Selling a business is often a first time event filled with unidentified obstacles for many business owners.  Selling a company usually involves both economical and psychological factors.  Many owners invest lots of hard work branding, nurturing and growing their business.  Once they have decided to sell, business owners will face many concerns.  An experienced business broker will help the owner address these items with proper planning.

A major concern of a business owner is obtaining maximum price when selling his or her business.  The asking price is what the owner desires, selling price is what the owner gets and fair market value is the highest price that a buyer will pay and lowest price an owner will accept.  A professional business broker will help the parties reach that fair market value.

Today’s potential buyers are more intelligent and demanding than those buyers of yesteryear.  Many buyers are in search of the fail proof business – the majority of which are unwilling to make the leap-of-faith necessary to pull the trigger and purchase a company.  Buyers of today are far more concerned about the financials than previously.  They are more educated and expect to buy a company and continue to operate as is with minor tweaks along the way.

A business owner should realize that often the buyer looks for growth opportunity in the business but is only willing to pay a price based on historical operating results.  The buyer’s rationale is that only he or she should benefit from their future efforts, not the seller.  The price to be paid in a buyer’s mind is based on the business owner’s past results.

Still, there are things that an owner should do before deciding on selling a business.  All hidden issues should be resolved beforehand as they will often kill a deal more times than not.  All potential legal, financial and operational items need identified and handled up front.  The financial statements should provide a proper reflection of the true earnings of the company.  An experienced business broker is invaluable in this process.  This professional can also assist with identifying the team members necessary to handle potential problems before they become a problem.

Finally, the Seller should be realistic with his or her asking price.  Starting too high will often simply scare buyers away and often sends an unintended message to the buyer that the owner is simply unrealistic and not serious about selling his or her business.  Sellers think that they can always come down on price.  The fallacy with this thinking is that the buyer merely moves on to other realistically priced companies.  The professional business broker can advise owners on what is reasonable or not.

The below provides a summary of top selling businesses according to a recent survey.  This is in response to buyers asking us “What’s Selling”?  The national survey revealed the following percentage breakdown of business sales by business types.

Service type businesses include dry cleaners, quick print, video stores, etc.   Other businesses include coin laundries, delivery, product, and vending routes, and any that don’t fit into the other categories listed.

What does this mean to you as a business owner?  It indicates that service type businesses seem to be creating the most activity from business buyers, followed by retail and the food and drink sector.  The service sector has also been the leader in businesses sold by business brokers for the previous two years.  This coincides with the growth nationally in the service sector coupled with the broad range of businesses included in it.

The food and drink sector, which includes restaurants, fast-food, taverns, etc., has always been a popular one for buyers.  One reason is that most people frequent these types of businesses on a regular basis and therefore are familiar with them.  Plus, there has always been a certain “celebrity” status connected with this sector.

However, statistics aside, today’s buyer has more knowledge, experience and education than ever before and is willing to consider almost any type of profitable business.

We have a strong backlog of buyers seeking all types of companies.  Contact TM Business Brokers Pittsburgh to learn whether or not you have a sellable business.  Do not make the mistake of relying on an adviser who does not sell companies for a living.  You may be delaying the sale of your business for the wrong reasons.

Now may be your time.  Contact the experienced professionals at TM Business Brokers Pittsburgh to confidentially discuss “your” situation today!

Pre-Selling Considerations – Raleigh Business Brokers

TMBB, your Raleigh business brokers, sometimes asks a business owner, “Do you think you will ever sell your business?”  The answers vary widely from:  “Only when I can get my price” to “Never” to a realistic “I don’t really know” with everything else in between.  “When will you sell your business?” is often asked, but very seldom answered.  Certainly, misfortune can force the decision, but no one can predict this event.  Most don’t believe or accept the old expression “It is always a good idea to sell your horse before it dies.”

There is an also an old adage:  “You should start planning on exiting your business the day you buy or start one.”  You can’t predict misfortune, but you can plan on it.  Unfortunately, most sellers wait until they wake up one morning, and just drive around the block several times working up the courage to begin the day working in their business.  This is a common sign of “burn-out” and is an-going problem with small business owners.  Or, they face family pressure to start “taking it easy,” or to move closer to the grandchildren.  Now what?

There are really only four ways to leave your business.  Obviously, the easiest is to put the key in the door and walk away.  It’s also the worst way!  The years of hard work building a business has a value.  Another way is to transfer ownership to one’s children or child.  Assuming one of them is interested and capable, it can mean a successful transfer and a possible income stream.  A third way is to sell it to an employee.  The employee may know the business, but may lack the interest or skill for ownership or the funds necessary to pay for it.  The fourth way, and the one taken by the majority of small business owners, is to sell it and move on.  Every business owner wants as much money as possible when selling, so now may be a good time to begin a pre-exit or pre-sale strategy.  Here are a few things to consider.

Buyers want cash flow.

Buyers are usually buying a business with a cash flow that will allow them to make a living and pay off the business, assuming it is financed – and most are.  Buyers will look at excess compensation to employees and family members.  They will also consider such non-cash items as depreciation and amortization.  Interest expenses along with owner perks such as auto expense, life insurance, etc., will also be considered.  A professional business broker is a good source of advice in these matters.

Appearances do count.

Prior to going to market, make sure the business is “spiffed up”.  Do all of the signs light up properly at night?  Replace carpet if worn; paint the place and replace that old worn-out piece of equipment that doesn’t work anyway.  If something is not included in the sale – like the picture of Grandfather Charlie who founded the business – remove it.  An attractive business will sell for much more than a tired and worn-out looking place.

Everything has value.

Such items as customer lists, secret recipes, customized software, good employees and other off-balance sheet items have significant value.  They may not be included in a valuation, but when it comes time to sell, they can add real value to a buyer.

Eliminate the Surprises.

No one likes surprises, most of all, prospective buyers.  Review every facet of your business and remedy any problems, whether legal, financial, governmental, etc., prior to placing your business up for sale.

Your professional business broker can assist in all facets of preparation.  They know what buyers are looking for and they also are familiar with current market conditions.

We have a strong backlog of buyers seeking all types of companies.  Contact TM Business Brokers Raleigh to learn whether or not you have a sellable business.  Do not make the mistake of relying on an adviser who does not sell companies for a living.  You may be delaying the sale of your business for the wrong reasons.

Now may be your time.  Contact the experienced professionals at TM Business Brokers Raleigh to confidentially discuss “your” situation today!

Raleigh Business Brokers – Work on Your Books

Business owners often ask us what things they should be doing to get ready for the sale of a business.  While there are many items an owner can do with proper planning, one of the major items that we at TM Business Brokers suggest is to get your financial affairs in order and “work on your books”.

Clean up the balance sheet and keep non-business related expenses off the profit and loss.  Increase your bottom line as much as possible and in turn increase the amount of bank financing that a potential buyer will qualify for.  In turn, the owner will then need a lower level of seller financing to successfully sell a business.

Don’t over borrow.  Keep an continuous eye on your books.  The following article addresses one business owners struggles by not keeping an eye on his books.

We have a strong backlog of buyers seeking all types of companies.  Contact TM Business Brokers –  your Raleigh Business Brokers to learn whether or not you have a sellable business.  Do not make the mistake of relying on an adviser who does not sell companies for a living.  You may be delaying the sale of your business for the wrong reasons.

Now may be your time.  Contact the experienced professionals at TM Business Brokers to confidentially discuss “your” situation today!

Sell Your Business – Pittsburgh | Raleigh Business Brokers

Selling your business or buying a business?  Either way, both culminate with a closing which is the formal transfer of a business.   This represents the successful culmination of many months of hard work, extensive negotiations, lots of give and take, and ultimately a satisfactory meeting of the minds.  The document  which governs the closing is the Purchase and Sale Agreement.  TM Business Brokers, your Pittsburgh | Raleigh Business Brokers, recommends that the Purchase and Sale Agreement  contain the following items:

• A description of the transaction – Is it a stock or asset sale?

• Terms of the agreement – This covers the price and terms and how it is to be paid.  It should also include the status of any management that will remain with the business.

• Representations and Warranties – These are usually negotiated after the Letter of Intent is agreed upon.  Both buyer and seller want protection from any misrepresentations.  The warranties provide assurances that everything is as represented.

•  Conditions and Covenants – These include non-competes and agreements to do or not to do certain things.

There are four key steps that must be undertaken before the sale of a business can close:

1.  The seller must show satisfactory evidence that he or she has the legal right to act on behalf of the selling company and the legal authority to sell the business.

2.  The buyer’s representatives must have completed the due diligence process, and claims and representations made by the seller must have been substantiated.

3.  The necessary financing must have been secured, and the proper paperwork and appropriate liens must be in place so funds can be released.

4.  All representations and warranties must be in place, with remedies made available to the buyer in case of seller’s breech.

There are two major elements of the closing that take place simultaneously:

• Corporate Closing: The actual transfer of the corporate stock or assets based on the provisions of the Purchase and Sale Agreement.  Stockholder approvals are in, litigation and environmental issues satisfied, representations and warranties signed, leases transferred, employee and board member resignations, etc. completed, and necessary covenants and conditions performed.  In other words, all of the paperwork outlined in the Purchase and Sale Agreement has been completed.

• Financial Closing: The paperwork and legal documentation necessary to provide funding has been executed.  Once all of the conditions of funding have been met, titles and assets are transferred to the purchaser, and the funds delivered to the seller.

It is best if a pre-closing is held a week or so prior to the actual closing.  Documents can be reviewed and agreed upon, loose ends tied up, and any open matters closed.  By doing a pre-closing, the actual closing becomes a mere formality, rather than requiring more negotiation and discussion.

The closing is not a time to cut costs – or corners.  Since mistakes can be very expensive, both sides require expert advice.  Hopefully, both sides are in complete agreement and any disagreements were resolved at the pre-closing meeting.  A closing should be a time for celebration!

We have a strong backlog of buyers seeking all types of companies.  Contact TM Business Brokers –  your Pittsburgh | Raleigh Business Brokers to learn whether or not you have a sellable business.  Do not make the mistake of relying on an adviser who does not sell companies for a living.  You may be delaying the sale of your business for the wrong reasons.

Now may be your time.  Contact the experienced professionals at TM Business Brokers to confidentially discuss “your” situation today!

Pittsburgh Business Brokers – You Want How Much for Your Business?

Buyers of small to medium-sized companies have many questions for the business owner.  One of the first questions relates to asking price.  When the owner responds, the above question is often the prospective buyer’s first response when given the price of a seller’s business.

This is especially true today when many excellent and profitable businesses have few hard or physical assets.  For years, buyers, and even business appraisers, have called the difference between the actual physical assets and the asking price as “blue sky.”  Goodwill has often been a prime force behind the blue sky concept, and it is one of the reasons a potential buyer might feel that the seller is asking an “arm and a leg” for the business.  Goodwill has been called many things – very few of them good.

However, today’s goodwill is more than just the hard work and effort a business owner has put into building the business.  The Web site name alone may be worth a lot of money.  Think “Google,” which by now may have achieved the same name recognition as Kleenex.  If another search engine company could use that name, the business could be worth millions – even billions.  The technology behind the name has a lot of value, but it’s important to remember that the name recognition or brand name, which is known all over the world, is also where the big bucks lie.

How does this relate to goodwill?  The goodwill of a business can include patents, copyrights, its Web site and/or domain name, licenses, trademarks, proprietary software, secret recipes (What is the value of the secret recipe for Coke?), royalties – the list goes on and on.  Would a McDonald’s business, assuming the same sales and profit, have the same value if the name and franchise were not included.

Buyers are beginning to realize that much of the value of a business in today’s world is not to be found in the hard assets such as the fixtures and equipment, but in the intangibles that create the income.  Take the McDonald’s just mentioned, it may have beautiful stainless steel equipment, but the equipment is only worth the income it can produce; and to take it a step further, there are warehouses in every major city in the country full of “for sale” stainless steel equipment.  The real value is the name and what it represents to the dining public.

For those who are considering selling their business in the near future, this new emphasis on goodwill means that some business procedures need to be changed.  Operations manuals should be copyrighted, Web sites and domain names should be protected,  product and specific service names should be trademarked, inventions patented.  There needs to be emphasis placed on intangibles that have to be earned, such as name recognition, brand names, employees, business relationships with suppliers and customers, long-term advertising, reputation, etc.  Don’t let anyone tell you that goodwill does not have value – it is most likely the most valuable asset of your business.

Goodwill should be as protected as the law will allow.  A visit to an Intellectual Property attorney may well be the best investment a seller can make.

For those who are considering buying a business, make no mistake about it, in many cases, what you are really buying is the goodwill of the business.  If a buyer is still hung up on buying the stainless steel equipment, we have a warehouse full of it for sale!

We have a strong backlog of buyers seeking all types of companies.  Contact your Pittsburgh Business Brokers – TM Business Brokers to learn whether or not you have a sellable business.  Do not make the mistake of relying on an adviser who does not sell companies for a living.  You may be delaying the sale of your business for the wrong reasons.

Now may be your time.  Contact the experienced professionals at TM Business Brokers to confidentially discuss “your” situation today!

Pittsburgh | Raleigh Business Brokers – Preserving the American Dream…

The tenets of this dream – owning a home, getting an education, having a job or owning a small business, and achieving financial self-sufficiency – are being crushed by regulations that are killing small businesses and the community-based financial institutions that support them.  The American Dream depends on jobs and opportunities and it’s well known that small businesses create the majority of new jobs, while community-based institutions disproportionately finance small business growth.

The importance of Main Street financial institutions, which drive the national economy one community at a time, cannot be underestimated.  By financing the small businesses that create 65% of new jobs, they drive consumer spending, which represents about 70% of the U.S. economy.  Today, however, “Big Bank” policies are limiting the ways that Main Street banks and credit unions can generate income and lend to small businesses, while subjecting them to onerous compliance burdens.  These and other policies are also harming small businesses by limiting their access to capital and burying them under regulations that consume valuable resources and increase operational costs.

Read more:

https://smallbusiness.foxbusiness.com/entrepreneurs/2012/09/18/preserving-american-dream-through-small-businesses/#ixzz28tbhWL67

We have a strong backlog of buyers seeking all types of companies.  Contact your Pittsburgh | Raleigh Business Brokers – TM Business Brokers to learn whether or not you have a sellable business.  Do not make the mistake of relying on an adviser who does not sell companies for a living.  You may be delaying the sale of your business for the wrong reasons.

Now may be your time.  Contact the experienced professionals at TM Business Brokers to confidentially discuss “your” situation today!

Pittsburgh | Raleigh Business Brokers – Cashing Out?

Business owners have more options than they realize when it comes time to sell or “cash out”.  The following article summarizes several.  Taking the wrong approach could have serious financial consequences for both the entrepreneur and the company.  So it pays to know the pros and cons of the several ways to cash out and to think carefully about which is the right fit for your business and you.

An outright sale is probably the simplest way to exit a business.  This approach makes sense when an owner’s family members have no interest in taking it over or when the owner can’t figure out how to take the company to the next level or meet challenges that may have arisen.

There are two ways to cash out:  An owner can sell the company’s assets outright, or he can sell his stock in the company (or units if it is a limited-liability company).  Stock sales tend to benefit the seller, while asset sales are more beneficial to the buyer.

Asset buyers are getting the company’s physical equipment, facilities and customers, as well as intangibles such as trademarks and goodwill, and as a result are generally protected against prior claims against the business.  For example, the previous owners would most likely be responsible if an environmental claim were made against their former property or if an employee hired on their watch filed some sort of lawsuit.

We have a strong backlog of buyers seeking all types of companies.  Contact your Pittsburgh | Raleigh Business Brokers – TM Business Brokers to learn whether or not you have a sellable business.  Do not make the mistake of relying on an adviser who does not sell companies for a living.  You may be delaying the sale of your business for the wrong reasons.

Now may be your time.  Contact the experienced professionals at TM Business Brokers to confidentially discuss “your” situation today!

Pittsburgh | Raleigh Business Brokers – TM Business Brokers, via Tony McDaniel,  recently requested LinkedIn recommendations for health insurance for the raleigh small business owner.

Following are the recommendations:

William Blackmon • Now this is a great questions. I am all ears as I wish to learn more about what services are out there for NC based small business.

Nancy Williams • There is no blanket answer on what is the best health insurance for the small business owner – each situation is going to be different. Depending on how many employees, what health conditions may already exist, how many dependants, etc will go into the equation when we make recommendations on a carrier and/or a plan. I always meet with my clients individually to go over what their budget and needs are and we find the right carrier and plan based upon that information.

There’s a lot of small business owners out there that are paying more for their health insurance than they need to. Always a good idea to talk to a health insurance specialist and have an insurance review. You don’t know what you don’t know.

Many of the plans will include vision and dental is generally sold separately. I have found a carrier that has an excellent plan and is about half the price of BCBS’s dental.

Naturally, I’d be happy to assist! Another thing the small business owner should look at is disability insurance. Its important to protect the income!

 

Shelli Dallacqua • I highly recommend Forrester and Associates in Durham. They specialize in providing health benefits as well as vision and dental for small businesses. They’ll give you a free quote. You can find more information on their website athttps://forresterinsurance.com/. I use Rachel Lyons as my consultant and you can contact her at RLyons@forresterinsurance.com

Dan Daniel, CLU, MBA • Strategic Employee Benefit Services (SEBS) is a Member of the Northwestern Mutual Financial Network. We provide value added services in addition to brokering health plans from Blue Cross, United Healthcare and others. I’d be happy to assist you with your needs. I can be reached at (919) 755-3242.

Mike Komives • I recommend you contact Phil Wolf of the Insurance Center of Durham. Phil is very knowledgeable about health insurance issues, helpful and realistic. I have personally watch Phil as a regular guest speaker at numerous workshops.

Gayle Hart • I was recently laid off and went into business for myself. I have no other employees, so this may not apply to your situation, but I registered with the Freelancers Union (https://www.freelancersunion.org/), at no cost to me, and am planning to enroll in one of the Golden Rule plans United Health offers to union members–it is about half the cost of COBRA. I haven’t looked into it yet, but the Freelancers Union also offers some help with 401K and FSA.

Tamra Demello • Our company specializes in insurance for the self employed and small business owner. You have a lot of available options. I would welcome the opportunity to analyze your individual situation and custom design a solution that would meet your needs in the most cost effective way. I welcome the opportunity to help you in any way I can.

Jamie Glass • I also highly recommend Forrester Insurance in Durham. You will receive personalized, professional assistance.

Lauren Campbell • Sit down with Brian Trebenski with ABEO Insurance Agency. He has helped several of small business owners we deal with and we have heard nothing but rave reviews! He will help evaluate your needs and really goes the extra mile for his clients. Please let me know if you need more contact information. He can be found at:https://www.abeoins.com/

Tony McDaniel • I appreciate the recommendations. Thank you for taking the time to provide them!

 

Landon Watts • David Charland – Pierce Group Benefits dcharland@piercegroupbenefits.com (888) 662-7500 www.piercegroupbenefits.com

Building a Sellable Service Business – Pittsburgh | Raleigh Brokers

To build a sellable service business – you need to set up your company so that it is no longer reliant on you according to Pittsburgh | Raleigh Brokers – TM Business Brokers.

This can be easier said than done, especially when, like a PR consultant or plumber, what you are selling is your expertise.

To scale up a knowledge-based service business, you first have to figure out how to impart your knowledge to your employees, so that they can deliver the goods.  However it can be difficult to condense years of school and on-the-job learning into a few weeks of employee training.  The more specialized your knowledge, the harder it is to hand off work to juniors.

The key to scaling up a service business can often be found by offering the service that prevents customers from having to call you in the first place.  You have to shift from selling the cure to selling the prevention.

Fixing what is broken is typically a hard task to teach; however, preventing things from breaking in the first place can be easier to train others to do.

For example, it takes years for a dentist to acquire the education and experience to successfully complete a root canal, but it’s relatively easy to train a hygienist to perform a regularly scheduled cleaning.

It’s almost effortless for a real estate manager to hire someone to clean the eaves trough once a month, but repairing the flooded basement caused by the clogged gutters can be quite complex.

For a master car mechanic, overhauling an engine that has seized up takes years of training, but preventing the problem by regularly changing a customer’s oil is something a high school student can be taught to do.

For an IT services company, restoring a customer’s network after a virus has invaded often takes the know-how of the boss, but preventing the virus by installing and monitoring the latest software patches is something a junior can easily be trained to do.

When you’re selling your expertise, it can be tough to hire a team to do the work for you.  As ironic as it sounds, sometimes the key to getting out of doing the work is to offer a preventive service, which not only maintains your business income, but also eliminates the need for someone to call you in the first place.

Building a Sellable Business – TM Business Brokers – Raleigh | Pittsburgh

Do you want to sell your business?  Thinking about selling your business at some point over the next couple of years?  Or, do you know someone that may be interested?

We will be hosting an exclusive webinar about Building a Sellable Business for Business Owners on Tuesday, June 19, 2012 from 11:00AM – 12:00PM EDT.

This session is not a public event and will not be recorded for future reference.

To register:  https://www3.gotomeeting.com/register/849773038

Thank you.

PS……

Take the “Sellability Score” quiz now and find out:

•       The Sellability Score of your business, including where it ranks on the scale of being easy or hard to sell.

•       Your best options for selling your business depending on your score.

•       The most important (and often overlooked) questions you should ask yourself to determine if your business is ready to sell.

Get started by clicking the link below:

THE SELLABILITY SCORE

What’s Your Sellability Score – Raleigh | Pittsburgh Business Brokers

Ever dream of selling your business for big money and retiring to the good life?   You may not be as far from turning that dream into a reality as you think.  Find out how your business would stack up if you really tried to sell it by taking the free quiz and getting your Sellability Score:

THE SELLABILITY SCORE

Business Brokers in Raleigh Expansion

TM Business Brokers announces its’ latest new office facilities in Raleigh, NC.  The new location expands the company’s geographical service area, and is designed to accommodate our fast-growing business brokerage operations by helping business owners sell a business and buyers purchase a business not only in the Raleigh, Durham and Chapel Hill areas but also in Greensboro, NC.  As business brokers in Raleigh, our primary goal is to help the business owner sell your business for more money confidentially.

Our growth over the past couple of years has been right on plan and we’ve been able to recruit top talent.  This new office will allow us to maintain our steady growth and serve our customers even better.  The new office will serve as our anchor location in North Carolina and support our continued growth expansion plans in the North Carolina market.

TM Business Brokers new Raleigh address is 11028 Fair Chase Court, Suite 2A, Raleigh, NC  27617.  The telephone number is 919-999-2400 and fax number is 919-999-2401.