Prep Your Business In Order To Get Your Asking Price

While most home owners take the time and money to prepare a house to be marketed and sold, few business owners adequately prep their business when selling it. Business owners should attempt to look at their business through the eyes of a potential buyer. The business broker will make that perspective the focus of the business owner in valuing and preparing the business for sale.

This article is one that could serve as a guide to those considering selling their business, and provides critical insights to enable the seller to receive the best price for their business.

Read: Getting a good price for your business: How to prep your company for sale 

For a complimentary consultation:
Contact  Cecil Williams (cecil@bizbrokerflorida.com) or call  at 888-925-5055 ext.206.  Visit my personal website to search for business for sale in Florida www.bizbrokerflorida.com  Also, visit our Florida Business Exchange website at www.fbxbrokers.com

How To Get Your Asking Price When Selling Your Business

Most people don’t realize that for most business owners that is seldom a successors to continue their business when they decide it’s time for them to quit. That fact makes selling a business the most viable exit strategy for business owners.  Selling the business allows the business owner to achieve converting the business into liquid assets and getting a return of their investment of time and money.

Whatever the reason for selling, following these tips for selling a business will help ensure that you get the best price and that your business sells.

1) Sell at the right time for the right reasons.

The number one reason for selling a business is that a business owner falls ill or gets too old to continue to run it – that is the worst time to be selling a business. This situation creates two tremendous issues; 1) it's going to be extremely difficult to deal with the additional stress of selling a business in those circumstances and 2) the buyer will use your circumstances as leverage against you.

Don't wait too long to sell. The best time to sell is when business is good. Don't wait until poor health, divorce, or a downturn occurs" to sell your business. Look to sell from a strong position, on terms you can determine. 

2) Be clear about what you're selling.

Most business transfer transactions are asset sales. So, before selling a business consider what all the assets are (tangible and intangible), and decide what you are selling. Determine what physical (tangible) assets you are selling and what other assets (intangible) you have to sell. Selling a business often includes assets such as goodwill, trademarks or client lists as well as physical  

3) Determine what your business is actually worth.

Your business is worth as much as a buyer is willing to pay in the marketplace. However, determining the initial asking price is critical. There are several business valuation approaches ranging from asset-based to future earnings approaches. No one approach can be used in isolation; the current market, economic trends and what other similar businesses have sold for also need to be taken into account.

Ensuring that a professional valuation is done should be among the first step in selling a business.

4) Make sure your house is in order.

Keep good records and have them prepared for your broker and prospective buyers. Keeping the business's records up to date, the inventory up and the premises maintained are crucial. Good financial records and other business documentation can help expedite the buyer’s due diligence process and increase the chances of a victorious and lucrative sale.

Run the business as usual or better. It is critical that your business maintains the level of operation as usual and continues to produce the financial results shown in the business profile during the selling process. It is imperative that your business maintains the level of operation as usual and continues to produce the financial results shown in the business profile. If your performance slips, it will turn up during Due Diligence and either kill the deal or affect your selling price.

One Last Tip for Selling a Business

Selling a business is the most complex business transaction most people will ever experience. Therefore have professional assistance is key to ensuring the best outcome. Use a professional Business Broker to sell your business. Your business Broker should belong to a professional organization such as the IBBA (International Business Brokers Association and in Florida, Business Broker of Florida (BBF). These organizations have established professional ethics and rules for their members in addition to training for members to make certain they are knowledgeable, competent, and abide by the highest professional ethics.

Any business owner who has sold a business on his of her own will tell you it’s a long, tedious and stressful process.  It consumes time and distracts you from the day to day operation of the business.  When your focus should be on maintaining or increasing the value of your business, all of your time and energy is directed to the sale process.

That’s where an experienced business broker can pay huge dividends.  An experience business broker can help guide you through the complicated process of selling your business. While you focus on continuing to operate your business, your broker will assist with determining the asking price, executing a marketing plan, qualifying buyers, preparing offers, negotiations, and completing the entire transaction to a successful close.

For a complimentary consultation:
Contact  Cecil Williams (cecil@bizbrokerflorida.com) or call  at 888-925-5055 ext.206.  Visit my personal website to search for business for sale in Florida www.bizbrokerflorida.com  Also, visit our Florida Business Exchange website at www.fbxbrokers.com

How Long Does It Take To Sell Your Business?

The title and content touches on one key point:  the clock starts only when the business is adequately prepared and
priced for sale.

How Long Does It Take To Sell Your Business? | GlobalBX Entrepreneur Business Blog

For a complimentary consultation:
Contact Cecil Williams (cecil@bizbrokerflorida.com) or call  at 888-925-5055 ext.206.  Visit my personal website to search for business for sale in Florida www.bizbrokerflorida.com  Also, visit our Florida Business Exchange website at www.fbxbrokers.com

10 Questions to Ask Before Buying a Business

10 Questions to Ask Before Buying a Business

10 Questions to Ask Before Buying a Business Inc.com, Page 2

Another great article from Inc.com. Make sure you have the personal questions answered prior to your pursuit of a business!

For a complimentary consultation:
Contact Cecil Williams (cecil@bizbrokerflorida.com) or call  at 888-925-5055 ext.206.  Visit my personal website to search for business for sale in Florida  www.bizbrokerflorida.com Also, visit our Florida Business Exchange website at www.fbxbrokers.com

When You're Ready to Sell the Business | Reuters

When You're Ready to Sell the Business | Reuters

Excellent summary of actions to take now if you are thinking of selling your business in the near future. It is never too soon to prepare, but it can be too late.

When You're Ready to Sell the Business | Reuters

For a complimentary consultation:
Contact Cecil Williams (cecil@bizbrokerflorida.com) or call  at 888-925-5055 ext.206.  Visit my personal website to search for business for sale in Florida www.bizbrokerflorida.com  Also, visit our Florida Business Exchange website at www.fbxbrokers.com

Selling a Restaurant- What's Important to the Buyer

 What factors are most important for buyers of restuarants?

Profitability
One of the first questions a prospective buyer will need answered is whether or not the restaurant is profitable.
Cleanliness
Cleanliness is definitely next to godliness when it comes to selling a restaurant. 
Staffing
Prospective buyers will be interested in talking to your restaurant's staff.
Reputation
You can be guaranteed that prospective buyers are going to ask around for information about the restaurant's reputation before they commit to anything.
Licenses
Finally, prospective buyers will want to know that the restaurant currently meets all applicable health codes and is current on all its licenses - including the liquor license - if he plans to serve alcoholic beverages.

This article covers this factors in greater detail, and I encourage your review and feedback. Also be mindful that my company has sold over 200 restaurants in the state of Florida over the last seven years.

Selling a Restaurant - What's Important To The Buyer

For a complimentary consultation

Contact Cecil Williams

 For more information call me at 888-925-5055 ext.206

 Visit my website to search for business for sale in Florida

www.bizbrokerflorida.com

How You Feel Might Kill the Deal

This article mentions a business owner that didn't truly commit to selling his business until the buyer sat across from him at the closing table. I have even seem sellers who found is difficult to turn over the keys to the business after the closing!

Yes, selling one's business is extremely emotional and must be prepared for. I recently had a 45 year old  pest control operator that couldn't answer the question of what he would do after selling his business. I told him he wasn't ready to sell his business. But, he was ready to continue growing his business by buying a few smaller operators, and we are currently working together.

This article offers excellent insights regarding of the industry and is well worth reading for those preparing to sell their business.

How You Feel Might Kill the Deal 

For a complimentary consultation

Contact Cecil Williams

 For more information call me at 888-925-5055 ext.206

 Visit my website to search for business for sale in Florida

www.bizbrokerflorida.com

How to prepare to sell a business » Corpus Christi Caller-Times

Good information is the attached article, but check out my earlier post, Best Advice for Selling Your Business.html, for more insights as you prepare your business to be sold.

How to prepare to sell a business

For a complimentary consultation

Contact Cecil Williams

 For more information call me at 888-925-5055 ext.206

 Visit my website to search for business for sale in Florida

www.bizbrokerflorida.com

Buying a Business – Asset or Stock Purchase? — Illinois Tax Attorney

When making the decision to purchase an existing business,  the buyer must determine whether he or she is going to seek to purchase the assets of the business, or the stock of the business entity.  An asset purchase involves the purchase of the selling company's assets -- including facilities, vehicles, equipment, and stock or inventory.  A stock purchase involves the purchase of the selling company's stock only.

A business broker, attorney, and CPA can advise a prospective buyer on the advantages and disadvantages of these alternatives, but the final decision is the buyer's. This article offers a few insights into that decision.

Buying a Business – Asset or Stock Purchase? 

For a complimentary consultation

Contact Cecil Williams

 For more information call me at 888-925-5055 ext.206

 

 Visit my website to search for business for sale in Florida

www.bizbrokerflorida.com

How to Buy a Business Without Losing Your Shirt | The Labor Academy

Yes, buying a business is a risky proposition. But, planning and utilizing experience advisors will minimize that risk. I did an earlier post, Entrepreneurship by Acquisition (Entrepreneurship-by-Acquisition.html), that covers all the points highlighted in the attached article and encourage you to also review it.

How to Buy a Business Without Losing Your Shirt | The Labor Academy

 

For a complimentary consultation

Contact Cecil Williams

 For more information call me at 888-925-5055 ext.206

 

 Visit my website to search for business for sale in Florida

www.bizbrokerflorida.com

Getting a good price for your business: How to prep your company for sale and calculate its value | BedTimes

While most home owners take the time and money to prepare a house to be marketed and sold, few business owners adequately prep their business when selling it. Business owners should attempt to look at their business through the eyes of a potential buyer. The business broker will make that perspective the focus of the business owner in valuing and preparing the business for sale.

This article is one that could serve as a guide to those considering selling their business, and provides critical insights to enable the seller to receive the best price for their business.

Getting a good price for your business: How to prep your company for sale 

For a complimentary consultation

Contact Cecil Williams

 For more information call me at 888-925-5055 ext.206

 Visit my website to search for business for sale in Florida

www.bizbrokerflorida.com

Selling Your Business

Are business selling?  Businesses sold year-to-date are up 1.2% as compared to 201. This article not only gives insight to what's occurring in Florida, but also other states.

Selling Your Business

For a complimentary consultation

Contact Cecil Williams

 For more information call me at 888-925-5055 ext.206

 Visit my website to search for business for sale in Florida

www.bizbrokerflorida.com

What to know when you’re selling your business - Business

This is an excellent article and covers many of the items I elaborated on in previous posts.
What to know when you’re selling your business - Business - MiamiHerald.com

For a complimentary consultation

Contact Cecil Williams

 For more information call me at 888-925-5055 ext.206

 Visit my website to search for business for sale in Florida

www.bizbrokerflorida.com

The Most Critical Question A Buyer Must Ask

Being able to determine the validity of a seller’s answer to the question why a business is for sale is crucial to a buyer’s return on their investment of capital and time in the transaction.

Whatever answers the seller provides to this key question, a buyer should continually validate that answer with direct and indirect probing questions during interactions with the seller, until a complete comfort level is reached.

Here are some of the most common reasons business owners sell their businesses, and some of these are never honestly disclosed to the buyer. Remember, it’s the buyer's responsible to ensure an understanding of the “why” question, whether disclosed or not by the seller.

• Retirement
• Need funds to finance another venture
• Tension between management and/or staff
• Sick of dealing with bureaucracy
• Not generating enough income 
• In anticipation of impending changes likely to make the industry more challenging (e.g., exiting DVD rental sector might have been shrewd move in recent years as online download market accelerated)
• Economic downturn
• Fulfillment of a long-term exit; hit profit and revenue targets 
• Ideal juncture in the economic cycle
• Perception that business is at its peak; value will never be higher

 

For a complimentary consultation

Contact Cecil Williams

 For more information call me at 888-925-5055 ext.206

 

 Visit my website to search for business for sale in Florida

www.bizbrokerflorida.com

 

Entrepreneurship by Acquisition …..Planning Your Search

Part 1 – Develop your criteria to utilizing in evaluating acquisition targets

Contrary to what most people believe, being an entrepreneur is not just about making money, and is it not purely about starting, owning, and running a small business to create value — it is a way of life and alternative to the model of go-to-school, get-good-grades, and get-a-good-job.   Entrepreneurship has historically been defined as a process through which individuals identify opportunities, allocate resources, and create value.  This creation of value is often through the identification of unmet needs or through the identification of opportunities for change. But in this current economic with a dramatic decrease in consumer spending, tight lending (or access to capital), budding entrepreneurs will (or should) seek success by identifying opportunities for change with existing businesses.

The current crop of new entrepreneurs, many because of the dismal job market, will become an entrepreneur by buying a business, managing that business, growing it, and they view this as a career decision in lieu of (or better than) working for someone else.

Buying a business has always offered advantages over starting one for seasoned professionals, but currently those advantages or even greater. Some of those advantages are

• Proven concept, business model, products or services in place
• Cash flow (and hopefully recurring revenue) from day one
• An existing customer base, contracts and, vendor relationships  
• Existing staff and management
• Transition of knowledge from the seller (current owner) allows the buyer to learn about running the business, which helps in gaining an insight about their experiences and also the expertise needed to keep the business competitive.
• Brand or reputation - existing goodwill is associated with the product/service, name and location.
• Lenders or financiers are more willing to lend money to an existing business with a track record.

If you’ve bitten by the entrepreneurial bug, you can either start a business from scratch or buy an existing operation. However the risks associated with starting a business from scratch, which has always been great, are much more frightening during economic times like we’re now experiencing.

Developing Your Criteria

Your first step in the buying process should be clearly defining the criteria you will use to select a business. Write out these criteria, continually refine it, and use it the screen businesses during your search. This will guide your search process, save you time, and ensure you’re using an objective approach (non-emotional) in your search process. Your criteria can be developed by answers some questions concerning you and what you want in a business:

·         When do you want buying the business?

o   Remember if this is a goal is needs to be time specific

·         Why are you buying a business?

o   Do you plan to manage the business?

o   Do you just want to be an investor?

o   Are you buying a job or lifestyle?

·         What factors about a business or industry are most important to you?

·         How much revenue should the business be producing?

·         How large of a company do you want to run?

·         How important is the growth potential of the company or industry?

o   How large of a market area and market potential is desired

·         What is your price range for buying a business?

o   Complete a financial statement on yourself, determine how liquid you are, identify your sources of capital, and determine if you can leverage other sources of capital?

·         Determine what industries you’re interested in and also indicate those you will not pursue.

o   You should first assess your background, skills, interests, and education.

Answering these questions will result in a well defined criterion to utilize in screening opportunity during your search.

Following is an example of a well thought out criteria that a buyer actually used in a search and also used it as a mailing to business brokers and small equity funds:

 

Joe Doe                                                        1234 Anywhere Court Somewhere, Florida 33333 407-666-5555 I am focusing on identifying and acquiring a company in a mature, preferably fragmented, non-cyclical industry.  It is my goal to acquire in the 2008-2009 timeframe and run the company on a full-time basis. The types of themes that I seek to evaluate include: ·         Scalable businesses ·         Recurring revenue, long-term contracts, and/or stable customer bases ·         Sustainable profit margins ·         Historical and sustainable high margin cash flow, with minimal cyclicality ·         Businesses with distinctive market positions/competencies ·         Ability to grow strong franchises, unique distribution, or media brands I am interested in evaluating profitable and growing privately held companies that are currently being marketed, those with ownership expecting to retire in the next twelve months (i.e., undergoing generational changes of ownership), and any companies meeting my acquisition criteria that would be receptive to an unsolicited offer to buy.  Although I do not seek severely distressed opportunities, I will consider under-performing companies with identifiable asset such as: ·         An excellent product line or service ·         Technology enabled ·         Sound distribution network and customer base ·         Manufacturing know-how ·         Skilled workforce ·         Licenses, patents, or distribution agreements While the current revenue of a company is not the only investment consideration, the ideal target would generate revenues between $1 million and $5 million serving an existing market in excess of $100 million.  EBITDA margins between 8% - 10% and market/industry growth should exceed 10%. Existing management should expect to stay in place and can anticipate intermediate transition terms with possible incentive based compensation programs.   Pre-transaction valuation range (enterprise) will be between $1 million and $5 million and the target should have assets available for financing. I am focusing on companies in the following industries: ·         Marketing Services ·         Insurance Services ·         Business Services ·         Logistics and facilities management ·         Distribution, and Light Manufacturing Industries or companies that I will not consider include high technology, telecommunications, broadcast media, real estate, restaurants, and convenience stores.  We also will not consider start-ups, franchises, or early stage ventures. I will only consider opportunities in Southeast United States.  However, I am specifically interested in opportunities in the state of Florida. I target my solicitation on business brokers/appraisers, bankers, accounting firms, estate planners, financial advisors, and a variety of other sources and may consider paying intermediary or finder fees. I am offering an excellent opportunity for those business owners or investors who seek exit or liquidity strategies. John B. Doe, MBA (Bio attached) Advisors: Jane Jones, Attorney, P.A. 132 Sands Avenue Beach Life, Florida 33715                                      John Smith, CPA John Smith & Company 111 Circle North Sailing, Florida 33716

Whether working with me to buy a business in Florida, or leveraging the skills of another professional, putting time in to developing an evaluation criterion should be a buyer’s initial step in their acquisition process.

For a complimentary consultation

Contact Cecil Williams

 For more information call me at 888-925-5055 ext.206

 

 Visit my website to search for business for sale in Florida

www.bizbrokerflorida.com