selling a business is the best step you can take for yourself, it may be very tempting to stop making the everyday effort to develop your business. After all, the new owner will take care of it pretty soon, right? WRONG! Ignoring everyday activities of business and ignoring growth possibilities is a mistake many sellers make while selling a business. Remember that it may take up to a year for selling a business. If you ignore business activities for such a long time, the price you get for it ultimately will be lesser than what you expect. So keep running your business as usual if you want a good price for it in the end.

Mistake #5: Not hiring a professional business broker

The benefits of using a business broker have been stressed on time and again by industry experts. Not only does the business broker know the process of selling a business like the back of his hand, he will also have contacts which will help you close a successful deal easily. In today’s tough market, not hiring the services of an experienced business broker can be a huge deterrent for selling a business.

Keeping these mistakes in mind will help you avoid them and will make you a more confident seller while selling a business. Your business broker will be able to guide you further if you have additional questions.

Should you use a business broker to sell a business? Definitely yes!

2010-01-08T09:47:00.000-05:00

You’ve probably started and grown your business for years before deciding to sell it. Once you have decided to sell your business, you need to determine whether you want to do it yourself or hire a business broker. Most industry experts will advise you to hire a business broker; and it is the right advice. Hiring a business broker for your business for sale is the right step for you if you do not have previous experience of selling a business. If saving the commission payable to the broker is on your mind, think again: nothing beats the advantages a business broker can offer you.

The Pros of working with a business broker

A business broker has the relevant experience that is required to close a deal. He/she is familiar with the steps to be taken and knows the process in-depth. This experience plays a crucial role in avoiding mistakes and taking the necessary steps to close a successful deal.

Experienced business brokers have an established network within which to advertise your business for sale. They will most probably already have a list of buyers on the lookout for a profitable business for sale. This means that as soon as you register your business with a broker, it will immediately be made visible to interested buyers. Such visibility not only increases the chances of closing a quick deal, but also relieves you of the headache of looking for the appropriate buyer.

Business brokers are experts at negotiations. You just have to set a realistic price for your business for sale and the business broker will focus all his/her energy and resources to get that price for you.

You can hand over the responsibility of selling a business to the business broker, which will allow you to focus totally on your business. Remember, even when you have decided to sell, the business should remain profitable.

The business broker you hire will also know other professionals whom you will need during the sale of the business like a solicitor, a professional for business valuation, accountant etc.

When you sign an agreement with a business broker, he/she agrees to keep the news that you are putting up your business for sale confidential. You can hence rest assured that your employees, competitors or clients will not know that you are selling your business.

After you decide to hire a business broker, the only thing you have to do is find a reputable and experienced one. When you find and hire one, you can sit back and relax, as the business broker uses his/her experience for closing a successful business for sale deal.

Consider These Prep Steps Before Selling A Business

2009-12-29T09:13:00.003-05:00

If you think that you can go about selling a business with ease when the time comes, think again. A lot of preparation goes into selling a business, and you have to start well in advance if you want to close a successful deal. Even if you have a business broker helping you out with the process, there are some basics that you need to take care of. The following are some of them:

Be clear about the reason for selling a business

One of the first questions any buyer will ask you is the reason for selling your business. A buyer might wonder: ‘If the business is good, why is he/she selling it?' You need to explain your position clearly to the buyer. Your reason for selling a business may be retirement, need for money or a change in profession. Whatever the reason is, be articulate and explain it to the buyer and business broker, so that you are on the same level as him/her.

Get valuation done when selling a business

Getting your business valued guides you very well while you are selling a business. You can go to an expert valuation firm which will value your business and help you know its worth. If you don’t know which valuation firm to use, you can consult with your business broker, who will know a reputed professional to get your business for sale valued. Knowing the value of your business will help you price the business and know your market position while selling your business.

Price your business for sale reasonably

Set a price of your business for sale on basis of your business valuation. Many sellers make the mistake of pricing their business atrociously in hopes of finding a buyer who will fall for it. You should know that buyers are becoming savvy in their research and are using business brokers from their end as well, who will know the approximate value of your business for sale. While selling a business, price it reasonably, so you are able to attract serious offers from buyers.

Consider the matter of succession

After selling a business, will there be anyone the new owner can consult for advice in the beginning? You should have a trustworthy person in your business, who can help the new owner settle in. Many business for sale owners offer to stay for some time after the sale, so that issues like training, consultation etc. can be taken care of easily.

Take care of routine business

Once the decision of selling a business is taken, don't ignore your core business activities. Keep focusing on routine business even when you know you are going to sell business. You can hire an experienced business broker to take care of the promotion of your business for sale, so that you can continue running your business profitably.

Hire a business broker

A business broker is going to be crucial in closing a successful deal. Business brokers know the process of selling a business properly and will be able to guide you each step of the way. Not only will a business broker have a list of people looking to buy a business, he/she will also be in touch with other professionals like valuation firms, accountants etc. whose services you may require while selling a business.

The above mentioned are only some of the steps you need to take to ensure you are well prepared for selling a business. A professional business broker will be able to guide you further in this regard.

Merry Christmas 2009

2009-12-23T03:56:00.010-05:00

Christmas 2009 is almost upon us! It's that time of the year when children wait for Santa Claus to bring them their gifts and adults look forward to the long holiday and the Christmas celebrations with friends and family.

SunbeltNE wishes all its clients a Merry Christmas 2009.

Selling A Business? Be A Confident Seller

2009-12-07T10:50:00.002-05:00

Timing is of essence when you are selling a business. And selling your business when you are desperate is absolutely the wrong time to sell. Buyers can easily make out if there is a sense of urgency to sell a business through their interactions with sellers. If you are a business for sale owner, you may lose leverage in negotiations if you show any weakness on your part. If you want to successfully sell your business and avoid seeming desperate when negotiating, keep the following points in mind.

Take the help of experts

Business brokers are the most experienced people you can turn to if you want to sell your business successfully. You can seek advice from an experienced business broker to know what steps to take and how to act so that you can portray a strong and steady image. Expert advisors play a vital role in closing a successful business for sale deal. Ask your business broker a lot of questions and turn to him/her for advice when you think you are stuck in any situation.

Confidentiality

Confidentiality is of utmost importance when you want to sell a business. Tell no one outside your trusted circle of family, friends and business broker that you want to sell your business. You may be tempted to tell as many people as you can that you want to sell a business, in the hope that you come across a potential buyer. However, this will also alert all your employees and customers of the potential sale of business and they may start seeking your competitor to associate with. This will, in turn, have a negative impact on your business. Consider working with an experienced business broker, who can help you maintain confidentiality related to your business for sale.

Entertain multiple buyers

You can avoid a desperation situation for selling your business by having multiple offers on hand. For that, you need to entertain multiple buyers at the same time. Having only one interested buyer on hand puts a lot of negotiation power in that buyer’s hand, which is not good for you as a business for sale owner. An experienced business broker will have a large database of buyers which he/she can leverage to attract multiple buyers. Multiple offers will help you bargain for the best possible terms and price for selling your business.

Pricing the business for sale

Pricing is one issue which needs careful consideration. If you price your business too high, you may lose buyers who might have considered a fair price. On the other hand, if you are willing to sell a business for too low a price, buyers might question the profitability of the business. A fair price for your business for sale will attract more buyers than if you hike or lower your business for sale price. A business broker can also help you with business valuation, so that you can price your business reasonably.

Hiring A Business Broker? Look Out For These Red Flags

2009-11-27T06:52:00.004-05:00

If you are thinking of selling a business, you may be looking for a business broker who can help match you with an appropriate buyer. However, there are too many business for sale owners who have had their fingers burnt with wrong business brokers. We hence thought of listing down some red flags you should watch out for while looking for a business broker. Some of the red flags you should be aware of are as follows:

Huge Upfront Fees

Some business for sale owners have the bitter experience of paying upfront fees to business brokers and then regretting when, after months of being listed, their business still doesn't have any valid offers. Upfront fees may be a reasonable bet when one is dealing with the world's leading business brokerage firm. However, business brokers catering to the small business category normally charge per month or set up an agreement of commission on a successful deal. When selling a business, if a business broker asks for upfront fees just start looking at other business brokers.

Inability to Provide References

Another red flag about a business broker is his/her inability to provide a reference of past clients. References from past clients give you an idea of the methodology adapted by the broker in selling a business and the focus of the business broker in question. That too, from a seller's perspective. Feedback from past clients is an invaluable piece of information on basis of which you should decide whether to go for that business broker or not. If the business broker is unable to provide any such reference, forget him/her.

No Reports or Updates

You need to know exactly what activity is being undertaken to sell your business. You need a business broker who actively calls prospective buyers and not someone who just posts on business for sale websites or sends out mass mailers. Ask for regular updates on who is being contacted in the form of bi-weekly reports or personal meetings so that you are in the loop. An unscrupulous business broker may waste your time unnecessarily if you are careless in your dealings with him/her. Unless and until you are aware of what is happening, selling a business is not going to happen.

Inability to Prove Industry Experience

One must-ask question to a business broker should be: have you sold any businesses in my industry? A business for sale process closes faster if the business broker has experience in selling similar businesses. He/she will have a database of buyers if they have dealt with a similar business in the past. They will also know how to approach a buyer and have an inkling of the negotiation process. However, not a lot of brokers specialize in a particular industry. So if the broker has a lot of experience in selling a business, you might have to let go of the 'industry-experience' factor.

A business broker is the most important person you hire for your business for sale process. The value you get after selling a business is totally dependent on the business broker you hire. Keep the above-mentioned red flags in mind so that you hire the right broker for selling your business.

Happy Thanksgiving 2009

2009-11-26T02:13:00.004-05:00

It’s time to be thankful for all the good things in life: Thanksgiving 2009 is upon us. Thanksgiving holiday is the time when you gather with family and friends and say thanks for all the good things you have in life. It is a day for celebration, sharing and appreciation.

SunbeltNE wishes all its clients a very happy Thanksgiving 2009.

SunbeltNE takes this opportunity to thank all its clients for standing by it for so long and hopes this support will continue well into the coming years.

Selling A Business? Make It An Attractive Deal By Offering Seller Financing

2009-11-11T05:46:00.004-05:00

It is a fact that lesser deals have been made in buying or selling a business during the past year due to the recession. However, this is not due to lack of buyers in the market. There was a lot of buying interest in the past year, but many deals didn't close due to lack of financing. In this tight an economy, a buyer needs all the help he/she can get for buying a business. As a result of this, sellers who offer any kind of seller financing find it easier to sell business. If you are planning on selling a business, consider offering seller financing, as it makes it a more attractive deal for the buyer.

When you offer seller financing while selling a business, you agree to the buyer making an initial down payment and carrying a note for the rest of the purchase price. While this arrangement has always found favor with buyers, it is considered even more important in today's tight credit scenario. With seller financing, you may find it easier to sell business. However, there are some points to keep in mind when you decide to sell business with seller financing.

Make sure you get a down payment

Many sellers make the mistake of refusing to take the down payment after offering seller financing. Even though you are confident while selling a business that it will be profitable enough for the new buyer to be able to pay you back eventually, a down payment reduces the risk that you face in the future.

Assess the risks

Seller financing is nothing but an investment you are making. And like most investments, it has its risks. After an agreement has been entered into while selling a business, you need to wait patiently while the buyer develops the business, makes profit and returns the rest of the amount back to you. Profitability under the new owner is also not guaranteed, and you might end up making a loss if the new owner is not a sound businessman. Take into consideration all this before you sell business, as you need to be ready to tackle difficulties which may arise in the future.

Get professional assistance

A business deal always has a lot of complications which you might not be able to handle alone. Selling a business requires the help of professionals like business brokers, who are experts at documentation associated with selling a business. If you are also offering seller financing, you may require legal and financial advisors to ensure that the paperwork is impeccable and there are no complications after you sell business.

Use financing to your advantage

You may think that offering seller financing is one way of selling a business easily. However, seller financing may also turn out advantageous for you in the long run. Not only may it help you find a buyer for your business for sale easily, it may also allow you to sell business for more than its valuation. A buyer may be willing to pay a bit more if a seller is offering seller financing in times of tight credit situations.

There is no one-size-fits-all solution when you are selling a business. In case you have doubts on whether you should offer financing for selling your business, you should take advice from a person who has already sold a business with seller financing. That way, you can ask relevant questions relating to your situation and then decide whether it is the right step for you. All said and done, the final decision will be completely yours. But be sure to check all avenues related to seller financing before you sell business, so that you don't miss out on any advantages it could offer you.

HAPPY HALLOWEEN 2009!

2009-10-30T07:54:00.004-04:00

31st October, the Halloween day of 2009 is here! It's that time of the year when you can carve those pumpkins, wear your best Halloween costumes and go "Trick or Treat" from door to door. You can also look for special Halloween deals to get stuff you have been waiting to buy all year.

SunbeltNE wishes all its clients a very happy Halloween 2009.

Selling A Business? Keep These 5 Tips In Mind

2009-09-25T10:22:00.005-04:00

Are you thinking of selling a business? Does the process sound complicated and confusing? Are you wondering where to start? What things to keep in mind? Well we have compiled some tips which will nudge you in the right direction and clear up some of that confusion. The following are five tips which will help you when you are selling a business:

Decide on a Realistic Selling Price

Many business sellers, in their zest to sell a business, over-price their businesses while listing it for sale. This is a huge mistake; business buyers now are smart enough to get business valuations and will immediately close any negotiations when they come to know that the business for sale is over-priced. Business buyers are also wary of under-priced businesses, which make them suspect that something is amiss. So when you think of selling a business, take the help of a professional for business valuation or a business broker, which will help you in deciding on a realistic selling price for your business for sale.

Keep your Terms Negotiable

The terms and conditions attached to your business for sale should be negotiable to a certain extent. Analyze the goals you wish to achieve by selling a business and then decide on the terms that you are willing to negotiate and those which you are not. If you are too rigid in your terms and conditions, you may not find a taker for your business for sale.

Focus on Running your Business Normally

Many business owners stop focusing on their business the minute they put it up for sale. If you are thinking of selling a business, remember that it may take anywhere from three to six months to close a successful deal. Within that time, if you let your business slip, the price as well as demand for your business for sale will diminish. Hire a professional like a business broker who can focus on selling a business for you, while you can concentrate on conducting business as usual.

Have Impeccable Financial Records

Financial records and books of accounts are the main considerations for people looking to buy a business. Healthy books of accounts and impeccable paper work will help in selling a business more than any amount you spend on advertising a business for sale. A clear picture of your business's finances is the best selling point for your business for sale and will help the buyer decide whether your business is worth buying or not.

Help the Buyer Out

Take it upon yourself to be as helpful to the potential buyer as you can. Selling a business is only successful when you give all the information to the person thinking of buying it. The more information the buyer will have about your business, the better he/she will be able to judge it. Be as helpful to the buyer as you can. This will not only help you break the ice with him/her, it will also help him/her in making the decision; it might hence aid in closing a successful business for sale deal.

Selling a business is a complicated procedure, which you need to be careful about, if you want to achieve your business selling goals. Keep the above-mentioned tips in mind when you put your business up for sale, and it will ease the process a bit for you. Also take the help of a professional business broker who can ensure that your business goes in the right hands and you achieve the goals you have set for yourself.

Selling A Business Through A Business Broker? Some Pros And Cons

2009-09-08T07:47:00.005-04:00

For businessmen who are keen on selling a business, the prospect of using a business broker is an exciting one. As a professional, a business broker is more than just a middle man for the deal; he/she helps in business valuation, marketing the business for sale as well as retaining the attention of an interested buyer. Using a business broker for a business for sale deal is a very good idea for a number of reasons as listed below:

Business brokers, with their experience, can not only market your business for sale in the right manner, but they can also find the right buyer and get a great price for your business for sale. Good business brokers have great negotiating skills, which they employ to get the maximum possible price for your business. You can hence achieve your goals of selling a business with ease.

The right business broker can help with the valuation of your business for sale, so that you know what price to expect and sell your business for. Pricing the business right is crucial for closing a successful business for sale deal; a business broker is a vital help for this purpose.
Professional business brokers are also a confidential lot. They work in a confidential manner, ensuring that news does not leak out that you have put up your business for sale. You can hence rest assured that your customers, employees, competitors or others do not know that you are selling a business.
In addition to making your business for sale look like an attractive deal, the business broker can also use his/her network and alert the majority of buyers that your business is up for sale. The business broker then acts as an intermediary between you and the buyer until a successful deal is etched out. Along the way, the business broker will also advice you as to which steps are in your best interest. With such a professional dedicatedly working for your cause, you will be less worried about selling a business and can concentrate on growing your business until it is sold.

Having discussed the pros, there are also some cons of working with a business broker which need to be mentioned here.

Sometimes the fees or brokerage of business brokers are so high that many sellers consider trying to sell a business on their own. Brokers charge anything between 5-20% as fees, which some business for sale owners may be unwilling to pay. However, despite the high fees, the experience of a business broker is an advantage a seller cannot afford to ignore.

Another point to consider is the challenge in finding a good business broker, who keeps in mind your interests rather than his/her own fees. If you are thinking of selling a business, always remember that the competency levels of different business brokers are different. Landing up with an incompetent or inexperienced professional can cost a business for sale owner more than the high fees of a good business broker.

Working with a business broker for selling a business can be a very advantageous decision for your business for sale. You just need to select a good business broker who is experienced in selling businesses and has your best interests at heart.

Selling a business? Learn to spot a good business broker

2009-08-28T07:04:00.011-04:00

You may have considered availing of the services of a business broker if you are thinking of selling your business. Although hiring a business broker is the best step you can take, it is important to differentiate a good business broker from a bad one. A lot of businessmen fail to spot the shady business brokers from the really experienced ones, assuming that all brokers are honest and experienced. But this is a wrong assumption. As a business for sale owner, you need to realize that there are some unprofessional business brokers out there, and only if manage to find a good one will you be able to sell your business successfully. The following are a few factors you can take into consideration for judging a business broker:

Morality or Ethics

Lack of ethics is a classic characteristic of a bad business broker. Major botch ups related to selling a business are due to the fact that the concerned person failed to adhere to commonly-accepted ethics in the industry. However, there is no tested way of measuring the concerned person's ethics. The most you can do to ensure that your business broker is sound in ethics is ensure that he/she is a Certified Business Intermediary (CBI) from the International Business Brokers Association (IBBA). This is in no way a guarantee of morality, but at least the business broker will follow the code of conduct set by a professional body like IBBA.

Integrity

Again, the integrity or honesty of a business broker is not easy to judge. But if you want to sell your business successfully, you need to assure yourself that your business broker will be honest with you throughout the deal. You can question the concerned person in detail and judge him/her by the answers you receive. Was the business broker clear in their answer? Was he/she willing to sit down with you and discuss all issues? Was he/she vague or forthcoming in the answers?

Capability for Promotion

Selling your business is totally dependent on your business broker's promotional capabilities. If he/she is not able to market it properly, prospective buyers will not even come to know that your business is up for sale. Discuss with your business broker how exactly your business for sale is going to be promoted. Unethical business brokers merely post your business details on the internet and charge you a hefty fee for nothing. As opposed to this, good business brokers have a set procedure which they follow for promotion, which includes sending the information via email and post to their list of buyers, networking with them etc. Only through constant exposure to potential buyers will you be able to sell a business successfully.

Established Network

Experienced business brokers who have been in the industry for a long time will have listings of buyers whom they can get in touch with immediately. They will also have network of professionals who will know who is in the market, looking to buy. Selling your business will be a success only if this network is put to work for your business for sale.

Reputation

A good business broker's reputation will not only be verifiable through his/her past clients, but also other professionals who are involved in the business selling process, like accountants, investment bankers, attorneys etc. Talk to other people who are not related to the business broker directly but are likely to have an idea regarding his/her reputation. What other people think of the person concerned will say a lot about his/her professional capabilities, reputation and experience.

Skills and Experience

Interview potential business brokers personally. The way they answer your questions will tell you a lot about their skills as well as experience. Their knowledge about business buying and selling will also reflect in the way they handle your inquiries. Talking to past clients is also a must for judging skills related to selling a business. Make sure you get in touch with them and discuss the pros and cons of working with the business broker in question.

Following the above-mentioned steps will ensure that you have at least an idea of what kind of business broker you are dealing with. But rest assured that when you finally find a good professional, your partnership will result in you selling your business successfully.

7 Steps Of Selling Your Business

2009-08-18T09:35:00.004-04:00

Closing a successful business for sale deal is a tough task and will require a lot of your time and effort if you are planning to sell your business. The following are some pointers which should guide you through the process:

Get your business for sale valued

Valuation of your business for sale is the first step in getting the process of selling a business started. You should get an expert valuation firm into the picture which can give you a realistic idea of your business worth. You can get your business valued through a number of sources like experienced business brokers, investment banking firms etc. On basis of this valuation, you can decide the asking price, the terms and conditions and also know the market position your business for sale holds.

Be aware of why you are putting up your business for sale

Why are you putting up your business for sale? This is a question business brokers as well as buyers will be interested in getting an answer to. "If it is doing so good, why are you selling?" is a valid question from any buyer. You may be selling your business because you are thinking of retiring, changing your line of business or simply because you need funds. The reason you are putting up your business for sale has to be clear in your mind right from the start.

Have your financials in order

The business for sale process actually gains momentum when a buyer takes interest in buying your business. The interested buyer will generally require at least three years' financial information for your business in order to judge its feasibility. Hence, if you want to successfully sell business, your books of accounts need to be perfectly maintained by a professional.

Have reasonable expectations

Some businessmen put up their business for sale with such high expectations regarding price and terms that finding a buyer to meet them may become tough. Enter the market with reasonable expectations which match with the level of your business. If you expect $1,00,000 for a business which has a valuation of $60,000, you are never going to be able to sell your business. Consult a good business broker who will help you set realistic goals.

Make a good first impression

When you meet potential buyers, you need to make a good first impression. Your business should be organized, well-managed and profitable to be able to convince the buyer to invest in it. Before you put up your business for sale, ask yourself this: Is my business attractive enough to capture the interest of a buyer? Or does it need to be organized in a better way before I put it on the market? Make necessary changes to your business if you think it will make a difference in selling your business successfully. Your business broker will be able to guide you about the expectations of buyers and whether your business meets them or not.

Keep focusing on your business for sale

Once you make a decision to sell business, don't neglect it. Don't focus on sale of business so much that the profitability deteriorates and buyers get a chance to offer you a lower deal. Consider the business your own and run it efficiently until the moment it changes hands.

Hire a professional to help you

And finally, get the help of a professional business broker who can guide you step-by-step until you sell your business successfully. Business brokers have a detailed idea about the business for sale process and will also be able to answer any queries you have along the way.

Keeping these points in mind will ease the business for sale process for you and help you close a successful deal.

Selling a Business? 4 Characteristics You Should Look For In A Good Business Broker

2009-07-29T08:41:00.005-04:00

Selling a business is a once in a lifetime occurrence for many small business owners. If you are a small business owner thinking of selling your business, you might be thinking of hiring a good business broker to help you achieve your goals. But how do you go about selecting the right one for you? How do you identify the characteristics YOUR business broker should come with? We thought of making the task easier for you by compiling some essential characteristics of a good business broker.

Track Record or Experience

This is the first and foremost characteristic you should judge any prospective business broker by. The experience of any business brokerage firm is very important aspect in selling a business. Extensive experience in selling a business will ensure that the process for selling business is well designed and successful. It also means that the business broker will have an established network or a list of buyers, increasing the chances of making a successful business sale.

Background

Some questions that you should ask a business broker regarding his/her background are: What type of businesses have you dealt in till now? Which industry have you sold most businesses in? What qualification or business education do you possess?

The business broker you require should be well qualified as well as have experience in selling businesses in your industry or domain. If this background of the broker matches with your requirements, you can rest assured that you have an expert at work for selling your business.

Proactive Approach

Only if your business broker goes out there proactively to search for an appropriate buyer for your business will you be able to successfully sell your business. Once the broker has understood your requirements for a buyer, he/she should start aggressive marketing to bring your business to the attention of buyers. A good business broker has the ability to get your business constant exposure to potential buyers, which increases the chances of a successful sale of business.

Compatibility

In order to close a successful deal, you need to ensure that your business broker is compatible with you. Ask yourself whether you will be able to work with the person in question till the deal is finalized and whether he/she understands your goals properly. In the lengthy and complicated process of selling a business, many deals have failed to materialize due to the non-compatibility of the sellers and their business brokers. Avoid this problem by interacting with the business broker in question several times and observing his/her demeanor to ensure compatibility.

Finding an appropriate business brokerage firm is half the task done; the firm will then become a powerful tool for your search for the right buyer for selling your business. Select a business broker keeping the above-mentioned points in mind, and you will be one step closer to a successful deal.

6 Mistakes a Business for Sale Owner Should Avoid while Selling a Business

2009-07-17T10:05:00.006-04:00

Putting up a business for sale is a life-changing decision, one that has the potential to accomplish your life's goals. You want to see the business you built from scratch go into the right hands at the price you deserve for it. But closing a successful deal for a business for sale is not as easy as it sounds. The entire business selling process is a complicated one. We've compiled some commonly observed mistakes which you can keep in mind while planning to sell your business.

Not Enough Preparation for the Sale

Selling a business requires a lot of planning and preparation, at the end of which you can expect to close a successful deal. Before even considering putting up your business for sale, you need to evaluate your goals and what you wish to achieve through the sale. Once you have your goals chalked out, you can go about finding out how to achieve them. Remember, it takes anywhere between a few months to a year for a business sale to take place. Without preparation, it may take even longer or result in no deal at all.

Wrong Timing

The right time to sell a business is not necessarily when your business is not doing well; it is when your profits are at its best. The timing is a crucial factor in making or breaking a business for sale deal. So don't wait for your business performance to move southwards before you start thinking of selling it. Putting up a business for sale when it's not doing well can make it a hard deal to bargain for. Instead keep the sale of your business always on your mind, especially when it is doing well. If you sell at a time when you have no other choice, you will lose the winning edge for making the deal. A great profit statement is hence your best selling point.

Over Pricing or Under Pricing your Business

Pricing is another issue which breaks deals many a times. While looking at a business for sale, a buyer will look at its turnover, profits and financial situation to judge how much he/she should pay for it. If you demand an unreasonable price, the buyer will be put off even before negotiations begin. Many sellers also make the mistake of under pricing their business for sale, thinking that it will attract more buyers. In fact, all an under-priced deal does is put the doubts regarding the feasibility of the business in the buyer's mind. Ask your business broker to get a fair business valuation which will give you an idea of the asking price to put on your business for sale.

Lack of Financial Details or Information

A buyer judges the potential for a business for sale through the financial documents and information that you provide him/her with. Lack of such details is a deal killer. So have all business documents and financial details prepared in advance so that the buyer may judge the feasibility of the deal quickly and you can sell your business with ease.

Selling to the First Bidder

In one's haste to close the deal, it is very tempting to accept the first bid for a business for sale. But having only one offer makes the seller lose ground in negotiations and doesn't necessarily bring in the best price. Consider all the options you have and select the buyer you think will be able to run your business successfully in the future.

Trying to Sell without a Business Broker

This is a mistake many businessmen make while putting up their business for sale. Managing your business efficiently and trying to sell a business are both full time jobs. It's difficult for one person to juggle both since each needs a dedicated person to look after it. If you try to do both at once, one of the 2 things will happen: you will either be unable to look after your day to day business while looking for a buyer or you will be unable to find the right buyer. The solution to this dilemma is simple: hire a professional business broker. A business broker will not only know how and where to look for people looking to buy a business, he/she will also be able to handle tough negotiations on your behalf. The cost of a business broker will be worth it when you will have made a successful deal, with your business sold to an appropriate buyer.

Avoiding the above-mentioned mistakes while selling your business will go a long way in eliminating the hurdles to a successful business for sale deal.

Selling a Business: The Minutiae of the Process

2009-06-18T02:56:00.048-04:00

There is a flood of people who are interested in selling their business in the market right now. On one hand, the recession has forced many businessmen to reconsider their goals and many are opting out of the businesses they started with much vigor. On the other hand, the baby boomer generation, which is now in its early to mid sixties and forms a major chunk of entrepreneurs in the United States, is thinking of retirement.

But the process of selling a business is not so simple for entrepreneurs in this sinking economy as it was some time back. Businessmen may have spent months preparing for the sale of a business and still not manage to get a good deal meeting their terms. So what are the strategies that drive successful sale of businesses? As per Satish Patel, CEO and President of SunbeltNE, franchise of the world’s largest business brokerage network, “It is necessary to implement some strategies in order to ensure that selling your business ends on a successful note.” The following are some points one should keep in mind while preparing to sell a business:

• Prepare for selling your business well in advance

Depending on the nature and success of your business, the industry you are in, the complications related to getting the finances, the price you are looking for your business and various other factors - it may take anywhere from a few months to a year or so to sell your business. Business owners should start sale preparations well in advance and consult with an experience d business broker or investment banker to handle the nitty-gritty of the sale of business.

• Develop and grow if you want to successfully sell your business

Smart business owners do not stop focusing on their businesses while they are looking for people to buy a business. Instead, they focus harder and try to attain more success for their business. A growing graph convinces a buyer to buy a business more than any other marketing method. Also be prepared to finance the buyer when you are selling your business so that in a credit-crunched market like now, you make a strong case for yourself.

• Sell your business at a reasonable price
In a harsh market like now, you cannot have unreasonable expectations like a 100% cash deal or getting 20-25% in grace value of your business. You should expect to sell your business at a reasonable price, close to the valuation it actually has. A fair price is likely to attract a buyer and also form a good working relation in case you plan to be involved in the business after the deal is done.

• Using a business broker for selling your business

If you try to go the ‘do-it-yourself’ way, you will probably miss out on important issues regarding the sale of your business. The paperwork of a business for sale is highly complicated and a business broker would go a long way in easing out the process for you. The right business broker will bring to the table a database of qualified buyers. This gives you the choice of picking out the best one. It will be worth hiring a professional business broker considering that he will ease the process of selling your business and will have your best interests in mind.

You can always keep these strategies in mind when you are planning the sale of your business. They will ensure that you are successful in etching out a great deal for yourself.

Sunbelt New England was Very Well-Received in the New England Xpo for Business

2009-06-01T05:05:00.005-04:00

- The expert business brokerage firm connected with visitors and helped solve their doubts at the Xpo -

New England hosted the Xpo for Business for the first time on 19th May this year. Sunbelt Business Sales and Acquisitions, New England (SunbeltNE), one of the top franchises of Sunbelt Network participated in the highly anticipated B2B show. The Xpo had over 400 exhibits of innovative products and services which visitors could tap into for information. Visitors appreciated the chance to interact with experts in small business and have their doubts solved.

“The Xpo for Business has become a brand name in itself and we were glad that New England could host the show this time around,” said Satish Patel, Founder, CEO and President of SunbeltNE. “We had the opportunity to learn about the major problems small business owners face. A lot of visitors came to us with their doubts and we are glad that we were able to help them. Our participation at this Xpo has gotten us a phenomenal response.”

About SunbeltNE

SunbeltNE provides advisory services for buying and selling business across the U.S. and is one of the most renowned business brokers of the New England region. SunbeltNE also holds franchises for the states of Massachusetts, Rhode Island, Vermont, New Hampshire and Maine. With SunbeltNE, sellers can derive the maximum value for their business while buyers get access to varied buying options. To know more about SunbeltNE, visit http://www.sunbeltne.com/.

5 Tips to Sell your Business through a Business Broker

2009-05-20T05:46:00.008-04:00

Does the process of selling your business seem lengthy and confusing to you? Get professional help with an experienced business broker. The advantages of working with business brokers for selling a business are many:

They know the process of a business sale thoroughly that saves your time

They possess strong negotiating skills to get you the best price for your business

Business brokers have the knowledge and expertise for a successful deal close

For selecting and hiring the right business broker for selling a business, the following tips will help you out:

Before you actually go looking for a business broker, you need to be clear in your own mind of the objective behind selling your business. Is it just the money crunch, the eagerness try something else or are your personal priorities forcing you to exit? You should address key issues like: the type of valuation you want for the business; whether you want to stay on after the transfer of ownership; whether you are open for seller financing etc.

Equally important is deciding which type of business broker will work the best for selling your business. You can determine the type of business broker you want by their experience, team of advisors, track record of successfully closed deals, exposure to your industry etc. For example, if you have a $1 million company, a large business brokerage firm would probably not be interested in selling your business.
Once you actually start looking for a professional business broker, give importance to the compatibility factor. Ask yourself whether you will be able to work with him/her to sell your business successfully to get the best possible deal. You have to explain your objectives of selling your business to the business broker and then judge whether he/she understands your goals properly.

Ensure that you understand the process of selling your business completely by discussing it in detail with your business broker. You should be comfortable with the process as well as confident that it will result in the successful sale of your business.

Make sure that you obtain a detailed quote from the business broker and understand the basis of the charges and expenses mentioned in it. You don’t want to be arguing for unjustified charges for selling your business. Ask the business broker specific questions in case of doubts, and clarify them before confirming him/her.

These tips will help you find a business broker who will have your best interests at heart. Otherwise, you will spend a lot of time searching for and negotiating with the right buyer to sell your business. A good business broker will increase the value of the transaction and justify the fees he/she charges.

3 Questions to Ask your Business Broker Before Buying a Business Franchise

2009-04-24T02:47:00.007-04:00

Franchises are a Great Concoction for Business

Consider buying a business franchise with a little help from your business broker in case the current recession is tipping you towards entrepreneurship rather than undertaking an unstable job. A franchise has all the ingredients for a successful business: a tried and tested business formula which can be easily duplicated; a well-established reputation and brand name; a loyal customer base; and over and above all, minimum risk when one is buying a business. If you are new to doing business, buying a business franchise is a great way to enhance your entrepreneurial career. What’s even better is buying an existing franchise, which lets you hit the ground running right from day one. That way, you can combine the best of both worlds: the track record of an existing business and the concept of a franchise.

An established franchise for resale is hard to find when you are looking to buy a business. For your search, you can enlist an experienced business broker to help you out. Business brokers have listings for businesses for sale, and you might find a seller who wants to sell a business franchise. Business brokers are also aware of the various types of business franchises in the market and will be able to help you find one that matches with your business skills and expectations.

How to Research for Buying a Business Franchise

Once you identify your preferred brand you for buying an existing business franchise, undertake some research in conjunction with your business broker so that you become aware of the market conditions and success strategies. Only if you interact with your business broker and other franchise owners will you be able to judge whether buying a business franchise of that brand is in your best interest or not. Some key questions to ask your business broker and other franchisees are mentioned below.

Ask your business broker the following 3 question before buying a business franchise:

What is the number one focus of the franchisor?

You want to buy a business franchise of a franchisor that has your best interest in mind, so the answer you are looking for is “His number one focus is the success of all his franchisees.” If you get an answer like “The franchisor’s core focus is his own profitability”, it shows that the franchisor is only concerned about his own benefits.
What problems do the other franchisees face?

Your business broker will also be aware of some of the problems franchisees face. While buying a business franchise, you should be aware of the problems commonly faced by other franchisees and how to deal with them. The business broker is the best person to talk to regarding this.
How does the franchisor resolve conflicts?

Your business broker will most probably know the franchisor’s ability to solve conflicts within franchisees. Buy a business franchise only if you are convinced of the franchisor’s ability to resolve conflicts and his total dedication to the business.

Additionally buy your business franchise after asking the following 3 questions to other franchisees:

What preparation did you undertake when you took the plunge?
What kind of marketing campaigns attract customers to the franchise?
What kind of financial implications does buying a business franchise have?

Such interactions with the business broker and other franchisees will help you make a decision on if that particular brand of franchise is the right one to buy. After all, buying any business is a life changing decision and will remain with you for years to come.

Selling a Business? Get into the Buyer’s Mindset

2009-04-07T07:08:00.004-04:00

If you are looking to sell your existing business, you need to find the right buyer. And in order to find the right person to buy your business, you need to get into the buyer’s mindset in order to figure out what factors influence their buying decision. Such an insight will help you best customize your selling pitch accordingly. But how do you figure out what a buyer is thinking while buying a business or franchise? What factors influence him/her in making the decision? Which are the factors you need to be aware of in order to convince the buyer to buy your business? The answer to these questions is important in making sure you can successfully sell a business to the right buyer.

Some of the common factors that influence the buyers to buy a business are:

Entry into a new market: an acquisition of your business may be a means to enter the market for the buyer. For example, buying a business in the restaurant industry may be a way for a food manufacturer to get into the main street business.
Elimination of competition: if you are a competitor who takes away a significant value of business from the buyer, he/she might decide to buy the business from you. That way, for the buyer, another business from the same industry can be integrated into the existing business as well as the competition can be eliminated.
Merger and acquisition: if expansion is on the agenda for the business, the buyer might look for merger and acquisition opportunities by buying a business. This way, the market share of the buyer will increase and expansion can be possible.
Increasing the value of the original business: if your business is on the same lines of the buyer’s existing business, he might want to buy your business to increase the value of his own business.
To fill gaps in products or services: in case your business is well established, has a brand name or offers a better product or service offering than the buyer’s own business, he/she might consider buying your business to fill gaps in their own products or services.
To add intellectual or physical property to their rooster: if you possess a valued intellectual or physical property, it might become an attraction for the buyer. This way, the buyer’s business value as well as market offering is liable to increase.
Company reputation and brand name: most buyers consider a well established business a good investment. So if your company has experience, is well respected and has a brand name, it will become a major pull and will be a convincing factor to buy your business.

The factors mentioned above cover the most common reasons for buyers to buy a business. However, in case of individuals, there might be other factors which lead to the decision e.g. emotional factors, finance etc. These factors differ from person to person and are very individualized. You can consult with a professional business broker for guidance for finding a right buyer and get the right value for your business.

You need to be aware of the factors mentioned above when you are on the lookout for a buyer for selling a business. If you are successful in getting into the mindset of the prospective buyers, you will be able to better understand them as well as their buying requirements and will be able to convince them to buy your business.

Do you need a Business Broker for Selling your Business?

2009-03-20T02:21:00.004-04:00

If you are thinking of selling your business, there are probably many issues you are worrying about. After all, selling your business is a critical decision: you want to get the right price for your life’s work as well as want it to go in the right hands. Due diligence, business valuation, deal financing, legal and accounting issues, and most importantly, finding the right buyer for your business: these and many more are issues that will need the guidance of an expert business brokerage firm. A business broker will be able to help you sail through this entire process with ease. If all the above-mentioned information sounds Greek to you, read on for a detailed explanation.

If you are unaware of the minutia involved in selling a business and still want to hit the ground running, you should hire the services of a business broker or an intermediary. Do not be leery of relying on an expert business broker, because he or she is an experienced professional in buying a business or selling a business, and will be the best guide on how to find you the perfect buyer. So let’s cut to the chase and examine why you need a business broker.

3 things the business broker has that you don’t have:

Huge Listings of buyers and a strong network of contacts

The listings the business broker has will help you find the most appropriate buyer for your business as well as get the best price for your business. Expert business brokers generally have a strong network of contacts which enables them to get an update on the people who are looking to buy an existing business.

Experience in buying and selling a business

You don’t buy and sell a business every few months, but your broker does. Trust his experience and his valuable insights to find the perfect buyer for your business.

Niche skills for closing the deal

Business brokers are aware of the processes involved in buying or selling businesses. They will not only get you an interested buyer with the best quote for your business, but will also help you overcome every hurdle related to the accounting, tax and legal matters.

But how do you know who should be your right choice for a business broker?

Don’t miss to ask these questions before you chose to hire a business broker:

What kind of team does he/she have?

What has been his/her ratio of successfully closed deals in the past one year?

How many years is his/her overall experience as a business broker?

Which type of businesses has he/she been highly successful with?

Can he/she provide you with references of some recently closed deals?

What kind of buyer listings does he/she have?

What would be his/her brokerage fee?

Selling a business can be a very daunting task but if you search for a business broker on basis of the above-mentioned guidelines, you are most likely to find the right business brokerage firm to help you through the entire process.

Getting to the Heart of Business Valuation - V (Tips to increase Value of Business)

2009-03-05T06:43:00.008-05:00

‘Getting to the Heart of Business Valuation -5 part Series’ helps you grasp the core fundamentals of business valuation procedure. Areas covered were selecting the right business valuator, types of business valuation, checklists of documents and information to keep ready for business valuation and finally we discussed the business valuation process.

We conclude this mini 5 part series, with this last topic which highlights essential tips to increase value of business to ensure business sale is favorable.

Check out the following healthy signs, and then listen to the heartbeat of your own business and its leadership style:

Optimistic Attitude

Many business owners today are more pragmatic and take pride in being less of an “incurable optimist.” In a world driven by technology and scientific analysis, it’s easy to forget the importance of the right attitude. If business owners aren’t positive, how can they expect customers and employers to be? The owner who believes business is bad will probably not see it getting any better.

How to project a positive attitude? Begin with the easiest. Sprucing up the place of business with fresh paint, newly-cleaned carpeting, well-stocked shelves, for example, will say a lot for the health of a company. Less visible, but highly important, is a positive outlook on the future of the business. Business owners should be prepared to spend what it takes to generate new business, and should take the time to outline new possibilities for long-range success. If the company currently has no mission statement or business plan, creating one will speak volumes about owner’s enthusiasm for the future of the operation. This will make the overall profile very attractive to prospective business buyers.

Healthy Managerial Style

In the modern workplace, where you can hardly see the business through the forest of “managers,” it’s good to get back to basics. Too often owners get bogged down in busy work, or in “managing the managers.” Owners who put themselves in the trenches are in touch with the business -- and this first-hand understanding will be evident to anyone taking stock of the company’s worth.

An equally healthy approach to managing is preparing for contingencies. The owner’s style should include appropriate delegation of duties and a backup managerial plan in case of unforeseen calamity.

And finally, owners should project a general sense of well-being and energy. Give valid reasons to make a killing at the negotiation table and sell a business at good price by showing futuristic opportunities to grow. Anyone taking stock of a business will draw a quick impression from the very posture and tone of voice the owner presents.

Conspicuous Image

To foster the image of an on-going, healthy business concern, business owners need to keep their image prominent before the public. Advertising can build image at the same time it attracts business. Anything from a display ad within the yellow pages listings, to a monthly company newsletter, to the offering free seminars, can portray the business as more than just the sum of its products.

Community Involvement

To further promote the business -- and its owner -- as a rock-solid and permanent part of the local scene, there are opportunities just waiting to be tapped. Taking an active role in the Chamber of Commerce, trade or service associations, and sponsorship of worthy local events is great public relations.

To find the real value of a business, go to its very heart: the attitude, work habits, managerial style, customer/marketplace savvy, and community reputation of the person in charge. The business owner or manager is the final, and most cogent, indicator of business worth.

Dollars and cents will always be important in establishing value, but it’s a kind of people-sense that will give the truest meaning for business value. Establish value for your business in truest sense and see the market value soar and overall win-win situation while selling business!

Getting to the Heart of Business Valuation- IV (Business Valuation Process)

2009-02-03T00:37:00.004-05:00

After tackling issues like how to select the right business evaluator and understanding the various methods of a business valuation, and checklist of documents to be kept ready, this post will talk about the business valuation process adopted by SunbeltNE business brokers. Adopting a right business valuation process ensures the sale of business will bring in a better sale price compared to arbitrary valuation of business.

Step 1: The Broker meets with the client to determine what type of valuation is required.

Step 2: During the meeting, the Broker will assist in the completion of the Company Profile information needed for the type of valuation selected.

Step 3: Once the Company Profile has been completed and the required financial, company and other general documents and information are obtained, the package of information is mailed, faxed, or emailed to third party Valuation Analyst.

Step 4: The Valuation Analyst will review the documents and begin the valuation. During this process, if the Analyst has any questions or requires additional information, he will contact the Broker to obtain them.

Step 5: The valuation process for a Snapshot, Value Analysis, or Limited Formal will be taken with the help of required financial information. A completed Company Profile is then generated, and all questions that arise are answered. The Mergers and Acquisitions and all Comprehensive reports will take time due to the complexity of the valuation.

Step 6: The Analyst will issue a preliminary review of the valuation. This review is critical to the final report. It assures that all details have been considered and allows for any adjustments that may need to be made based on new information or further clarifications.

Step 7: Once the review with the Broker has been conducted, the Analyst will finalize, print, and send the final valuation report.

Step 8: The Broker will receive hard copies and an electronic copy (if requested) of the final report. This report is sent to the business seller/owner. Thus a planned business valuation involves lot of procedures and systematic planning to ensure the right value is found out to help sell business.

To know more information about SunbeltNE’s business valuation services.

Getting to the Heart of Business Valuation - III (Checklist of documents & information required)

2009-01-08T04:56:00.007-05:00

Previous posts took you through a quick overview of how you can select the right business valuation professional, the various methods of business valuation to begin your planned exit strategy to sell a business.

Let us proceed to have a quick review of the documents and information to be kept ready to conduct a thorough and fair valuation of the business. Also note that all these information will also help the business buyer to conduct due diligence and make the process of selling a business quick and smooth.

Following is a checklist of documents and information that professional business advisors ask prior business valuation:

Financial Statements:

Balance sheets, income statements, statements of changes in financial position, and statements of stockholders’ equity or partners’ capital accounts for up to the last five fiscal years, if available.
Income tax returns for the same number of years.
Latest interim statements if valuation date is 90 days or more beyond end of last fiscal year and interim statement for the comparable period the year before.
Prepare a list of subsidiaries and/or financial interests in other companies (if any) along with relevant financial statements of such a company.
Equipment list and depreciation schedule.
Aged accounts receivable list.
Aged accounts payable list.
List of prepaid expenses.
Inventory list, with any necessary information on inventory accounting policies (including work in progress, if applicable).
Lease or leases (if lease does not exist or is not transferable, determine what new lease or rental terms will be).
Any other existing contracts (employment agreements, covenants not to compete, supplier and franchise agreements, customer agreements, royalty agreements, equipment lease or rental contracts, loan agreements, labor contracts, employee benefit plans, etc.
List of stockholders or partners, with number of shares owned by each or percentage of each partner’s interest in earnings and capital.
Compensation schedule for owners, including all benefits and personal expenses.
Schedule of insurance in force (key-man life, property and casualty, liability).
Budgets or projections, if available.

Company Documents

If a Corporation, articles of incorporation, by-laws, any amendments to either, and corporate minutes.
If a Partnership, articles of partnership, with any amendments.
List of existing buy/sell agreements, options to purchase stock or partnership interest, or rights of first refusal.

Other Information

Brief history and details of any changes in ownership and/or bona-fide offers received.
Brief description of business which includes position as compared to competitors and any factors that make the business unique.
Marketing literature (catalogs, brochures, advertisements, etc.)
List of locations where company operates, with details provided in terms of size, and whether owned or leased.
List of states in which the company is licensed to do business.
If customer or supplier base is concentrated, list of major accounts, with annual dollar volume for each.
List of competitors, with location, relative size, and any other relevant factors.
Resumes of, or list of, key personnel, with age, position, compensation, length of service, education and prior experience.
List of memberships with Trade associations or would be eligible for membership.
Information of relevant trade or government publications which features the company.
Collect existing indicators of asset values, including latest property tax assessments and any appraisals that have been done.
List of patents, copyrights, trademarks, and other intangible assets.
Any contingent or off-balance-sheet assets or liabilities (pending lawsuits, compliance requirements, warranty or other product liability, etc.)
List of any filings or correspondence with regulatory agencies regarding issues related to business.
List out major highlights of prior business transactions.

Don’t get bogged down by the long list. If you hire a professional business valuation firm they will already have a team of staff to help you gather all the relevant paper work to ensure business sale is smooth and favorable of the business seller. Next post we will discuss the business valuation process in brief.

Disclaimer: This blog is for information purpose only. It is intended to discuss in brief about commonly followed practice or industry-known principles, Applicability of this information is subject to change from time-to-time or might differ from case-to-case basis. Readers are requested to verify their case facts with a qualified Business Valuation professional.

Getting to the Heart of Business Valuation - II (Types of Business Valuations)

2008-11-28T03:04:00.006-05:00

The previous post discussed how you can go about selecting the right evaluator to value your business before you plan to sell a business. This post we go to the next step: Understand the various business valuation methods.

There are many methods to find the value of business but the most popular methods adopted by professional and experienced business brokers are the following:

Letter of Opinion:

The Letter of Opinion is a restricted use valuation intended for small companies with sales less than $250,000. The report runs to approximately 10-12 pages and provides only a brief synopsis of how the valuation conclusion was determined. The basis of this valuation is a market comparison with like companies within an industry.

Value Analysis:

The Value Analysis is a restricted use business valuation designed specifically for the “main street” business with sales of $1,000,000 or less. The report is intended for “asset sale, financial buyers” and provides only a summary of how the valuation conclusion was determined. The basis of this valuation is discretionary cash flow, since most Main Street businesses are bought and sold on a multiple of annual cash flow. The value considers primarily historical and current financial performance and very little time is spent with the Balance Sheet.

Formal Business Valuation:

The Limited Formal Valuation is a restricted use business valuation intended for the standard small business with sales between $1,000,000 and $5,000,000. The report is intended for “asset sale, financial buyers” providing a detailed review of all aspects that were considered in determining the final valuation conclusion. The bulk of the report is financial analysis and the valuation conclusion is supported in much more detail. In addition to reviewing the company’s historical and projected earnings, the report also contains a detailed review of the Balance Sheet.

M&A Valuation:

The Mergers and Acquisitions Valuation is a comprehensive business valuation for transactional purposes and is developed in accordance with the Uniform Standards of Professional Appraisal Practice (USPAP). This is a stock valuation and is intended for the middle market business with annual revenues in excess of $5,000,000, businesses that are expected to sell for more than $1,000,000, strategic acquisitions of niche businesses, and generally any business with significant growth expected in the future. The basis of the valuation is focused on future earnings and the selection of guideline companies comes from both the private and public markets.

IRS Revenue Ruling 59-60:

A USPAP governed valuation developed for litigation focusing on US Court Reviews, Cited Court Precedents, and in-depth analysis and research of minority and marketability discounts. This method is intended for Estate Tax, Gift Tax, ESOP’s, Divorce, and any situation requiring litigation. This valuation is normally used when the value of the stock is in question (minority or majority interest).

Now that we have discussed how to select the right business evaluator for your business and the methods of valuing a business the next logical step is to understand the business valuation process. The next post will discuss about the business valuation process.

Disclaimer : This blog is for information purpose only . It is intended to discuss in brief about commonly followed practice or industry-known principles, Applicability of this information is subject to change from time-to-time or differ from case-to-case basis. Readers are requested to verify their case facts with a qualified Business Valuation professional.

Getting to the Heart of Business Valuation- I (Selecting the Right Business Evaluator)

2008-11-27T04:17:00.004-05:00

Are you wondering about the value of your business? The current economic meltdown has forced many small businesses to go down under the axe. If you are one of those who are ready to sell business, one of the most important things to remember is not to panic, keep a positive attitude and find the right value of your business. The current crisis has opened up a buyer pool of highly educated unemployed people who would like to check out the options to owing one’s own business. With the current downturn period, the buying terms become more favorable. The only consideration is the availability of easy credit. From a seller’s perspective, specifically the small business owners, they majorly face difficulty on how and where to begin their exit strategy? Next 4 blog series will take you through the entire business valuation process in a step by step manner to guide you to undertake a proper planned approach to put your businesses for sale.

To begin with, ask this simple question “Am I qualified and experienced to evaluate my own business?”

If it is an unchartered territory, start with selecting the right professional evaluator capable to handle the business valuation process professionally. Some of the expert business professionals who offer business valuation services are:

CPAs offer business valuation services. The knowledge gained from handling various accounting, finance and tax work allows an experienced CPA to gain knowledge that is well suited for valuing a business
Financial experts/consultants (Non-CPA) can also lend their expertise, but their background and experience needs to be investigated carefully before hiring them.
Business brokers are an obvious choice to value the businesses for sale as they have many years specialization in buying business and selling business which involves business valuation to negotiate and close the deal at the right price.
Commercial Real Estate Brokers/Agents are good at appraising real estate, but lack skills and experience to properly value intangible assets like goodwill.

Final selection of a suitable professional depends on particular industry type, the professional’s qualifications and experience in handling business valuations. One should also check industry credentials through:

The American Institute of CPAs (AICPA) which grants the ‘Accredited in Business Valuation credential’ that requires being a CPA, passing an exam and business valuation education and experience.
The American Society of Appraisers offers ‘Accredited Member’ and ‘Accredited Senior Appraiser’ designations which requires to pass exams and have business valuation experience and experience
The National Association of Certified Valuation Analysts (NACVA) offers several designations including the ‘Certified Valuation Analyst (CVA)’ that require passing an exam and business valuation education.
The Institute of Business Appraisers offers several designations including the ‘Certified Business Appraiser (CBA)’ that require passing an exam, and varying degrees of business valuation education and experience.

No one type of professional is inherently better than another. Next post we will take up the various popular method of business valuations.

Finding a right buyer to sell your business during the current slowdown

2008-10-20T06:21:00.009-04:00

The recent economic recession has hit hard for the small to mid-sized business owners. It is at such times that the vulnerability and risk of owning and managing one’s own business is exposed.

Entrepreneurs who wake up a suddenly to find themselves in a desperate need to sell business, usually end up leaving lot of value on table which could have been avoided with careful exit strategy. A little bit of preparation can solve complex issues related to selling a business.

Be sure and explore the following potential groups of buyers to avoid being pushed against the wall with no options left:

Family Members:

Family members are the obvious traditional category if you have an entrepreneur lineage in your family. You also have the satisfaction of knowing that the business is still within the family.

But tread carefully. Due diligence must be practiced in answering issues like does the family member have sufficient cash to purchase the business? Can you give up complete control to another family member? Is it going to create rifts with other members? Generally an outside buyer can eliminate such sticky problems usually associated with family members as buyers.

The key to deciding on a family member as a buyer is threefold: ability, family agreement, and financial worthiness.

Business Competitors:

The main concern here is lack of trust and providing the competitor an undue advantage if they smell some trouble or a desperate need. Professional business brokers can help with such delicate situation to negotiate a confidential and worthwhile deal. The catch is of course finding the right competitor while maintaining confidentiality and discretion throughout the selling process.

The Foreign Buyer:

Economic downturn provides a window of opportunity to many foreign players who are looking for a way to be part of the great American Dream. They are ready to work hard and become part of the millionaire tribe. However, their business acumen does not necessarily coincide with that of the seller (as would be the case with any inexperienced owner). Again, only an expert business broker knows best how to approach these potential problems.

Synergistic Buyers:

Such buyers are looking for a synergistic growth for their business that would result in lower costs, new customers, and better supply source and especially in a downturn economy they are looking at way to strengthen and gain a competitive edge to survive and grow. In order to attract such buyers, your business portfolio needs to highlight features showing how buying your business could benefit them. An experienced business broker will prepare the right business portfolio to attract such buyers.

Financial Buyers:

This category of buyer comes with perhaps the longest list of criteria--and demands. These business buyers demand for maximum leverage, but if you prefer to continue to work with the company in an executive and managerial position, they are the right buyers. Their concern is mainly on the bottom line. Usually they offer the lowest purchase price compared to other buyers. A business advisor with strong negotiation skills can ensure you get the fair market price.

Individual Buyer:

The recent recession has forced many qualified top level executives out of jobs. So there will be many potential buyers in this segment looking for small business to buy to gain independence and control their destiny. The difficulty lies in finding one who is ready to make a plunge. Finding an executive who might be interested in buying a business may need some professional help from business brokers.

It is advisable to visit or speak to professional business advisors who have years of experience and would devise an exit strategy that will save time, money, energy and resources along with offering you comfort to deal with the grueling experience of putting you business on sale.

Feeling the entrepreneurial itch? Become a franchise owner

2008-09-18T09:05:00.003-04:00

Applying for franchisee rights or buying an existing franchisee outlet can be the safest way to scratch the entrepreneurial itch as proven processes of decision making and business execution often mean a great difference between success and failure.

Following steps can help you review your franchise buying interests:

Step 1: Self analysis - Do an honest analysis of your personal strength, weakness and find out what kind of businesses you are passionate about and which areas you would not enjoy. Before planning to buy a franchise you should know and love the business that you plan to be a part of. Find out what kind of skills and abilities you have to help you in your search for the right franchise business.

Step 2: Financial situation analysis - Next step would be to find your net worth. If you have carefully gone over your own financial information, you should know exactly how much you want to invest as well as the highest possible number that you can afford to invest. Keep in mind that you will need start-up costs, franchise fees, back-up funds, and enough to live on without an income for at least one year, most likely two. In case you are not aware of how much it costs to buy a franchise, you can contact few business brokers around you and check franchise listings for sale to know the market conditions.

Step 3: Gather Right Intelligence - Keep your eyes peeled for industry information in your chosen franchise sector. Finding out if there is a continuing market for the franchised product or service is a crucial step in your search for right franchise opportunity. Take a look at the competition in the market you will be in, where the industry is going overall, and the sales potential of the product or service in your market. When you find an opportunity that you like, contact the franchise business representative or hire a business broker to investigate the opportunity and to help you in franchise buying process.

Step 4: Seek Professional Advise - Once you are serious about your franchise search, hire a professional business broker, who specializes in listing various profitable franchise opportunities in your area of interest. They will have attorneys, accountants and financers in their team to give complete support. Speaking to them will give you clearer picture of all that is involved. They will help in setting up meetings with other franchisors so that you have practical viewpoints and experiences from insiders to help you make the right decision.

Step 5: Hunt Resources on Franchising - Start collecting information and resources to help you in your research efforts to check best franchise opportunities. Seminars on franchising are often scheduled through Small Business Development Centers (SBDCs), located at larger universities and colleges. Your business broker is also an important resource for information provided you ask the right questions. Start taking active initiative and doing research in your chosen field in order to come up with all the right questions before you make the plunge. Follow the Boy Scout motto “Be prepared”.

Step 6: Narrow your Search - After carefully laying the groundwork and doing your homework, it would be easier to narrow the search and make it more ‘you specific’. By now you should have a firm grasp of what exactly fits your requirements and goals. Consider following important aspects for any franchise opportunity that attracts your interest: Demand, Competition, Brand recognition, Franchisor training and support, Growth opportunities, earnings and comparisons with other opportunities within the similar industry.

Step 7: Decision Making - The moment of deciding to buy a franchise would be easier if proper due diligence is followed as shown in above steps. If you still find the opportunity not quite right for you, then you need to rework. A professional business broker who has worked with many franchisee aspirants would know how to deal with potential issues and problems and would put their experience to good use to help you out.

'Alert Signs' to watch out before selling your business

2008-09-17T08:15:00.004-04:00

In case you’re all set to sell off your business to pursue other plans, here’s some quick advise on ‘alert signs’ to watch out before assuring yourself that the deal is gonna be through.

WATCH OUT FOR THE FOLLOWING ALERT SIGNS WITHIN THE BUYER:

Buyer lacks courage: The buyer may not have an urgent need to go into business. In many cases the buyer may begin with positive intentions, but then doesn't have the courage to make "the leap of faith" necessary to go through with the sale.
Unrealistic: Some business buyers have very unrealistic expectations and believe that everything out there is for cheap price. They presume that the economic slump is going to force the seller to bow down for a lesser price.
Fears hard work: Many buyers are not willing to put in the hours or do the type of work necessary to operate a business successfully.
Lack support: Buyers can be influenced by others who are opposed to the purchase of a business. Many people don't or can't understand the need to be "your own boss."

Situations that "just happen," can also cause deals to fall apart such as:

Environmental Problem: A buyer's investigation reveals some unmentioned or unknown problem, such as an environmental situation. Unfortunately, these should have been on the table from the beginning of the business selling process.
Lack of substantial proof: The seller may not be able to substantiate, at least to the buyer's satisfaction, the earnings of the business.
Governmental issues: Problems may arise, unknown to both the seller and the buyer, with federal, state, or local governmental agencies.
Third party problems:

Landlords may become difficult about transferring the lease or granting a new one.
Buyers and/or sellers may receive overly-aggressive advice from outside advisors, usually attorneys. Attorneys, in their zeal to represent their clients, forget that the goal is to put the deal together. In some cases, they erect so many roadblocks that the deal can only fall apart.

Most of the problems outlined in this post have a solution. Although there are exceptions, most business sales can have happy endings if potential difficulties are recognized in time and tackled accordingly.

Expert Business Brokers are aware of the various ways such buying and selling deal may fall through. They are experienced in resolving this issues before the business is put for sale or before a buyer is introduced to the business. Professional business brokers can help you buy or sell a business successfully without letting any potential deal-wreckers put a spanner in spokes.

Six alert signs to watch out before buying a business:

2008-09-12T09:01:00.008-04:00

While you may be planning to buy a business, don’t forget to check for these ‘six alert signs’ that could make or break your deal.

WATCH OUT FOR THE FOLLOWING ALERT SIGNS IN THE SELLER:

Lack of commitment: In some instances, the seller doesn't have a valid reason for entering into the sale process. Without a strong reason for selling, he or she has neither the willingness to negotiate nor the flexibility to see the sale to a conclusion.
Just testing waters: Such sellers are not at that "hungry" stage that provides the push toward a successful transaction. These sellers merely want to see if anyone wants to buy their business at the price they would like to receive.
Unrealistic price expectation: Many sellers are unrealistic about the price they want for their business. They may be sincere about wanting to sell, but they are unable to be realistic about their business valuations in the marketplace. The demand for their business may not be there.
Dishonesty: Some sellers fail to be honest about their business or its situation. They may be hiding the true reason for selling business; some might not even disclose that there are more than one owner and not all are in agreement to sell a business.
Last minute changers: A seller may decide to wait until a buyer is found and then check with their outside advisors about the tax and/or legal consequences. At this point, the terms of the deal have to be altered, and the buyer won't agree. Nobody likes changes--especially buyers!
Refusal for Seller Financing: Many sellers don't understand that lot of businesses are seller-financed. Buyers have to be able to make the payments while still making a living from the business. If the seller is hesitant to undertake this risk, how can he expect the buyer to put faith in buying the business? If the seller has a genuine reason to refusing for seller-financing, show him some easy financing options with PowerPay’s Pay Link program.

If you’re trying to do this deal on your own it may not be too smooth a journey. Instead why not leave these headaches for an expert Business broker who can assist you to overcome all probable hiccups to make your deal a success.

Buying Business?? Overcome Important Issues…

2008-09-05T07:47:00.005-04:00

Once you have decided to kick off your dream of owning a business, you would either be looking forward to start right from scratch or search for an existing businesses . Here are some tips to buying an existing business.

It is essential to become aware of the business buying issues that will crop up and develop strategies to overcome it:

Be a “doer” and not just a “looker”. If all you do is keep searching for that perfect match, you will never take that plunge. It is essential that at some point in time you have the guts to make the “leap of faith”. It’s not easy, but must happen if you want to own a business.
Be ready to dig out lot of information. Especially if you are planning to buy a small business set-up, be prepared for record keeping practices that are not up to standards required by you or your business brokers. See to it you don’t lose a ‘gem’ of a business just because you did not make the effort to find out everything you wanted to make an informed decision.
Think about how you will finance the deal. If you want the seller financing then don’t press the seller to lower the full price. You need to decide which is important, lower down payment or lower overall price. Be reasonable during negotiation. Take help of an experienced business advisor.
Make sure you can afford the debt structure - don't obligate yourself to making payments to the seller that will not allow you to build the business and still provide a living for you and your family.
Don’t try to push the seller to the wall. You want to have a good relationship with him or her. They will be teaching you the business and acting as a consultant, at least for a while. Be cordial and establish the right note of relationship with the seller.
It's all right to negotiate on areas that are important to you, but don't negotiate over a detail that really isn't key. Many sales fall apart because either the buyer or the seller becomes stubborn, usually over some minor detail, and refuses to bend.
The responsibility of investigating the business belongs to the buyer. Don't depend on anyone else to do the work for you. You are the one who will be working in the business and must ultimately take responsibility for the decision.

Last but not the least, only the best business brokers, would be able to tell you whether you should buy the business or keep searching. Keep an open mind since there is no such thing as "perfect" business and only a professional business broker can help you recognize your goals with the closest match possible. Buying your own business can be a complicated procedure. If you have the right attitude no one can stop your altitude to success.

SELLING your BUSINESS? Ten Commandments that will avoid wrecking your deal

2008-08-25T04:19:00.006-04:00

Place a reasonable price on your business. Since an inflated figure either turns off or slows down potential buyers, rely on your business broker to help you arrive at the best "win-win" price.

Carry on "business as usual." Don't become so obsessed with the transaction that your attention wavers from day-to-day demands, affecting sales, costs, and profits. Since the selling process could take as long as a year, the buyer needs to keep seeing a healthy business.

Engage experts to insure confidentiality. A breach of confidentiality surrounding the sale of a business can change the course of the transaction. Expert business intermediaries can channel the process and the parties involved to keep the sale within safely silent bounds.

Prepare for the sale well in advance. Be sure your records are complete for at least several years back and do all pertinent legal or accounting "housecleaning"-- as well as a literal sprucing-up of the plant or store.

Anticipate information the business buyer may request. In order to obtain financing, the buyer will need appraisals on all assets as well as information to satisfy environmental regulations (when real estate is concerned).

Leverage through buyer competition. This can be tricky; you are wise to let your business broker, as a third party, create a competitive situation with buyers to position you better in the deal.

Be Flexible in your outlook. Don't be the kind of seller who wants all-cash at the closing, or who won't accept any contingent payments or an asset transaction. Depend on the advice of your intermediaries - their knowledge of business financing and tax implications-- to keep the deal sweet instead of sour.

Negotiate; don't "dominate." You're used to being your own boss, but be prepared to learn that the buyer may be used to having his way, too. With your business broker's help, decide ahead of time when "to hold" and when "to fold."

Keep time from dragging down the deal. To keep the momentum up, work with your intermediary to be sure that potential buyers stay on a time schedule and that offers move in a timely fashion.

Stay focused and involved. Even if you are feeling burnt-out, realize that the buyer may want you to stay within arm's reach for a while. Consult with intermediaries to determine how you can best effect a smooth transition.

7 HOT tips to help you sell your business

2008-08-18T01:54:00.003-04:00

Selling a business is no child’s play and it is essential that all business owners follow these crucial steps to minimize the risks involved and ensure smooth selling process with possibilities of bargaining a better sale price.

Tip # 1:
Resolve current financial or any other business related problems thoroughly and as soon as possible. Especially in case of partnership business, it is essential all partners involved are in agreement of selling and there can be no future hindrances from any partner.

Tip # 2:
Get your financial records in place. See its up to date and accurate with impressive indicators highlighting your business in positive light. Ensure there is no manipulation of accounts and your records are true and fair. Its difficult to hide facts and its better to be open about them right from the beginning.

Tip # 3:
Be open to finance the sale. The quickest way to break a negotiation process during sale is refusing to finance part of the sale. It sends a clear indication that you don’t trust your business to earn enough to pay you back.

Tip # 4:
Scout for a professional business advisor or business broker. The professional ones earn every penny of their commission by helping you handle the technicalities associated with selling a business along with helping you keep your emotions under check. Your burden is almost halved when you hire an experienced business advisor.

Tip # 5:
Understand the different types of buyers to gain insights on what motivates each one of them.

Strategic acquirer: They pay the highest prices, usually in cash. They buy for strategic reasons such as economies of scale and market share.

Sophisticated or Corporate acquirer: With backgrounds in corporate America, these buyers examine a business closely. Size is less important than opportunity. They review several businesses before selecting one.

Financial buyer: These are the most plentiful. They will not pay prices based upon projections. So they will not pay top dollar. These groups expect terms or the ability to finance the buy.

Industry buyer: These can be the best or the worst. The best, when they have a strategic reason to buy. Otherwise, watch out! Most industry buyers look only to selected assets to determine value; they do not pay for goodwill or future prospects.

Tip # 6:
Prepare a good marketing plan to sell your business at the best possible terms. Be prepared with information on:

Customer concentration: A heavy dependency on a single customer decreases the value of the business in proportion to perceived risk. It is better to have a larger and diversified base of customers.

Margin Maintenance: Show how you manage costs and measure profitability.

Credible Projections: Support with evidence your expectation for stable and increasing profits, so the buyer can see the opportunity in the business.

Stability of Tenancy: Secure leases to eliminate relocation worries.

Risk Perception: Anticipate situations that might raise a perception of risk.

An experienced business broker will help in preparing all of the above along with a good marketing plan to ensure that right buyers are attracted to your business.

Tip # 7:
Always maintain secrecy. It is essential not to create panic among your present employees, or give a reason for your customers to dessert you or provide your competitors undue advantage. This is also one of the reasons why business brokers are very essential during a sale of business. They ensure the confidentiality of both the parties involved

Selling a business is a skill that is acquired after repeated experience and gaining in-depth knowledge of various fields. It is more than just putting an advertisement on the internet, in a newspaper or spreading the word around. If you hope to get the right price based on business valuation, you will definitely have to do your homework and seek professional help on time.

How do deals get killed?

2008-08-07T10:14:00.005-04:00

After days of scouting for that perfect business opportunity; there is just the matter of signing the dotted lines. But even before congratulations do the rounds, the deal falls apart. What are the major points that kills a business deal? What keeps a sale of business from closing successfully? One of the major culprit is lack of proper understanding. Other criminals invovled are:

A seller who is not up-front about problems of the business. Every problem has a solution…only if the buyer knows those problems. Remember the problem is definitely going to turn up like a bad penny and spoil that deal. Be open from the beginning.

A buyer who goes back on the price agreed upon. Once the price is negotiated and agreed, its not right to revist the issue again and haggle ceaselessly. This jeopardizes a deal like nothing else.
An impatient buyer and/or seller. Unecessary impatience will wear out a deal. It is essential to hire professional business advisors who know how to juggle the deal making process and successfully close a deal. Most people cannot handle the business selling and buying process as it involves expertise in various areas.
A seller who is not serious about sale. Such sellers just want to test the waters and check for price that their business can fetch. But the seller is actually not ready to sell. A good business broker will only show you business listings from serious sellers.
A buyer who is not serious about buying. Such buyer’s think they are ready to own their business, but later develop a cold feet. This usually happens with displaced executives dreaming of becoming enterpreneurs. Dreams are fine, but it takes commitment, grit and hard work to succeed.
The buyer and seller don’t see eye to eye. In short they were never in agreement. How does this situation arise? Unfortunately, many times the buyers and sellers realise belatedly that they only assumed they were in agreement while in reality they did not see eye to eye on major issues. This leads to communication breakdown and often proves fatal to closing a deal.
Unavoidable circumstances like an act of God/Nature might break a deal. Theirs no way out of this.

A successful deal is dependent on ::..
1. A professional and experienced business advisor
2. Good chemistry between the parties involved
3. Open communication and mutual understanding of the sale agreement
4. Belief from both buyer and seller that they are involved in a good deal

WARNING signs that you are heading for a BUSINESS BURNOUT!

2008-08-01T09:09:00.005-04:00

Business owners lead a stressful life. Be on look out for certain warning signs to start planning on a successful exit strategy. It is very essential to start planning on when to sell your business well in advance to avoid heartaches and losses which can be avoided with a little extra caution.

Business burnout is one of the signs that business owners need to be watch out for. It can happen with a business that’s successful or even one that is failing to grow. The right time to sell is before this syndrome becomes a full-fledged threat choking effective management of business and leaving you completely high and dry. What are these warning signs?

>>You get that isolated feeling: The owner who often feels he has been the ‘chief cook and bottle washer’ for such an extended period of time than even routine tasks of decision making and action taking seems like a mammoth task. They have been shouldering the burden alone far too long and are feeling too isolated. This isolation is making them tense and unhappy most of the time

>>No fun and all work: Of course running a business is a serious business and requires tremendous dedication and hard work. But there is a sense of enjoyment and element of happiness to trying to work for your business. Owners who find themselves dragging their feet to work with a sense of either dread or boredom should consider moving on to a fresh challenge elsewhere. Take remedial actions before the disenchantment pulls the business down.

>>Fuzzy Perspective: Owners who suffer from burnouts are so close to work they lose focus and perspective. They are unable to prioritize their work successfully; problem solving goes no further than short term stop gap arrangements. They are unable to think about the big picture and impact of their decision on long term sales & growth.

>> Just plain tired: Feeling tired all the time? Lost that passion to face the day with full enthusiasm? Well simply put many business owners burn out from the constant demand and pressures placed by operating the business day after day, week after week 365 days a year. Even short breaks don’t rejuvenate and helps regain the passion to jump back to the grind. Don’t get disheartened. Remember that sometimes the cut throat grueling schedule of business work is just not for everyone. Learn to recognize such symptoms and start scouting for expert business advisors to help you draft a proper exit strategy.

Independent business owners should learn to understand when is a good time to cash-out and move on. Don’t let the consequences of burn out catch you unawares to force you to sell your business at unfavorable terms. Instead of waiting for worse case scenarios to happen start a planned move to exit your business when it is healthy. The ability to present the business as a healthy operation with the owner in the position of ‘role model’ of success ensures much better deal during sale of a business. Don’t wait too long.

REMEMBER IT IS BETTER TO “CASH-OUT” THAN TO “BURNOUT”

Planning to start your own business: Do you have what it takes to become an entrepreneur?

2008-07-08T03:46:00.019-04:00

Search within yourself if you are ready to take the plunge with your own venture. You might have been a good manager, but that does not ensure that you would be a good entrepreneur too. Not everyone is meant to run their own business. Following is the list of factors that is generally associated with service professionals turning into businessman:

>> Can’t seem to stick to any job or get fired frequently:

To put plainly they are not necessarily lousy employees, but it’s just that some people just can’t adjust to being ordered about or asked to do things. At times they are smarter than their bosses and won’t believe in moving with the herd or even try to work with the stupid ideas thrust upon them by their superiors. Instead they would prefer to kick the job. These individuals have the skills, brains and the ability; along with strong passion and a never ending crave to strike out on their own.

>> Business runs in genes: Their family lineage speaks of business. They might have chosen to work for someone else only for a brief period to gain experience before they choose to plunge into their dream venture. Such individuals also have the tendency to walk the less trodden ways and think nothing of taking risks when required.

>> Constant restlessness dogging their step: They feel they have gone as far as possible in their career and cannot grow anymore. They feel restlessness inside themselves and are on a lookout for higher challenges that comes their way when they start their own venture. They are ready to utilize the accumulated experience and skills gathered in their career to do something for themselves rather than working for someone else.

>> Necessary expertise and skills to run a business: Although a formal education is not a must to run a business, some basic skills that are must is; the ability to manage people, time, and money. They also need to undertake various business sales and acquisitions development activities, and have the technical knowhow of their product/service. Requisite business acumen is pre-requisite to run a business and a formal education degree might help along with necessary practical experiences.

>> They dream to own their own Limo and have a lavish lifestyle: Most successful entrepreneurs have admitted to seeing their dream cars, house or life much before they worked hard to make it possible. Basically this works as Rocket propellers for them and they are not easily bogged down till they own their dream one day. These are the people who know that a job simply might not let that happen or happen fast enough to suit them and thus they would be more inclined to setting up their own business.

>> They have a well placed family support system in place: To become an entrepreneur requires great deal of grit, determination, loads of hard working and sacrifices during the initial years of setting up the business. It is easier for people to strike out when they have an alternative source of regular income in the family, through a spouse or guardian or well placed financial nest egg for at least the first 2-3 years of starting their business. It is very tough to achieve success alone, without the proper family and financial support systems in place. The starting years are lean and tough. Most of the income generated needs to be ploughed right back into business, without much left over for personal support and comfort.

>> Good networking system and right help: No business can survive without a good networking system and expert help in place. Nobody can be an expert in all areas of business. One needs the right contacts in place, along with expert help in the form of good employees or consultants to help them overcome the various hiccups faced during running a business.

>>Self motivation, energy and determination to succeed: Last but not the least, an entrepreneur must have large amount of self motivation to bear the ups, downs and the lulls in business. They never shy away from hard work and have a positive outlook towards future along with high energy levels, time management skills and sheer determination to succeed.

The above points might work for self-assessment before one makes up a decision to plunge into business.

Why is a good Business Broker important?

2008-06-27T03:37:00.010-04:00

Selling your business is serious life altering decision, requiring careful thought and strategic planning. The question that vexes small business owners is: Should I hire the services of business brokers?

Honestly folks the choice is obvious if you carefully analyze some of these hard hitting questions:

· Are you ready with your buyer list?
· Are you ready with your marketing plan?
· Are you ready with procedures to ensure complete secrecy is maintained?
· Are you willing to do all the leg work and deploy sufficient time to sell your business?
· Are you qualified to adhere due diligence procedures?
· Are you an expert in business for sale?
· Are you aware of legal and accounting issues relevant to deal making processes?
· Are you qualified to evaluate the right price of your business?
· Are you sure you can do the best possible job of selling than anyone else?

If you are positive about all the above points, kudos to you! You are ready to handle your own business for sale. However if, most of the answers are negative or unsure, you definitely need the services of a business broker.

A business broker will help to match you with the right buyer, so that you get the best possible deal and your business is transferred to the right hands. A business broker or intermediary must possess multiple skills to achieve this mammoth task. The right business broker will possess an array of skills like:

· Powerful and effective communication techniques and negotiations skills
· Hands on experience in selling and sharp business acumen
· Strong leadership qualities
· Knowledge and expertise in preparing marketing plan and salesmanship
· Quick grasp of your business, accounting procedures, laws and tax policies
· Industry expertise to provide right guidance and tips on whether to sell business now or later

A competent business broker will provide full range of services to the client from business evaluation, to identifying obstacles, preparing effective marketing plan, drawing up the right buyer list, determining the correct selling price, negotiating best possible deal, giving tips to enhance the value of business, researching when is the right time to sell or even question your decision to sell and provide you with better alternatives like going for expansion or strategic buying.

The right business broker will not want a quick sale just to lay hands on commission. They should be a partner in the entire process to understand your ultimate goal and provide smooth transition to achieve it.

Check list that will help you select the right business broker for you:

Credentials and experience in this field
References of previous clients
Quality and control systems in place to ensure things are done promptly, in right sequence and complete secrecy is maintained to ensure successful sale.
Check whether they are part of recognized associations like IBBA, ABBA, APMAA, AMAA and their membership status in these organizations.
The qualifications and expertise of the support team in place. No broker is an expert in all the field e.g. accounting, tax, law, marketing etc
Fees structure: Understand the break up clearly for upfront fees, retainers, commissions etc. Understand what you are being charged for and whether you are getting those services. Don’t be taken in by false promises or any platitudes.

In short, practice due diligence and check the background, work history, credentials of your broker just as a buyer will practice due diligence before buying a business.

Selling your company is a complex transaction and should never be done under pressure or compulsion but only after clarifying all doubts and uncertainties. The right broker will help clarify all your doubts to your satisfaction and earn your trust to achieve successful conclusion. Even if you plan to sell maybe 5 years down the lane, do your homework now and be prepared.