The Importance of Owner Flexibility

You shouldn’t expect to sell your company overnight.  For every company that sells quickly, there are a hundred that take many months or even years to sell.  Having the correct mindset and understanding of what you must do ahead of time to prepare for the sale of your company will help you avoid a range of headaches and dramatically increase your overall chances of success.

First, and arguably most importantly, you must have the right frame of mind.  Flexibility is a key attribute for any business owner looking to sell his or her business.  There are many variables involved in selling a business, and that means much can go wrong.  An inflexible owner can even irritate prospective buyers and inadvertently sabotage what could have otherwise been a workable deal.

Be Flexible on Price

A key part of being flexible is to be ready and willing to accept a lower price.  There are many reasons why business owners may fail to achieve the price they want for their business.  These factors range from lack of management depth and lack of geographical distribution to an overreliance on a handful of customers or key clients.  Of course, one way to address this problem is to work with a business broker or M&A advisor in advance, so that such price issues are minimized or eliminated altogether.

Be Prepared to Compromise

In the process of selling your business, you may want to achieve confidentiality and sell your business quickly and for the price you want.  However, the fact is that most sellers find that it is possible to have confidentiality, speed, and the price you want, but not all three.  Ultimately, you’ll have to pick two of the three variables that are most important to you.

Be Patient

A third way in which business owner flexibility can boost the chances of success is to embrace the virtue of patience.  By accepting the fact that businesses can “sit on the shelf” for a considerable period of time, you are shifting your expectations.  This realization can help reduce your stress level.  The fact is that stressed out owners are far more likely to make mistakes.

Sometimes Losing is Really Winning

A fourth way in which business owners should be flexible is realizing that you and your lawyer will not win every single fight.  There will be many points of contention, and a smart dealmaker realizes that it is often better to have a good deal than a perfect deal.  You may have to make sacrifices in order to sell your company.  Simply stated, you shouldn’t expect the other side to lose every point.

At the end of the day, a savvy business owner is one that never loses sight of the final goal.  Your goal is to sell your business.  Seeing the situation from the buyer’s perspective will help you make better decisions on how you present your business and interact with prospective buyers.  Maintaining a flexible attitude with prospective buyers helps to position you as a reasonable person who wants to make a deal.  Goodwill can go a long way when obstacles do arise.

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The Main Street Lending Program

There is no doubt that the COVID-19 situation seems to change with each and every day.  The disruption and chaos that the pandemic has injected into both daily life and business is obvious.  Just as it is often difficult to keep track of the ebbs and flows of the pandemic, the same can be stated for keeping up to speed on the government’s response and what options exist to assist companies of all sizes. 

 In this article, we’ll turn our attention to an overlooked area of the government’s pandemic response and how businesses can use a whole new lending platform to navigate the choppy waters. 

As the pandemic continues, you will want to be aware of the main street lending program, which is a whole new lending platform.  It was designed for businesses that were financially sound prior to the pandemic.  Authorized under the CARE Act, the main street lending program is quite attractive for an array of reasons.  Let’s take a closer look at what makes this program almost too good to be true.

This lender delivered program is a commercial loan.  Unlike the PPP, there is no forgivable component.  However, the main street lending program does have one remarkable feature that will certainly grab the attention of all kinds of businesses.  It can be used to refinance existing debt at a rate of around 3%.  With that stated, it is also important to note that businesses cannot refinance existing debt with the current lender.  Instead, a new lender must be found.  Generally, loans are a minimum of a quarter million dollars and have a five-year term.  In another piece of good news, there is a two-year payment deferment period.

The main street lending program can be used in a variety of ways.  In short, the program is not simply for refinancing existing debt.  Additionally, there is no penalty for prepayment.  The way the program works is that lenders make the loans and then sell 95% of the loan value to the Fed.  This of course means that the lender is only required to retain 5% of the loan on their balance sheet.  The end result is that lenders can dramatically expand the amount of loans they can make.

Whether it is the PPP or a program like the main street lending program, there are solid options available to help you.  Businesses looking to restructure debt or put an infusion of cash to good use may find that the main street lending program offers a very flexible loan with great interest rates.

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Why Does Your Business Need Google Reviews?

In today’s business climate, reviews are the differentiator.  Years ago, people commonly asked for references when they were vetting a product or service.  But these days when people are searching for a local business to work with, they are likely to conduct research on their own and read online reviews. 

Google reviews can give businesses a big credibility boost without having to spend a dime.  Let’s take a look at some of the key benefits.

Increased Credibility & Trust

According to statistics, approximately 91% of consumers read reviews to determine credibility of a local business.  In fact, 84% of consumers say the positive reviews have helped them gain trust.  Without the reviews, that level of trust would not have been established. 

Needless to say, people trust Google.  The fact that these reviews are on a 3rd party website increases transparency.  These reviews have much higher value than testimonials posted on the actual business website.

Improved Business Conversions

Once a potential customer gains trust in your company through reading Google reviews, it is more likely the conversation will get converted to an actual business transaction. 

Customer Feedback Loop

When your customers write reviews about your business and post them on Google, these reviews often clearly mention details about your product or service.  Through this means, future customers become educated.  These reviews can also serve as a feedback loop for you if things need improvement.

Increases Online Reputation & Visibility

The power of online marketing methods you might be using to promote your business will be amplified, as users will become more attracted to your business due to 5-star reviews.  This factor increases online traffic to your website and an increase in leads and business.

Another fact to be conscious of is that your clients will review your products or services whether you want them to or not.  If you fail to set up Google reviews, you’re missing out on the opportunity to gain a level of control and visibility.

How to Set Up Google Reviews

  • Create a Google My Business account.  – Visit https://business.google.com/ to sign in or create a Google account for a business.  Complete the step by step process by filing required information like email, phone number, business details, etc.
  • Ask clients to review your services. – Start sharing your Google My Business URL with clients and ask them to post a review about your services.  When asking for reviews, you can mention to clients that their review will help everybody else make an informed decision when they are looking for help.  It is important to ask about the review within a few days of closing your transaction.  If more time goes by, the client may be less motivated to post a review for you.
  • Remind clients. – Everybody is busy.  Therefore, there is a chance that your client might forget to write a review.  In this case, we recommend reminding them to do so.  You can also politely inquire if they need any help posting the review that you discussed.

Through the above-mentioned process, you can begin generating reviews for your business.  Of course, it goes without saying that you can only guarantee good reviews when you are providing excellent customer service along with a top-notch product or service.

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Getting Back to Business After the COVID-19 Pandemic

Historians have long known the historical relevance and impact of epidemics and pandemics.  Despite our various technological advances and the complexity of our society, disease can instantly change the course of history.  Not having a robust global system for dealing with disease and pandemics comes with a hefty price tag.  In the case of the COVID-19 economic crisis, the price tag will no doubt be in the trillions. 

You can’t control what has happened, but you can focus on what to do when the pandemic is over and life begins to slowly return to normal.  In his recent article, “How to Hit the Ground Running After the Pandemic,” author Geoffrey James explores what businesses need to do to jumpstart their operations once the pandemic is in the history books.

James wants his readers to understand that the pandemic will end and that business owners need to be ready to charge back in when the pandemic is over and the economy rebounds.  As James points out, if history is any indicator, the economy will eventually rebound. 

Almost everything about this economic downturn is unique.  Take, for example, the fact that the U.S. has just seen its largest-ever economic expansion.  The gears and wheels of the economy were spinning along quite quickly before the pandemic hit.  This could help restart the economy faster than in past severe economic downturns.  In short, many experts feel that this particular economic downturn could be short, but of course, this is speculation.  There is no way to know for sure until COVID-19 is in the rearview mirror.

James correctly asserts that businesses need to put together a plan for how they will get up and running as soon as the pandemic is over.  His recommendation is to divide your plan and thinking into four distinct categories: Facilities, Personnel, Manufacturing, and Marketing.

Each of these categories has three key questions that business owners should be asking themselves so that their businesses are ready to hit the ground running when COVID-19 is over.  Below are a few of the key questions James recommends asking.

  1. How can we create the most sanitary and disease-free workplace possible?
  2. Which employees will continue to work from home?
  3. When there’s a spike in demand, how will we ramp-up?
  4. What will be our “We’re Back!” marketing message?

The pandemic caught everyone except the experts off guard.  Moving forward, business leaders, think tanks, and politicians alike need to work to develop and implement robust plans to minimize the damage caused by pandemics.  Humanity, and business, has been “lucky” several times in recent years, as we dodged bullets ranging from Ebola to SARS. 

As James points out in his article, “Failing to plan is planning to fail.”  Businesses need to plan for the recovery and they need to plan for another pandemic because another one is quite possible especially if better planning and decision making are not firmly entrenched in place.

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COVID-19 Advice for Hospitality Businesses

Clearly, some industries are taking a bigger hit from COVID-19 than others.  Any industry that requires a great deal of interaction with the public, or where people gather in large groups, are obviously having very tough times.  Movie theaters and restaurants, for example, have essentially gone dark.  Some restaurants are easing the bloodletting a bit by providing delivery, but in the vast majority of cases, revenue pales in comparison to what it was prior to the pandemic. 

While there is no doubt that the hospitality industry is suffering right now, business owners should understand that there are concrete steps they can take now to improve their odds of surviving the pandemic.  In this article, we’ll explore a few of these key ideas.

One of the areas every decision maker and business owner in the hospitality industry should be thinking about right now is staff.  During a recent industry roundtable discussion, John Howe, chairman of the International Association of Business Intermediaries, pointed out that staffing problems will continue long after the pandemic has paused or is over.  He believes that hospitality businesses will have a tough time getting the staff they need, especially in the short run. 

His key piece of advice is to work to have a line on people for key positions.  This will allow you to at least get back up and running with basic operations.  While it may be a while before hospitality businesses are at “full steam,” it is critical that they are able to open up in some fashion, as this will translate into much needed revenue.  Hospitality businesses looking to survive the pandemic should focus on making certain that key positions have been filled.  In this way, the post-pandemic relaunch can be as smooth as possible.

Founder and President of Cornerstone Business Services, Scott Bushkie, explained that there are a lot of hospitality industry people out of work right now, and this represents a real opportunity.  Now, is the perfect time to potentially upgrade staff.  There are plenty of experienced and proven hospitality people looking for positions.  The new people you bring may come with extra benefits such as bringing their customers, suppliers, and other relationships with them.  For those in the hospitality industry who may have always wanted to upgrade their team, now is perhaps the best time in history to do so.

Employees are a foundational element of your business.  Improving your staff means you’ve improved your business and boosted your odds of survival.  Bringing in new team members can help you prepare for the post-pandemic business environment.  It also offers up the potential for you to upgrade an important element within your business.

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Dealing with COVID-19’s Economic Impact: Planning and Communication are Key

There are many things that you should be doing to deal with the COVID-19 pandemic.  At the top of the list is to be proactive.  Now is the time to be thinking about how best to position your business after the economy has returned to something near normal.  Now is not the time for self-pity.  In fact, not preparing for the relaunch of the economy will cost you.

In David Finkel’s recent Inc. article entitled, “10 Things Every Small-Business Owner Needs to Do to Deal with the Impact of COVID-19 on Their Business,” Finkel outlines the 10 key steps business owners should take immediately.  Finkel is the author of 12 business books and CEO of Maui Mastermind business coaching company.

There is no way of knowing how long the COVID-19 fueled economic downturn will last, and that means time is of the essence.  Business owners, regardless of their particular sector, need to prepare as though the economy could relaunch tomorrow.

Finkel’s 10 Things: 

  1. Take steps to protect your staff and customers from getting sick.
  2. Tell your customers what safety steps you’re taking.
  3. Educate your staff on how to stay healthy at work and at home.
  4. Engage in scenarios planning to deal with how markets could change.
  5. Enlist vendors and suppliers for help.  You should ask them to negotiate payment terms.
  6. Take steps to plan out your cash flow.
  7. Open a dialogue with your management team.
  8. Go on the offensive and look for opportunities.
  9. Get your team together and brainstorm.
  10. Be sure your key leaders communicate in a united fashion.

There are definitely some commonalities amongst these 10 important steps.  You’ll notice that communication and education are at the heart of most of these points. 

There is a lot of fear and uncertainty out there.  More than almost any time in modern history now is the time to communicate.  All business owners should be advised to communicate with their customers, clients, suppliers, staff, and management team in a clear fashion.  Effective communication based around a consistent and logical message can help to reduce fear.  The fear sections of the brain are driven by our primordial ancestors’ dread of the unknown lurking in the darkness.  Part of being a good leader is to reduce those fears whenever possible. 

Another common thread is planning, which includes looking for new opportunities.  Whenever there is chaos and fear, there are also opportunities.  You should be looking for those opportunities, whether it is improving your own business practices or looking for other companies to buy.

Good communication and planning can help you navigate these choppy waters.  Planning for the recovery from COVID-19 pandemic could be the difference between staying in business and going out of business.

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How to Make Remote Teams Accountable

One of the many, many changes that COVID-19 has ushered in is the extreme uptick in people working remotely.  Social distancing has made working from home a necessity for millions. 

The technology that is allowing remote working to take place has matured greatly in the last decade.  Today, it is possible for team members to work from virtually any location.  Of course, as with most technologies, there is a potential downside.  Accountability can become a significant challenge with remote workers.  Of course, the more remote workers you have at a given time, the greater the potential challenges will be. 

Many businesses are struggling with the phenomenon of remote working, as it is something new for them.  Under normal circumstances, large numbers of employees working remotely simply wouldn’t happen.  In a recent article, “The Right Way to Keep Your Remote Team Accountable,” author Elise Keith, Co-Founder and CEO of Lucid Meetings, explores the key steps businesses should take to help ensure that their employees stay on target while working from home.

Starting Slow

Keith believes that for remote working to be effective that there are 4 major mistakes that should be avoided.  One of the biggest mistakes that employers, especially those unfamiliar with remote work, make is that they demand too much productivity right out of the gate. 

She points out that remote teams can, in fact, be very productive and even outperform their in-office counterparts.  Summed up another way, remote work can be extremely productive.  Keith’s perspective is that businesses should “identify the highest priority tasks right now and relax the rest.”  Business owners need to remember that they are not the only ones under stress.  The simple and undeniable fact is that your employees are feeling the stress of COVID-19 as well.

Getting Good at Working Remotely

The second major mistake she points to is that people are assuming the current pandemic situation is temporary.  Other crises will occur in the future, and it makes sense to be prepared.  As she phrases it, why not “get good at working remotely?”  Teams with good remote working skills are proving to be rather resilient right now.

Being Open to Technology

A third mistake she points out is businesses shouldn’t disallow the use of non-approved tools.  In short, now is not the time to worry too much about what software tools people are using.  Instead, she suggests creating an expedited process for the adoption of new tools.  If your team finds a new tool that boosts productivity, you should consider buying it. 

She astutely points out, “Software costs pale when compared to the costs of lost opportunity.”  At the heart of this point is the fact that now, more than any time in decades, is the time to set aside restrictive thinking and become more open-minded and flexible.  After all, your number one goal, and the number one goal of your clients, is to stay in business until the pandemic has passed.

Staying Flexible

Keith’s fourth mistake centers on management’s design to dictate hours and response times.  Remote work is, by its nature, going to be more flexible.  Trying to micromanage every move digitally is simply not a savvy move and will hurt morale. 

Instead, she feels businesses should opt for having a daily meeting via phone or videoconference with the team.  Additionally, she puts forth the idea of having a one-on-one meeting with every team member as well.

For many businesses and many situations, remote work may be the “only game in town.”  Trying to carry on business as usual is only going to cause headaches for everyone.  Remote work can be highly effective for you, especially when used correctly.

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Now is the Time for Focus

As of late April 2020, there is one thought at the forefront of the vast majority of businesses around the globe, namely, what steps do I need to take to stay in business until the COVID-19 pandemic is over or recedes?  There is no doubt about it, this is the “big question” of the day. 

The global economic structure hasn’t seen this much uncertainty since WWII, and some would argue that we’ve never seen this level of simultaneous global economic disruption.  Knowing what steps you need to take to keep your business up and running is of paramount importance. 

In short, business owners must be sure that their businesses are in good shape.  You should take every step possible to position yourself for when the economy is back up and running at full steam.  Right now, there is a degree of chaos and uncertainty, but this will not last.  As a business owner, you need to focus on getting your house in order.

Now is not a time to take a vacation.  Instead, you should be focused like never before on the inner workings of your business.  You should be striving to find ways to improve every single aspect.  Of course, this is easier said than done.  There is a real psychological hurdle, as for many people it seems as though everything has “stopped.”  While customers, clients, and staff interactions have been dramatically reduced, now is not the time for you to “check out” mentally and wait for things to get better.

Rarely, if ever, has it been more important for owners to invest as much of their time and energy as possible.  After all, as a business owner, you have already shown a great deal of drive and determination, as well as at least some level of out of the box thinking.  You have proven that you have what it takes to get through the recent challenges. 

Many will feel dejected right now.  But you should pool on the same skill sets that allowed you to create a successful business in the first place.  What obstacles did you overcome in life to create your business?  Was your business created during a prior economic downturn?  The odds are that you already have skill sets and strengths that will allow you to survive the fallout of COVID-19.

For business owners who truly want to survive the economic stress of the pandemic, ultimately, focus is key to survival.  The odds are excellent that there are revenue streams and different approaches that may have been overlooked.  Your job is to identify and then exploit those avenues.

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Questions for Helping Businesses Survive the COVID

Developing Your 90-Day Plan

Those who want to make sure their businesses survive this pandemic will want to achieve a laser-like focus.  It is important to realize that the forced downtime triggered by the pandemic affords you the opportunity to work on potentially neglected aspects of your business. 

Summed up another way, now is the time for dynamic and focused action.  In this article, we’ll address what you can do to help your business survive this unusual time period. 

Reevaluating Your Business

It’s time to step back and look at every aspect of your business, including your processes.  You should be encouraged to find new ways of doing things.  In short, now should be viewed as a time of opportunity to reboot your business.  That way when the pandemic has subsided, and your business picks up once more, it is more efficient, more effective, and more competitive.

Scott Bushkie, Founder and President of Cornerstone Business Services, recommended that business owners create 90-day plans where they look for ways to innovate.  This strategic plan should focus on what they are going to do and what they want to accomplish.  It is critical that there is an actual plan that achieves tangible results and not simply a list of things that should be accomplished.  Listed below are a few questions you should be pondering.

  1. How can I outperform the competition?
  2. How can I innovate?
  3. How can I increase my use of technology?
  4. How can I deliver my products and services in a different way?
  5. How can I reduce my operational costs?
  6. Have I reached out to my suppliers and creditors for assistance?
  7. Have I applied to applicable SBA COVID-19 focused programs?
  8. What do I want to accomplish in the next 90-days? 

It’s Time to Reboot

The main point is that businesses should not look at this pandemic situation as some sort of “miserable and stressful vacation,” but instead as an opportunity to reboot what is not working, and look for ways to make improvements in every aspect of your business.  This process begins by asking the right questions and striving to find the answers.

In answering these questions and finding ways to help boost your rates of survival, you should turn to every asset at your disposal.  Why not ask your management team as well as all of your employees for ideas that could help their business?  Everyone should understand that owners are looking for ways to keep their business healthy while navigating the pandemic.

Now is the time for reflection, short-term and long-term planning, and tangible actions.  Business owners should also consult with a range of business professionals, including, of course, business brokers and M&A Advisors.  Brokers are uniquely positioned to help business owners through this crisis.

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6 Tips and 90 Days to Protect Your Business

There can be no way around it, Inc. contributor Brian Hamilton’s April 2020 COVID-19 centered article, “6 Actions to Take in the Next 90 Days to Save Your Business,” isn’t pulling any punches.  Hamilton, Founder of the Brian Hamilton Foundation, believes that the next 90-days could be make or break days for business owners looking to navigate the choppy waters of the COVID-19 pandemic.  His latest Inc. article provides readers with 6 actions they should take now to survive the economic fallout of the COVID-19 pandemic. 

Tip #1 Vigorously Control What You Can

Hamilton’s first tip is to “Vigorously control what you can.  Vigorously ignore what you can’t control.”  As Hamilton points out, you can’t control the economy; instead, you need to focus on what you can control.  His view is that there has never been a more important time to focus, “More than ever, you’ll need to go to war with things within your control.”  Now is the time to exercise control.

Tip #2 Guard Morale

During tough economic times, employee morale can be a real issue.  This brings us to Hamilton’s second point, “guard employee morale.”  Significant drops in employee morale can lead to serious problems with your business, which is exactly what you don’t want to see right now.  Hamilton notes that you have to be the general that helps his or her troops rise above potential panic.

Tip #3 Preserve Cash

Hamilton’s third tip is to “preserve cash where you can.”  He states, “Right now, your motto should be: Live to fight another day.”  The pandemic means that you need to keep expenses down and watch every dollar.  No one knows what the next few months, or the next couple of years, could have in store.

Tip #4 Be First in Line

“Be first in line,” is Hamilton’s fourth point.  Hamilton wisely pushes business owners to be the first in line for government assistance.  This is very good advice, as SBA and other funds are likely to be limited.

Tip #5 Get Back to the Basics

Fifth, Hamilton recommends, “Get back to the basics…starting with monomaniacal customer service.”  As always, customers, whether existing or new, are the lifeblood of your business.  You can’t afford to lose customers now and for this reason, you need to have a laser-like focus on customer service. 

Tip #6 Pivot your Product or Service 

Hamilton’s sixth tip is to “Pivot your product or service to new conditions.”  Small changes to your business can open up new streams of revenue.  Even if these streams of revenue are comparatively small, they could mean the difference between sink or swim!  Try to step back and look at your business with fresh eyes and strive to find ways to offer something new to your customers.  Whatever you offer should be based on your existing goods and services and not require a new, large expenditure.

The COVID-19 pandemic is obviously disruptive, but it won’t last forever.  Hamilton’s advice of focusing intensely on the next 90 days is sound advice.  You won’t regret looking for ways to safeguard your business for the next 3 months.

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Improving Your Telework Habits

In her recent April 20th, 2020 Forbes article, “Three Keys to Engaged, Productive Telework Teams,” author Rajshree Agarwal, who is a professor of Strategy and Entrepreneurship, explored how to get the most out of telework.  This highly timely article covers some very important territory for many companies dealing with the COVID-19 pandemic.  Let’s explore Agarwal’s key points so that you can help your team get the most out of telework.

Agarwal notes that people may tend to shy away from sharing personal information and feelings while in the office.  But via video conferencing, the story can be different.  For this and other reasons, it is necessary for employers to keep in mind that the dynamic between you and your employees may be different when you use video conferencing.  This will also often be the case when your employees speak with one another. 

She prudently cautions business owners from taking a “business-as-usual” approach to the COVID-19 situation, as it can make them look both unnecessarily cold and out of touch with reality.  On the flip side, however, it is also important to not dwell on the negative aspects of the pandemic.  Offering some sense of normalcy during the COVID-19 pandemic is a smart move as well. 

How you use telework and video conferencing is, in part, about developing the correct balance.  On one hand, you’ll want to acknowledge that the situation is serious and must be addressed.  But on the other hand, you don’t want to dwell on the pandemic.  After all, not effectively handling the work at hand could undermine your business and cause other problems for both you and your employees. 

It is in everyone’s best interest to be smart, safe, and acknowledge the bizarreness of the current situation while striving to achieve business goals.  The keyword here is “balance.”  Agarwal states that “The combination of empathy and purpose unifies individuals, allowing team members to channel their efforts towards shared objectives and values.  This is the best antidote for anxiety.”

From Agarwal’s perspective, there are three keys to making telework effective: communication, socialization, and flexibility.  First, there has to be good communication.  For example, people can’t simply ignore one another’s emails because they are working virtually.  She points out that real-time meetings via Zoom or Skype can eliminate some communication issues, but not all. 

The second factor to consider is socialization.  As Agarwal points out “Engaged, productive teams also take time to socialize.”  Working from home alters the typical modes and methods of socialization, but virtual interactions can be used to help people form and develop their social networks. 

In short, socialization doesn’t have to end once telework begins.  Used judiciously, socializing, and the bonds it creates between co-workers can still continue. 

Agarwal’s third key is flexibility.  Flexibility is critical, as all team members must adjust to what, for some, may be a fairly radical restructuring of their day-to-day work experience.  Those who haven’t worked virtually before may find adjusting to be quite a challenge.  Management should strive to be more flexible during telework caused by the COVID-19 pandemic.  Trying to maintain the same top-down approach could prove to be problematic.

It goes without saying that telework presents challenges.  However, the challenges it represents are not insurmountable.  There are benefits to teleworking, and teams can use it to generate solutions that they might have not reached in the typical work environment.

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Don’t Fear Failure, Learn from It Instead

Failure is rarely fun.  But it is also a key ingredient in success.  While failure can be painful, there is no doubting the fact that the lessons that come from failure can be powerful teachers that provide life-long lessons and even life-trajectory altering results.  Summed up another way, failure hurts.  But on occasion, not failing could hurt more, especially in the long run.

In her Inc. article, “Why Tons of Failure Is the Key to Success, According to Seth Godin,” author Sonia Thompson, CEO of Thompson Media Group, points out that most people “avoid failure like the plague.”  Instead, they spend their time trying to achieve perfection.  In the process of adopting this approach, people miss all kinds of opportunities because they are afraid of damaging their egos.  Embracing failure is a way to experience many “transformational benefits,” which would never be experienced without the lessons of failure.

Thompson points to the work of 18-time best-selling author Seth Godin who has written about how entrepreneurs who fail more often perform at a higher level.  She quotes Godin as follows, “The rule is simple.  The person who fails the most will win.  If I fail more than you do, I will win.  Because in order to keep failing, you’ve got to be good enough to keep playing.”  Godin continues that failure imparts a gift of sorts in that it teaches us how to distinguish between a good idea and a bad idea.

As Thompson notes, research supports the notion that if you want a breakthrough idea, you will need to “produce an enormous volume of ideas.”  Obviously, most ideas won’t work, but that isn’t the issue.  The issue is to work your way through the bad ideas to get to the winners.  Sure, it would be great to have nothing but winners.  But life and reality don’t work that way.  Failure should be seen more as a path forward than the end of the road.

Getting comfortable with failure, in Thompson’s view, is critically important.  She believes entrepreneurs should take steps that make them more comfortable with failure, such as detaching oneself from the results. 

It is vital to remember that you are not the work.  In contrast, the work is part of an ongoing process.  Getting good at something takes time, and there will be failures.  For this reason, entrepreneurs simply must embrace a “growth mindset.”  Don’t think of failure as failure, but instead as part of a learning process.  There is no denying that this approach will make you calmer and that, in turn, may help you make better decisions.

There will be failure in life.  There will be problems and there will be obstacles.  Much will happen that you can’t predict, manage or control, such as the COVID-19 outbreak.  The trick is to focus on what you can control and move forward without a paralyzing fear of failure.  Because in the end, failure may be one of your best tools.

Copyright: Business Brokerage Press

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How to Connect During a Crisis

Small business owners are facing new challenges during this crisis.  Communicating with customers requires more focus and depth than ever before.  In Mat Zuker’s latest article for Forbes Magazine, he cites Jay Mandel who runs The Collective NYC, a marketing consulting team focusing on a customer’s experience, who underlines the importance of businesses to understand their mission statement and values in order to re-enforce marketing strategies. 

Information is Crucial.  Each customer purveying your business’s website needs to understand your hours of operation, any limitations to service and what is being done to ensure cleanliness.  Providing this information establishes to your customer your seriousness of precautions which will be appreciated during this time.

If your financial situation allows, focus on your employees, donate to charities or offer discounted or free products.  By marketing this information, your brand’s scope will bolster with the customer as well. 

Utilizing the Customer’s Time.  Most customers are adhering to social distancing guidelines put forth by their state and the federal government.  Now, more than ever, it is important to exhibit to your customers how your brand can be utilized beyond your brick and mortar.  Zuker cites how universities are beginning to offer free online classes and telecommunication companies are offering two months of free service to low-income families; King Arthur flour is promoting its library of comfort food recipes (yes, please!).  Thinking beyond your storefront to put your service or product into your customer’s virtual hands is important.

Remember to entertain.  By each passing day, customers are looking for new stimulation to help the time go by at home.  Movie companies are making the best of the situation by sending theatrical releases to online streaming services.  We don’t think it is necessary to always make your customers laugh, but it might be within your branding to aim for content geared towards warmth, humanity and empathy. 

The metric for engaging your customers is changing; moving beyond views and shares to quality feedback or social impact on your community.  Do not bite off more than you can chew.  Cited in Zuker’s article, Social Media Today warns of virtue signaling; meaning declaring a set of values, but not following through on the actual deeds. 

Also, this is a fantastic opportunity to consider your marketing strategies for when this crisis ends.  What will your business look like once you are able to open the doors?  How are you able to stay relevant with your competitors?  These are all questions needing answers, but today we must do our best to accomplish what is in front of us. 

Read Mat Zucker’s full article here: https://www.forbes.com/sites/matzucker/2020/04/01/content-in-a-crisiswhat-brands-can-deliver/

Copyright: Business Brokerage Press, Inc.

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IBBA and M&A Source Market Pulse Survey Report Predicts Major Changes

The IBBA and M&A Source Market Pulse Survey Report for the fourth quarter of 2018 has a range of interesting insights.  The survey’s purpose is to provide an “accurate understanding of market conditions for businesses being sold in Main Street (values $0-$2MM) and the Lower Middle Market (values $2MM-$50MM).  This national survey was designed as a tool for business owners and their advisors and has the support of both the Pepperdine Private Capital Markets Projects and the Pepperdine Graziadio Business School.

One of the most striking facts to leap out of the report is the fact that a full one-third of advisors fully expect the strong market to end this year.  Overall, advisors are not optimistic that the current climate will continue through 2020.  In fact, advisors are encouraging sellers to consider placing their businesses on the market now, while the market is still strong.  This is according to Craig Everett, PhD and Assistant Professor of Finance and Director of the Pepperdine Private Capital Markets Project.

One fact from the report that could be overlooked is that only a mere 8% of advisors expect the current climate to last for 48 months or more.  Additionally, only 9% believe that the current climate will last between 24 to 48 months.  Perhaps most striking of all is the fact that 60% of advisors feel that the current climate will end within the next two years.

Business owners who are considering selling should be advised that almost two-thirds of advisors now feel that there will be a significant shift in the next two years.  Considering that it can take a year or more to sell a business, business owners would be wise to consider this important fact.

The report sites Neal Isaacs, Owner of VR Business Brokers of the Triangle who states, “Deals are taking longer in due diligence as buyers work hard to validate their investment and make sure that what they’re buying is worth the premium price today’s sellers are commanding.”

So, is now the time to sell?  Many experts feel that it is possible to lose a sizable amount of value if one waits too long to sell.  Even just a few months can make a huge difference in terms of perceived value and the ultimate sales price.  Working with a proven business broker is a key way to ensure that you are selling at the right time and secure the best possible price.

Copyright: Business Brokerage Press, Inc.

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5 M&A Myths and How to Deal with Them

Where your money is concerned, myths can do damage.  A recent Divestopedia article from Tammie Miller entitled, Crazy M&A Myths You Need to Stop Believing Now, Miller explores 5 big M&A myths that can get you in trouble.  Miller points out that many of these myths are believed by CEOs, but that they have zero basis in reality.

Myth 1

The first major myth Miller explores is the idea that the “negotiating is over once you sign the LOI.”  The letter of intention is, of course, important. However, this is by no means the end of the negotiations and it is potentially dangerous to think otherwise.  The negotiations are not concluded until there is a purchasing agreement in place. As Miller points out, there is a great deal that can go wrong during the due diligence process.  For this reason, it is important to not see the LOI as the “end of the road.”

Myth 2

Another myth that Miller wants you to be aware of is that you don’t have to take a company’s debt as part of the purchase price.  Many business brokers, such as Miller, recommend that buyers don’t take seller paper.

Myth 3

A third myth that Miller explorers is a particularly dangerous one.  The idea that everyone who makes an offer has the money to follow through is, unfortunately, simply not true.  Oftentimes, people will make offers without securing the money to actually buy the business.  No doubt, this wastes everyone’s time.  As the business owner, it can derail your progress.  If you are not careful, it could actually prevent you from finding a qualified buyer.

Myth 4

Another myth is built around the notion that sellers don’t need a deal team in order to sell their business.  Again, this is another myth that has no real foundation in reality.  While it may be possible to sell your business without the assistance of an experienced M&A attorney or business broker, the odds are excellent that doing so will come at a price.  According to Miller, those working with an investment banker or business broker can expect, on average, 20% more transaction value!

Additionally, there are other dangers in not having a deal team in place.  A business broker can handle many of the time-consuming aspects of selling a business, so that you can keep running your business.  It is not uncommon for business owners to get stretched too thin while trying to both run and sell a business and this can ultimately harm its value.

Myth 5

Miller’s final myth to consider is that you must sell your entire business.  It is true that most buyers will want to buy 100% of a business, but a minority ownership position is still an option.  There are many reasons to consider selling a minority stake, so don’t assume that selling your business is an “all or nothing” affair.

Ultimately, Miller lays out an exceptional case for the importance of working with business brokers when selling or buying a business.  Business brokers can help you avoid myths.  In the end, they know the lay of the land.

Copyright: Business Brokerage Press, Inc.

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10 Questions Everyone Should Ask Before Signing on the Dotted Line

Before buying any business, a seller must ask questions, lots of questions.  If there is ever a time where one should not be shy, it is when buying a business.  In a recent article from Entrepreneur magazine entitled, “10 Questions You Must Ask Before Buying a Business”, author Jan Porter explores 10 of the single most important questions prospective buyers should be asking before signing on the dotted line.   She points out to remember that “there are no stupid questions.”

The first question highlighted in this article is “What are your biggest challenges right now?”  The fact is this is one of the single most prudent questions one could ask.  If you want to reduce potential surprises, then ask this question.

“What would you have done differently?” is another question that can lead to great insights.  Every business owner should be an expert regarding his or her own business.  It only makes sense to tap into that expertise when one has the opportunity.  The answers to this question may also illuminate areas of potential growth.

How a seller arrives at his or her asking price can reveal a great deal.  Having to defend and outline why a business is worth a given price is a great way to determine whether or not the asking price is fair.  In other words, a seller should be able to clearly defend the financials.

Porter’s fourth question is, “If you can’t sell, what will you do instead?”  The answer to this question can give you insight into just how much bargaining power you may have.

A business’ financials couldn’t be any more important and will play a key role during due diligence.  The question, “How will you document the financials of the business?” is key and should be asked and answered very early in the process.  A clear paper trail is essential.

Buying a business isn’t all about the business or its owner.  At first glance, this may sound like a strange statement, but the simple fact is that a business has to be a good fit for its buyer.  That is why, Porter’s recommended question, “What skills or qualities do I need to run this business effectively?” couldn’t be any more important.  A prospective buyer must be a good fit for a business or otherwise failure could result.

Now, here is a big question: “Do you have any past, pending or potential lawsuits?”  Knowing whether or not you could be buying future headaches is clearly of enormous importance.

Porter believes that other key questions include: “How well documented are the procedures of the business?” and “How much does your business depend on a key customer or vendor?” as well as “What will employees do after the sale?”

When it comes to buying a business, questions are your friend.  The more questions you ask, the more information you’ll have.  The author quotes an experienced business owner who noted, “The more questions you ask, the less risk there will be.”

Business brokers are experts at knowing what kinds of questions to ask and when to ask them.  This will help you obtain the right information so that you can ultimately make the best possible decision.

Copyright: Business Brokerage Press, Inc.

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A Step by Step Overview of the First Time Buyer Process

A recent article on Businessbroker.net entitled, First Time Buyer Processes by business broker Pat Jones explores the process of buying a business in a precise step-by-step fashion.  Jones notes that there are many reasons that people buy businesses including the desire to be one’s own boss.  However, he is also quick to point out that buyers should refrain from buying a business that they simply don’t like.  In the quest for profits, many prospective owners may opt to do this, but it could ultimately lead to failure.

Step One – Information Gathering

For Jones, there are seven steps in the business buying process.  At the top of the list is to gather information on businesses so that one has an idea of what kind of businesses are appealing.

Step Two – Your Broker

The second key step is to begin working with a business broker.  This point makes tremendous sense; after all, those new to the business buying process will benefit greatly from working with a guide with so much experience.  Business brokers can gain access to information that prospective business owners simply cannot.

Step Three – Confidentiality and Questions

The third step in the process is to sign a confidentiality agreement so that you can learn more about a business that you find interesting.  Once you have the businesses marketing package, you’ll want to have your broker schedule an appointment with the seller. It is vitally important that you prepare a list of questions on a range of topics.  There is much more to buying a business than the final price tag.  By asking the right questions, you’ll be able to learn more about the business and its long-term potential.

Step Four – Evaluation

In the fourth step of the business buying process, you’ll want to evaluate all the information that you have received from the seller.  Once again, a business broker can be simply invaluable, thanks to years of hands-on experience, he or she will know how to evaluate a seller’s information.

Step Five – The Decision

In the fifth step, you’ll need to decide whether or not you are making an offer.  If you are making an offer, you will, of course, want it to be written and include contingencies.

If your offer is accepted, then the process of due diligence begins.  During due diligence, you and your business broker will look at everything from financial statements to tax returns.  You will evaluate the company’s assets.  Again business brokers are experts at the due diligence process.

Buying a business is an enormous commitment.  Making certain that you’ve selected the right business for you is one of the most critical decisions of your life.  Having as much competent and experienced help as possible is of paramount importance.

Copyright: Business Brokerage Press, Inc.

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Baby Boomers About to Spark the Turn in Businesses

Pending business sales are building as baby boomers, ages 49-67, enter the twilight of their careers.

First gradually, and then in a flood, mind-boggling assets from the sales will surge to heirs, savings accounts, luxury cars, vacation homes, pet philanthropic pursuits and anything else the generation fancies–reconfiguring the economy.

Business brokers and estate attorneys thought the sales would begin in earnest nearly a decade ago. But the baby boomers, lulled into complacency by the hot economy, lingered to eke out more profits and keep themselves employed a little while longer.

Then the recession, hardly anyone predicted, rudely swept away some of the businesses, and the surviving owners fought to keep their doors open as they watched the value of the businesses dive. Many borrowed heavily to stay afloat.

Today, conditions to spark the long-anticipated wave of sales are turning favorable because:

Click here to read this article further.

Business Broker helps Seller Concerns

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.

Raleigh Business Brokers – Sell a Business Yourself?

Raleigh Business Brokers – Sell a Business Yourself?

Many business owners are hesitant to hire a professional business broker to sell their business because the owner does not want to pay a commission.  The problem with this thought process is that the owner will often unknowingly leave a substantial amount of money at the closing table by accepting a Sale Price that is substantially less than the price a professional business broker would have obtained, net of the business broker’s commission.

When a business owner makes the decision to sell a business, he or she is taking a giant step that involves the emotions as well as the marketplace, each with its own set of complexities.  Those sellers who are tempted to undertake the transaction on their own should understand both the process and the emotional environment that this process is set against.  The steps outlined below are just some of the items for a successful sale.  

While these might seem daunting to the do-it-yourself owner, by engaging the help of a professional business broker, the seller can feel confident about what is often one of the major decisions of a lifetime.

1. Set the stage
What kind of impression will the business make on prospective buyers?  The seller may be happy with a weathered sign (the rustic look) or weeds poking up through the pavement (the natural look), but the buyer might only think, “What a mess!”  Equally problematic can be improvements planned by the seller that appeal to his or her sense of aesthetics but that will, in fact, do nothing to benefit the sale of a business.  Instead of guessing what might make a difference and what might not, sellers would be wise to seek the advice of a business broker–a professional with experience in dealing regularly with buyers and with an eye experienced in properly setting the business scene.

2. Get the record(s) straight
Although outward appearance does count, what’s inside the books is even more important.  Ultimately, a business will sell according to the numbers. The business broker can offer the seller invaluable assistance in the presentation of the financials.

3. Weigh price against value
All sellers naturally want to get the best possible price for their business.  However, they also need to be realistic.  To determine the best price, a business broker will use industry-tested pricing techniques that include ratios based on sales of similar businesses, as well as historical data on the type of business for sale.

4. Market professionally
Engaging the services of a professional business broker is the key to the successful marketing of a business.  The business broker will prepare a marketing strategy and offer advice about essential marketing tools–everything from a business description to media advertising.  Through their professional networks and access to data on prospective buyers, business brokers can get the word out about the business far more effectively than any owner could manage on an individual basis.

We have a strong backlog of buyers seeking all types of companies.  Contact your 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 Raleigh to confidentially discuss “your” situation today!

What’s Selling

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.

Retail businesses 17%
Food & Drink related business 14%
Auto related businesses 9%
Distribution type businesses 11%
Manufacturing businesses 16%
Service type businesses 25%
Other 5%
Professional Practices 3%

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!

Pittsburgh Business Brokers – Best Time to Sell?

Pittsburgh Business Brokers – Best Time to Sell?

Many experts say that the best time to sell is when the business is better than it’s ever been.  This may be good advice, but few follow it.  Why sell when business is good?  You just suffered through a few not-so-great years and now the experts are telling you to sell?  Right or wrong – good or bad – the decision to sell is generally event-driven.  For example: declining health, a partnership break-up, personal issues, too much competition, family member elects not to purchase the business, etc.  Retirement sounds like a good reason, but it has no time pressure, unless a seller has made the decision to retire at a certain age.  Even then, when the seller realizes that he or she will have nothing to do after a sale…the idea loses its appeal.

However, one thing that a seller can do, without creating any pressure about selling or not selling, is to take a bit of time every year and prepare – just in case.  This means tying up loose ends.  Make sure financial records are current and complete, leases reviewed and renewed if necessary, any litigation resolved if possible, licenses and permits updated, agreements and contracts renewed and updated if necessary.  You could call this eliminating the surprises, and you could also call it good business.

By doing this, if a potential sale comes out of nowhere – you’ll be ready.

We have a strong backlog of buyers seeking all types of companies.  Contact TM Business Brokers –  your Raleigh | Pittsburgh 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!

Pre-Selling Considerations

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!

Will Your Business Sell?

Will Your Business Sell? – Pittsburgh Business Brokers

At TM Business Brokers, your Pittsburgh Business Brokers, we are often asked:  what are the odds my business will actually sell?  Well, for businesses with annual sales of $750,000 or less, research indicates that the odds of your business selling are only 18 percent.  If annual sales are $750,000 to $2 million, the odds increase to 25 percent.  If the annual sales is above $2 million, the odds increase to 30 + percent.  Note that approximately 75 percent of all businesses have annual sales of less than $750,000.

What does this all mean?  To put it bluntly: if you are thinking of selling your business, you have about a one in five chance of it actually selling.  This obviously begs the question: why are the odds so poor?  One would think that if you put your business on the market, it should sell in a reasonable length of time.  Here are some reasons why some businesses don’t sell – as explained by various business brokers and intermediaries.  They are excerpted from an article in INC magazine, April 2002.

  • The cash flow was strong, but a lot of buyers thought that the deal was overpriced.
  • Buyers were intrigued, but the economics of the deal didn’t make sense, and the seller wouldn’t negotiate.
  • There was serious interest, but the owner got distracted by an arrangement with a friend to solicit offers.  None came through.
  • We almost had a deal, but financing was impossible to find.
  • We had three offers, including an accepted bid for $4 million, but the buyer couldn’t get financing.
  • The deal dragged on for months but fell apart for lack of financing.

They say that timing is everything.  Many business owners wait until the economy is down.  Their own business is also paying the price for the slowdown, so they elect to sell.  Now they discover that the price they thought they could get for their business is not realistic in today’s market.   Sellers should keep in mind that the best time to sell is when their business is doing well.

One factor that emerges from the comments by intermediaries above is the lack of financing.  This would seem to indicate that the sellers wanted all cash, or, at least, a good portion of the selling price in cash.  Three of the above comments stated that the reason the deal didn’t go through was that “financing was impossible to find,” “the buyer couldn’t get financing,” and “…fell apart for lack of financing.” The reasons that obtaining financing is so difficult are (1) the business doesn’t qualify for financing, (2) the buyer doesn’t qualify for financing, and, most importantly, most small businesses are not financeable.  Banks are generally not interested; the Small Business Administration (SBA), although certainly an option, only comes through in less than 10 percent of deals.  If lenders are not interested in financing the sale of the business, there are only two choices: the buyer pays all cash or the seller finances the sale.

Tips for a fast sale

  • Have up-to-date financial information available
  • Prepare a current list of fixtures & equipment
  • Maintain normal business hours
  • Spiff up the business
  • Set a realistic price
  • Be willing to negotiate
  • Gather all of the information a buyer might like to review

Here are two major ways to increase the odds that your business will be the one in five that sells:

  • Make sure that you are serious before you put your business up for sale.  You should be willing to accept, within reason, what the marketplace is willing to pay.  It’s not what you want for your business, or what your accountant says it’s worth – it’s what a buyer is willing to pay.  Find out if the price you are asking is in the “ballpark” before you go to market.  Your local business brokerage professional is a good place to start.  He or she can tell you what similar businesses have sold for and what you might expect to receive if you sell now.
  • Be willing to finance the sale of your business.  Counting on the businesses selling for all cash or assuming that the business can be financed will most likely make your business one of the four that don’t sell.  By showing your willingness to assist in the financing, you reassure the buyer that you have confidence in the businesses’ ability to finance itself.  Also, keep in mind that by financing the business you will be entitled to interest on the balance, thereby increasing the price you will receive.

Following these guidelines and tips might not sell your business, but it will certainly increase the odds.  Almost any business will sell under the right circumstances.  If you are serious about selling, the first step would be to call a professional business broker.  He or she can answer all of your questions about the selling process and what it takes to sell your business in today’s economic climate.

The Perfect Business

The perfect business, the one that would be sure to sell, has the following attributes:

  • a reasonable price
  • a reasonable down payment (hopefully 40 percent of the full price or less)
  • seller financing
  • reasonable sales (hopefully increasing each year)
  • seller earnings of $60,000 or more
  • a compelling reason for sale
  • a desired or popular industry type
  • attractive and strategic location (if important for business type)

There is an old saying that goes something like this: “The worst day of working for yourself is better than the best day of working for someone else.”

Work on Your Books

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!

Reasons People Sell a Business

Pittsburgh Business Brokers – Reasons People Sell a Business

Individuals have any number of reasons for starting a business, but new research has found that there three main reasons owners sell their businesses.  That research found that owners whose businesses were worth more than $5 million sold their businesses to avoid tax changes, to retire, to avoid burnout and to pursue new opportunities.

One group in particular is driving the sales of many of these businesses, the researchers found.

Read more: https://smallbusiness.foxbusiness.com/sbc/2012/12/11/no-1-reason-people-sell-business/

We have a strong backlog of buyers seeking all types of companies.  Contact TM Business Brokers –  your Pittsburgh 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 or Buy a Business?

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!

Looming Tax Hike Motivates Owners

TM Business Brokers Raleigh say a looming increase in the capital-gains tax rate next year is fueling sales of some privately-held businesses.

Many business owners—mostly founders who could gain a lot from a sale—are looking to close deals before next year, when the maximum tax on investment income is scheduled to rise from 15% currently to at least 23.8% on most capital gains, at least for higher-income households.  Many sellers intend to convert their equity into retirement funds or just start anew.

“It just made more sense for me to take my chips off the table and go do something else,” said Bert Wolf, 60 years old, who has an agreement to sell his compressed-gas business, Acetylene Oxygen Co. of Harlingen, Tex., before year-end.

Mr. Wolf added that if he waited until after the tax increase to sell, he would have to expand the business at the current rate “for at least 3 or 4 more years to achieve the same after-tax sales dollar.”  He is profiting on the sale of his business to Praxair, Inc, a public company.

“There’s a kind of a panic on to get things done,” said Beatrice Mitchell, co-founder of Sperry, Mitchell & Co. Inc., a New York investment bank that is advising Mr. Wolf on the sale.

To be sure, the weak economy has been difficult for many small-business owners across the board.  The median selling price for U.S. small businesses in the quarter ended Sept. 30 was $174,000 down 8.2% from four years earlier, according to BizBuySell.com, an online small-business marketplace.  The firm’s findings are based on sales, reported voluntarily by business brokers and mostly of less than $1 million, in 70 major markets.

Read more:

https://online.wsj.com/article/SB10001424052970204789304578088931525397120.html?mod=WSJ_SmallBusiness_LEFTTopStories

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!

 

 

You Want How Much for Your Business?

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!

Best Time to Sell Your Business?

TM Business Brokers Raleigh – Best Time to Sell Your Business?

The best time to sell your business is when the business is better than it’s ever been.  This may be good advice, but few follow it.  Why sell when business is good?  You just suffered through a few not-so-great years and now the experts are telling you to sell?  Right or wrong – good or bad – the decision to sell is generally event-driven.  For example: declining health, a partnership break-up, personal issues, too much competition, family member elects not to purchase the business, etc.  Retirement sounds like a good reason, but it has no time pressure, unless a seller has made the decision to retire at a certain age.  Even then, when the seller realizes that he or she will have nothing to do after a sale…the idea loses its appeal.

However, one thing that a seller can do, without creating any pressure about selling or not selling, is to take a bit of time every year and prepare – just in case.  This means tying up loose ends.  Make sure financial records are current and complete, leases reviewed and renewed if necessary, any litigation resolved if possible, licenses and permits updated, agreements and contracts renewed and updated if necessary.  You could call this eliminating the surprises, and you could also call it good business.

By doing this, if a potential sale comes out of nowhere – you’ll be ready.

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!

Pittsburgh | Raleigh Business Brokers – Preserving the American Dream…

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 – Small Businesses Fear Fiscal Cliff

Pittsburgh | Raleigh Business Brokers – Small Businesses Fear Fiscal Cliff

A recent survey indicates many business owners do not believe the country will avoid the tax increases and deep spending cuts that are set to take effect at year-end unless Congress and President Barack Obama agree on a new deficit-reduction plan.  A survey of the 833 business owners found that 47% of small-business owners and chief executives share this opinion.  In comparison, 38% of respondents said they thought lawmakers would be able to reach an agreement.  Another 14% weren’t sure.

In the survey, 62% said they favor repeal of Mr. Obama’s Affordable Care Act and 94% said they offer health insurance to their employees.

More than two-thirds of the respondents said they plan to vote for Mr. Romney, versus 19% for Mr. Obama.

Read more:

https://online.wsj.com/article/SB10000872396390443493304578034342001402834.html?mod=WSJ_SmallBusiness_LEFTTopStories

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 – Selling Your Business?

Pittsburgh | Raleigh Business Brokers – Selling Your Business?

Millions of companies are sold or transferred annually.  To most business owners, the sale of a business is a first time experience and for most a once in a lifetime event.  Accordingly, sellers should have your Pittsburgh | Raleigh Business Brokers – TM Business Brokers on your side.  Here’s some additional items to consider.

A corporate buyer, however, may have been involved in quite a few transactions – some that worked and some that did not..  What does this mean for the seller?  The acquirer may have an experienced team or have been through the business transaction process more than once resulting in a lopsided contest — the amateur (the seller) versus the professional (the acquirer).

Selling a business is not like selling real estate.  Confidentiality is, in most cases, critical.  A seller does not want employees, suppliers, and customers/clients to be aware of a possible sale.  The sales process also cannot distract the owner(s) from managing the day-to-day operation of the business.  Real estate is also much easier to finance than a business purchase, unless the acquirer is a first-rate company.

It is important that sellers do their own due diligence on a prospective acquirer to make sure that the acquirer can complete the transaction if both sides are in complete agreement on terms and conditions.  The seller has most likely retained a professional intermediary, paid that firm a retainer, retained legal and accounting professionals, etc.  Since the potential acquirer will want to do his or her own due diligence, it is important that the seller do so also.

Where is the Money?

All acquirers, whether big or little, should be able to show the seller that they have the financial resources to make the deal.  Unless the acquirer is a large and successful company, where acquisition funds are not an issue, an acquirer’s financial statements and/or the company’s financial statements should be made available.  A credit report would also be important.  An acquirer who can complete the sale, subject to due diligence, should not have difficulty supplying this information.

What do References Reveal?

A seller should check for information about any prior deals that the acquirer has made.  This would include any financing contacts or other lenders.  This list would include any previous acquisitions.  Talking to a previous seller can reveal how their deal went; how the acquirer was to work with; whether they did everything they said they would; etc.  Talking to managers of previous acquisitions by the buyer can tell a seller how employees were treated, etc.

Does the Chemistry Work?

It is important that the chemistry clicks between the seller and the acquirer.  Due diligence on both sides can help build the trust necessary for the deal to work both ways.  If the seller is staying with the company for an extended period of time, it is also critical that he or she is comfortable not only with the acquirer, but also with the new management team if it’s not the people who are doing the deal.

Several million businesses change hands every year.  The vast majority of sellers are selling a business for the first time.  It’s very important that they use professional help. Without it, they may likely receive less than fair value, be involved in a difficult selling experience, and may not receive all of the monies due them.  Professional advisers such as intermediaries, lawyers (only those with deal experience) and accountants are necessary.

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!

Steps Sellers Can Take to “Sell My Business”

Steps Sellers Can Take to “Sell My Business” – Pittsburgh | Raleigh Business Brokers

A potential Seller inquired yesterday “what steps can I take to increase my chances of selling my business?”  We are often asked this question.  As our first reply, we always recommend using your professionals at Pittsburgh | Raleigh Business Brokers

In addition to using an experienced, professional business broker, there are specific steps you can take to increase the chance of a successful closing.

Know why you want to sell your business.  
Before placing your business for sale, it is important that you both know why you want to sell your business and that you are certain about this decision.

Have a plan for what you will do following the closing.

Make sure important parties are on board.  The time to discuss the sale of your business, as well as future plans, with partners, spouses, children and other involved parties is before you list.

Communicate to your outside advisors that you want the deal to work.  Protect your interests, but don’t kill the deal!

Finally, Choose your battles.  Both buyers and sellers need to be willing to compromise.  It is helpful to consider in advance the areas that are most important to you so you can come to the table with a willingness to compromise in other areas.  There must be a win-win for both seller and buyer.

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?

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!

Financing Availability / Applying for SBA Loans

Financing Availability / Applying for SBA Loans

A recent survey of 260 business brokers across the nation revealed the following:

68.8 percent said that financing availability has not improved since 2011.  That percentage is virtually unchanged from August 2011, when 67.8 percent of surveyed brokers said financing had not improved from 2010.

Respondents were not optimistic for the remainder of 2012 either as 72.9 percent of brokers expect no change in funding availability through the rest of the year.  Another 19 percent believed financing availability will tighten even further.

Buyers are ready to buy and sellers are ready to sell, but without third-party financing help, they are being forced to find new ways to piece together deals.  Of course, sometimes they can’t find a solution and, as a result, some good deals aren’t getting done.

Lending Restrictions Most To Blame

Banks took the most heat from business brokers for the lack of available financing, with 55.0 percent of respondents explaining that conditions aren’t improving because “banks continue to have more stringent lending policies.”  Government actions made little to no difference, cited 40.8 percent of surveyors, and 36.2 percent noted that the loan process has become more difficult since 2011.  In short, most brokers see a very tough financing environment that is discouraging potential buyers and causing them to give up looking for funding.

Seller Financing the Solution

With third-party financing so hard to secure, most business owners have turned to seller financing as a way of enticing prospective buyers.  Nearly 50 percent of brokers surveyed listed seller financing as “essential” in speeding up the business sale process and another 40 percent cited it as “important”.  Only two percent found it unnecessary in today’s market.

In addition, one-third of brokers surveyed indicated that nearly all small business sales included seller financing while a further 35.5 percent of brokers indicated that most (i.e., 60 to 89 percent) of the deals they see include seller financing.

Survey data supported the fact that seller financing has become the norm.  Over 53 percent of brokers noted that more sellers are willing to offer seller financing in 2012 compared to 2011.

MSNBC’s – Applying for SBA Loans

The U.S. Small Business Administration doesn’t actually loan money directly to small companies, but it does back loans given by banks.  This allows the lender to take a little more risk than it might normally do.  To learn more, click here.

https://www.openforum.com/videos/wheres-the-money-applying-for-sba-loans?goback=%2Egde_1806481_member_161351166

TM Business Brokers, however, continue to get deals done!

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 – Americans Love Small Business

Pittsburgh | Raleigh Business Brokers – Americans Love Small Business

The following statistics support why we have so many buyers looking to purchase small and medium-size businesses.

Almost nine in 10 adults (88 percent) have a favorable view of small business, compared with the two-thirds (67 percent) who have a positive view of major companies, according to a telephone survey of 1,750 adults sponsored by the Public Affairs Council, a nonprofit group for public affairs officials.  More than half (53 percent) have a “very favorable” view of small business, in contrast to only 16 percent who hold the same view about major corporations.

Read more:

https://smallbusiness.foxbusiness.com/entrepreneurs/2012/08/20/why-americans-still-love-small-businesses/#ixzz25swlmvEK

https://obamawhitehouse.archives.gov/realitycheck/the-press-office/president-obama-announces-new-small-business-lending-initiatives

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 – “Why Waiting to Sell Your Business Might Backfire”

Pittsburgh | Raleigh Business Brokers – “Why Waiting to Sell Your Business Might Backfire”

The following Wall Street Journal article is a good supplement to our prior post today regarding “The Economy Stole My Retirement”.  This second article summarizes some reasons why a business owner may not want to wait sell a business.  Your decision to do so may very well backfire on you.

https://online.wsj.com/article/SB10000872396390444506004577618054291802614.html?mod=WSJ_SmallBusiness_LEADNewsCollection

This article also does not address the fact that many small businesses simply are not sellable in any market.  The sluggish economy may not be why a company will not sell.  You may have a business that will not sell in a good economy.

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 your retirement 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 – The Economy Stole My Retirement

Pittsburgh | Raleigh Business Brokers – “The Economy Stole My Retirement”

The following Wall Street Journal article summarizes some situations faced by many retirement aged business owners.  A large portion of their net worth is tied to the retirement nest egg in their business.  And, that net worth has declined over the past several years for many owners.

https://online.wsj.com/article_email/SB10000872396390444230504577615861593287688-lMyQjAxMTAyMDMwMDAzODA3Wj.html?mod=wsj_valetleft_email&goback=%2Egde_2907875_member_157100085

What the article does not address is the fact that many small businesses simply are not sellable in any market.  The sluggish economy may not be why a company will not sell.

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 advisor who does not sell companies for a living.  You may be delaying your retirement for the wrong reasons.

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

 

Wireless Business for Sale – $630,000 Cash Flow

Wireless Business for Sale – $630,000 Cash Flow

Presented by:  Pittsburgh | Raleigh Business Brokers – TM Business Brokers

Location : Pennsylvania

Seller Financing Available

Asking Price:  $1,900,000 
Gross Revenue:  $1,800,000

Business Description

Multi-location and well-established niche wireless related operation.  Solid management in place in all locations.  The business is experiencing very positive growth trends with continued growth potential of 100-200%.   Turn-key operation.  The seller will provide all necessary transitional support and training – flexible seller.  Reasonable proposals will be considered.  Contact Pittsburgh | Raleigh Business Brokers – TM Business Brokers today!

Health Insurance for Small Business

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:

11 comments to TM Business Brokers post

William BlackmonWilliam 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

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

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

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

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

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

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

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

Lauren Campbell

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

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

 

Landon Watts

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

Featured Business for Sale – $2,200,000 Cash Flow

Featured Business for Sale – $2,200,000 Cash Flow

Presented by:  Pittsburgh | Raleigh Business Brokers – TM Business Brokers

Growing Lead Generation Company : Mid-Atlantic, North East (Relocatable)

Seller Financing Available

Asking Price:  $5,900,000 
Gross Revenue:  $3,500,000

Business Description

Growing Mid-Atlantic based Lead Generation Company for Sale.  Full-service one-stop shop for all lead generation services.  Dynamic business model and extremely profitable.  Tremendous growth potential exists.  The business can be relocated to anywhere nationwide.  The seller will provide all necessary transitional support and training – flexible seller.  Reasonable proposals will be considered.  Contact Pittsburgh | Raleigh Business Brokers – TM Business Brokers today!

Pittsburgh | Raleigh Business Brokers – Buyer Profiles

Pittsburgh | Raleigh Business Brokers – Buyer Profiles

TM Business Brokers report a variety of business buyers are seeking small to medium sized companies.  Just as small business itself has become more sophisticated, the people interested in buying businesses have also become more divergent and complex.  The following are some of today’s most active categories of business buyers:

Family Members

Members of the seller’s own family form a traditional category of business buyer – a category of buyers that is “tried” but not always “true.”  There is something appealing about a family member taking over the business.  There is a sense of keeping the business in the family and an assumption that such an arrangement will translate into the prime advantage of continuity.  Continuity may in fact be the result as long as the family member buying the business treats the role as something akin to a hierarchical responsibility.  This can mean years of planning and diligent preparation, involving all or many members of the family in deciding who will be the “heir to the throne.”  If this has been done, the family member may be the best type of buyer.

Too often, however, the difficulty with the family member as buyer lies in the conflicts that may develop.  For example, does the family member have sufficient cash to purchase the business?  Can the selling family member really leave the business?  In too many cases, these and other conflicts result in serious disruption to the business itself and/or to the sales transaction, not to mention the impact on family relationships.  An outside buyer eliminates these often insoluble problems.

When considering a family member as a buyer, a business owner should carefully evaluate three factors: ability, family agreement, and financial worthiness.

Business Competitors

This is a category often overlooked as a source of prospective purchasers.  The obvious concern is that competitors will take advantage of the knowledge that the business is for sale by attempting to lure away customers or clients.  However, if the business is compatible, a competitor may be willing to “pay the price” to acquire a ready-made means to expand.  A business brokerage professional can be of tremendous assistance in dealing with the competitor.  They will use confidentiality agreements and will reveal the name of the business only after contacting the seller and qualifying the competitor.

The Foreign Buyer

Many foreigners arrive in the United States with ample funds and a great desire to share in the American Dream.  Many also have difficulty obtaining jobs in their previous professions, because of language barriers, licensing, and specific experience.  As owners of their own businesses, at least some of these problems can be short-circuited.

These buyers work hard and long and usually are very successful small business owners.  However, their business acumen does not necessarily coincide with that of the seller (as would be the case with any inexperienced owner).  Again, a business broker professional knows best how to approach these potential problems.

Synergistic Buyers

These are buyers who feel that a particular business would compliment their business and that combining the two would result in lower costs, new customers, and other advantages.  Synergistic buyers are more likely to pay more than other types of buyers, because they can see the results of the purchase.  Synergistic buyers seldom look at the small business, but they may find many mid-sized companies that meet their requirements.

Financial Buyers

This category of buyer comes with perhaps the longest list of criteria and demands.  These buyers want maximum leverage, but they also are the right category for the seller who wants to continue to manage his company after it is sold.  Most financial buyers offer a lower purchase price than other types, but they do often make provision for what may be important to the seller other than the money—such as selection of key employees, location, and other issues.

For a business to be of interest to a financial buyer, the profits must be sufficient not only to support existing management, but also to provide a return to the owner.

Individual Buyer

When it comes time to sell, most owners of the small to mid-sized business gravitate toward this category of buyer.  Many of these buyers are mature (aged 40 to 60) and have been well-seasoned in the corporate marketplace.  Owning a business is a dream of theirs, and one many of them can well afford.  The key to approaching this kind of buyer is to find out what it is they are really looking for.

The buyer who needs to replace a job can be an excellent prospect.  Although owning a business is more than just a job, and the risks involved can frighten this kind of buyer, the buyer without a current job will have the “hunger” necessary to take the leap.  A further advantage is that this category of buyer comes with fewer complications than many of the other types.

A Final Note

Your Pittsburgh | Raleigh Business Brokers – TM Business Brokers has the experience needed to sort out the “right” type of buyer.

Building a Sellable Service Business – Pittsburgh | Raleigh Brokers

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.

Pittsburgh | Raleigh Business Brokers – Why Sell?

Pittsburgh | Raleigh Business Brokers – Why Sell?

Selling a business is an emotional process for many reasons.  The owner’s family may have owned the business for several generations.  The business owner may have started the company and spent a lot of years, sweat and tears building it into a successful, profitable business.  Accordingly, “seller’s remorse” is often a major reason for transactions to terminate.  None-the-less, there are reasons why selling makes sense or is the best avenue for the business owner.  Your Pittsburgh | Raleigh Business Brokers cites some examples:

Burnout

According to industry experts, burnout is a major reason owners consider selling their businesses.  Over time, the long hours and 7-day work weeks can take their toll.  On the opposite end, business owners who thrive on challenge may get to the point that the business has just become boring – the challenge of creating it or growing it has been replaced with the mundane daily activities of running it.  Losing interest in one’s business usually indicates that it is time to sell.

No succession option

Sons and daughters may be disenchanted with the family business by the time it’s their turn to take over.  They may have their own dreams to fulfill that do not include the family business.

Unexpected circumstances

This is the number one reason a business owner should make plans about selling even if he or she is not planning to sell for many years.  A good question for a business owner to ask is, “If an unexpected circumstance should occur tomorrow that would require me to sell my business, what would I wish I had already done?”  Unexpected events include such things as accidents, illness of owner or family members, divorce, and partnership issues.  Unfortunately, these events are seldom predicted, and too many times, a forced sale does not bring maximum value.

Need to cash out

The need to cash out may be caused by an unexpected circumstance, such as a costly accident or illness.  Many company owners have much of their personal net worth invested in their business.  This can present a lack of liquidity.  In such situations, an owner in need of additional cash has two options: borrowing against the assets of the business or selling the business.

Outside pressure

Successful businesses create competition.  There are times when a business owner discovers that the competition has built to the point where it is easier to join it than to fight it.

An “out of the blue” offer

There are times when a business may not even be on the market, but someone or some other company sees an opportunity and makes an unexpected offer.  This may be a great time to sell as the owner is likely entering the negotiations from a position of strength.

There are obviously many other reasons why businesses are sold.  The most important factor is that the owner is convinced that it is time to sell and has a clear understanding of his or her reasons.  And, whether that time is now or many years in the future, the wise owner will consider the following: “The time to prepare to sell is the day you start or take over the business.”

Call your Pittsburgh | Raleigh Business Brokers – TM Business Brokers to confidentially discuss your unique situation today!

Exclusive Webinar – Building a Sellable Business

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

Protect your Business Value – Raleigh | Pittsburgh

Protect your Business Value – Raleigh | Pittsburgh Business Brokers

Warren Buffett famously invests in businesses that have what he calls a protective “moat” around them – one that inoculates them from competition and allows them to control their pricing.

Big companies lock out their competitors by out-slugging them in capital infrastructure investments, but smaller businesses have to be smarter about how they defend their turf. Here are four ways to deepen and widen the protective moat around your business:

Get certified

Is there a certification program that you could take to differentiate your business? A Canadian company that disposes of radioactive waste decided to get licensed by the Canadian Nuclear Safety Commission.  It was a lot of paperwork and training, but the certification process acts as a barrier against other people jumping into the market and competing.

Is there a certification you could get that would make it more difficult for others to compete with you?

Create an army of defenders

Ecstatic customers act as defenders against other competitors entering your market, a factor that has enabled companies like Trader Joe’s to defend their market share in the bourgeois bohemian (bobo) market, despite a crowded market of stores hawking groceries.

Get your customers to integrate

Is there a way you can get your customers to integrate your product or service into their operations?

The basic switching costs of Customer Relationship Management (CRM) software are virtually nil.  Everyone from 37signals to Salesforce.com will give you a free trial to test their wares.

The real expenses associated with changing CRM software only come when a business starts to customize the software and integrate it into the way they work. Once a sales manager has trained his salespeople in creating a weekly sales funnel in a CRM platform, try to convince him to switch.

Can you offer your customers training in how to use what you sell to make your company stickier?

Become a verb

Think back to the last time you looked for a recipe. You probably “googled” it.  Part of Google’s competitive shield is that the company name has become a verb. Now every time someone refers to searching for something online, it reinforces the competitive position of a single company.

Is there a way you could control the vocabulary people use to refer to your category or specialty?

Widening your protective moat triggers a virtuous cycle: differentiation leads to having control over your pricing, which allows for healthier margins, which in turn lead to greater profitability and the cash to further differentiate your offering.

If you’re wondering how differentiated your businesses is, take the 13-minute Sellability Score questionnaire and find out….

THE SELLABILITY SCORE

Please contact your Raleigh | Pittsburgh Business Brokers – TM Business Brokers if you have any questions regarding The Sellability Score.

What’s Your Sellability Score – Pittsburgh Business Brokers

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

The Sellability Score Software uses an advanced algorithm that weighs dozens of different variables to determine how easy it would be to sell your business.
Once you know where you stand, you can start taking the appropriate steps toward actually selling your business and walking away with the fat nest egg you’ve been dreaming about.
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

Please contact your Raleigh | Pittsburgh Business Brokers – TM Business Brokers if you have any questions regarding The Sellability Score.

Pittsburgh | Raleigh Business Brokers – What is a Term Sheet?

Pittsburgh | Raleigh Business Brokers – What is a Term Sheet?

Buyers, sellers, intermediaries and advisors often  use  a term sheet prior to the creation of a formal, legally binding purchase and sale agreement.  However, very rarely do you ever hear this document explained.  It sounds good but what is it specifically?

Very few books about the M&A process even mention term sheet.  It is typically a one page document that states the sale price along with the  deal structure and whether or not it includes the real estate.”  Attorney and author Jean Sifleet offers this explanation:  “A one page ‘term sheet’ answering the questions:  Who? What? Where? and How Much? helps focus the negotiations on what’s important to the parties.  Lawyers, accountants and other advisors can then review the term sheet and discuss the issues.”  She cautions, “Be wary of professional advisors who use lots of boilerplate documents, take extreme positions or use tactics that are adversarial.  Strive always to keep the negotiations ‘win-win.'”

If the buyer and the seller have verbally agreed on the price and terms, then putting words on paper can be a good idea.  This allows the parties to see what has been agreed on, at least verbally.  This step can lead to the more formalized letter of intent based on the information contained in the term sheet.  The term sheet allows the parties and their advisors to put something on paper that has been verbally discussed and tentatively agreed on prior to any documentation that requires signatures and legal review.

A term sheet is, in essence, a preliminary proposal containing the outline of the price, terms and any major considerations such as employment agreements, consulting agreements and covenants not to compete.  It is the initial step to putting a deal together.

Pittsburgh Business Brokers – Ten Steps for Sellers

Pittsburgh Business Brokers – Ten Steps for Sellers
 

1. Place a reasonable price on your business.  Since an inflated figure either turns off or slows down potential buyers, rely on your Pittsburgh business brokers – TM Business Brokers to help you arrive at the best “win-win” price.

2. 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.

3. Engage experts to insure confidentiality.  A breach of confidentiality surrounding the sale of a business can change the course of the transaction.  Pittsburgh Business Brokers – TMBB can channel the process and the parties involved to keep the sale within safely silent bounds.

4. 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.

5. Anticipating information the buyer may request.  In order to obtain financing, the buyer will need appraisals on all assets as well as information to satisfy environmental regulations.

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

7. Be flexible.  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 professional business broker to keep the deal sweet instead of sour.

8. 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 broker’s help, decide ahead of time when “to hold” and when “to fold.”

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

10. Be willing to stay 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 TM Business Brokers to determine how you can best effect a smooth transition.

Pittsburgh Business Brokers – Mistakes Sellers Make

Pittsburgh Business Brokers – Mistakes Sellers Make
 

• Business owners neglect to run their business during the sales process. – The owner of a business with sales under the $20 million range can get so involved in the selling process that they neglect the day-to-day operation of the business.

• Business owners don’t understand the “real” value of their business. – A business may actually command a higher price than the value determined by an appraiser.  The business may be worth more than the sum of its parts.  Pittsburgh Business Brokers – TM Business Brokers can answer the question of real value and help determine a “go-to-market” price.

• Business owners aren’t flexible in structuring the transaction. – In many cases, how the deal is structured is more important than the price or terms.

• Business owners are not looking at the business from a buyer’s perspective. – Buyers may look for different aspects of a business than those the seller looks for.  For example: growth potential, management depth, customer base, etc.

• Business owners start with too high a price. – Sellers obviously want to maximize the price they receive for their business, but today’s marketplace is difficult to fool.  A good buyer may just elect to pass because of an overly aggressive starting point.

• Business owners are impatient. – Sellers have to understand that it can take 6 to 18 months to find a buyer and proceed through the sales process, which includes due diligence, the legal and accounting issues that must be handled, and ultimately the closing.  However, on the flip side, the longer the deal drags, the more likely it is to fall apart.  As the saying goes: Time is of the essence!

• Business owners have insufficient or inadequate documentation. – Sellers should have current real estate and equipment appraisals at the ready along with any documentation a buyer might want, such as projections, business forecasts and plans, and environmental studies.  Having all the documentation and financial records readily available will not only speed things along, but might also provide for a higher price or, even more important, save the deal.

Business Brokers in Raleigh Expansion

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.

Pittsburgh Business Brokers – New Hire

Pittsburgh Business Brokers – New Hire

TM Business Brokers, LLC announces the recent hiring of Jim Livingstone.  With Jim joining our team of Pittsburgh Business Brokers, he brings over 25 years of business experience working with small to mid-sized companies, both as an advisor and as an owner.

He has extensive experience in accounting, tax, business valuation and due diligence.  Jim has worked in a variety of industries, including retail, distribution, manufacturing, consumer products and service-oriented businesses.

Jim is a graduate of Syracuse University.  He is a CPA and has also attained the Accredited in Business Valuation designation issued by the AICPA.

We are excited to have Jim on our Pittsburgh Business Brokers team!

Sell a Business – Tasks to Do

Sell a Business – Tasks to Do

Before you sell a business or decide to go to market, owners should consider completing the following items:

  • Remove any items not included in the sale of the business.  That family heirloom portrait behind the counter of Grandfather Smith, founder of the business, should be removed.
  • Remove or repair any non-functioning equipment.
  • Prepare an operations manual to show a new owner all the functions of the business, how things are done, the major customers and suppliers, samples of advertising, and any other information that would help a new owner manage and operate the business.
  • Take care of any outstanding bills and resolve any legal, tax, or governmental issues.
  • Bring your financial statements up to date, and have your accounting professional prepare them for a buyer’s inspection.
  • Clean up the business inside and out.  Fill the shelves, clean up the inventory, and paint the interior if necessary.

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 Pittsburgh Business Brokers – TM Business Brokers can assist in all facets of preparation.  We know what buyers are looking for and are also familiar with current market conditions.

Pittsburgh Business for Sale – Buyers Look For?

Pittsburgh Business for Sale – Buyers Look For?
 

Your Pittsburgh business for sale is just what the buyer has been looking for.  The buyer has reviewed your financial statements and has made an offer contingent on several items.  You’ve reviewed the offer and it looks fine, so what’s next?  The contingencies in the deal mean that the buyer or his or her advisors have some concerns.  In larger deals, this process might be called due diligence.  However, in the smaller Pittsburgh business for sale scenario, the items of concern are usually spelled out as opposed to a general review of everything.  The reason for this is that larger companies have a lot more areas of concern than the typical smaller Pittsburgh business for sale.

Most contingencies concern the review of financial statements and/or business tax returns.  Others may involve lease issues, the seller staying on for a set period of time, or some very specific issue such as repaving the parking lot, if the landlord will not or is not required to.

Unfortunately, some contingencies may be hiding other ones such as a list of fixtures and equipment included in the sale.  Sounds easy on the surface, but the seller forgot that two pieces of equipment currently not in use need repair or the walnut desk in the office belongs to their Grandfather and is not included.  Or, while reviewing the lease, the buyer discovers that the landlord requires that the business must close by 6:00 PM or some other restriction applies and was not disclosed.  Deals have fallen apart over similar issues.

Most contingency problems can be resolved prior to the business being placed on the market.  The seller should do all of the following:

•    Check the status of all furniture, fixtures and equipment (FF&E).  Remove any FF&E that are not included in the sale or not in use –  or make repairs.

•    Review all contracts such as the building lease and equipment leases that will be assumed by the buyer.  Make sure there aren’t “problems” in them.  If there are, disclose them to a potential buyer out front – and be sure your Pittsburgh Business Brokers – TM Business Brokers are also aware of them.

•    Be prepared to answer questions such as:

– Are there any environmental, governmental or legal issues?
– How long will you be willing to stay and work with a new buyer – at no cost?
– Will the employees stay?
– Why was last year the worst one in years?
– Why was last year the best one in years?

The list can go on and on, but sellers need to be ready.  Buyers don’t like surprises.  Pittsburgh Business Brokers – TM Business Brokers know the process like a book.  We can be invaluable in preparing the business for the marketplace.

Pittsburgh Business Brokers – Why use Us?

Why use Pittsburgh Business Brokers – TM Business Brokers?

When you make the decision to sell your business, you are taking a giant step that involves the emotions as well as the marketplace, each with its own set of complexities.  Those sellers who are tempted to undertake the sale of a business on their own should understand both the process and the emotional environment that this process is set against.  The steps outlined below are just some of the items for a successful sale.  While these might seem daunting to the do-it-yourself business owner, by engaging the help of the Pittsburgh Business Brokers – TM business brokers, the seller can feel confident about what is often one of the major decisions of a lifetime.

1.  Set the stage.
What kind of impression will the business make on prospective buyers?  The seller may be happy with a weathered sign (the rustic look) or weeds poking up through the pavement (the natural look), but the buyer might only think, “What a mess!”  Equally problematic can be improvements planned by the seller that appeal to his or her sense of aesthetics but that will, in fact, do nothing to benefit the sale.  Instead of guessing what might make a difference and what might not, sellers would be wise to seek the advice of Pittsburgh Business Brokers – TM Business Brokers – professionals with experience in dealing regularly with buyers and with an eye experienced in properly setting the business scene.

2.  Get the records straight.
Although outward appearance does count, what’s inside the books is even more important.  Ultimately, a business will sell according to the numbers. TM Business Brokers can offer the seller invaluable assistance in the presentation of the financials.

3.  Weigh price against value.
All sellers naturally want to get the best possible price for their business.  However, they also need to be realistic.  To determine the best price, TM Business Brokers will use industry-tested pricing techniques that include ratios based on sales of similar businesses, as well as historical data on the type of business for sale.

4.  Market professionally.
Engaging the services TM Business Brokers is the key to the successful sale of a business.  We will prepare a marketing strategy and offer advice about essential marketing tools–everything from a business description to media advertising.  Through our professional networks and access to data on prospective buyers, we get the word out about the business far more effectively than any owner could manage on an individual basis.

Sell My Business – Am I Serious?

Sell my business – am I serious?

There are three good questions to consider before selling your business.

First, “Do I really want to sell my business?”  If you’re really serious about selling your business and have a solid reason (or reasons) why you want to sell, it will most likely happen.

Second, “Do I have reasonable expectations?”  You increase your chances of selling if you can answer “yes” to this second question.  This includes your expectations about the selling price, the time it will take to sell your business, and the amount of seller financing you are willing to offer.

Third, “What will I do once I sell my business?”  The time to consider this is before you place your business on the market.  This may seem obvious, but many transactions fall through because the business owner did not consider what he or she would do once the business was sold.

A “yes” answer to the first two questions plus having an answer to the third question (other than “I don’t know”) means you are serious about selling.

Sale of a Business in Pittsburgh – Now a Good Time?

Timing is everything.  Are you considering the sale of a business in Pittsburgh?  We have  pent up demand of buyers seeking businesses for sale in Pittsburgh!

Tips for a fast sale of a business in Pittsburgh

  • Have up-to-date financial information available
  • Prepare a current list of fixtures & equipment
  • Maintain normal business hours
  • Spiff up the business
  • Set a realistic price
  • Be willing to negotiate
  • Gather all of the information a buyer might like to review

Here are two major ways to increase the odds of a successful sale of a business in Pittsburgh:

  • Make sure that you are serious before you put your business up for sale.  You should be willing to accept, within reason, what the marketplace is willing to pay.  It’s not what you want for your business, or what your accountant says it’s worth – it’s what a buyer is willing to pay.  Find out if the price you are asking is in the “ballpark” before you go to market.  TM Business Brokers is a good place to start.  We can tell you what you might expect to receive if you sell now.
  • Be willing to finance a portion of the sale of a business.  Counting on the business selling for all cash or assuming that the business can be financed will most likely make your business one of the four that doesn’t sell.  By showing your willingness to assist in the financing, you reassure the buyer that you have confidence in the businesses’ ability to finance itself.  Also, keep in mind that by helping in financing the business you will be entitled to interest on the balance, thereby increasing the price you will receive.

The Perfect Business

The “perfect business”, the one that would be sure to sell, has the following attributes:

  • a reasonable price
  • a reasonable down payment
  • seller financing
  • reasonable sales (hopefully steady or increasing each year)
  • a compelling reason for sale
  • a desired or popular industry type
  • attractive and strategic location (if important for business type)

Following these guidelines and tips might not sell your business, but it will certainly increase the odds.  Almost any business will sell under the right circumstances.  If you are serious about selling, the first step should be to call TM Business Brokers.  We can answer your questions about the selling process and what it takes to sell your business in today’s economic climate.