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“Independent Business Owner” is a phrase with two meanings. Of course, it means being the owner of an independent business. But another way to look at “Independent Business Owner” is to let this phrase define the very personality of the person at the helm. Independent, Confident, Self-Assured, Strong-Willed. These are vital entrepreneurial attributes, but, ironically, they can sometimes work against the business owner when it comes time to sell. Since business owners are the type who know about selling — either products or services– and about making deals — haven’t they had to cope with suppliers, customers, and competitors throughout their business careers? — it’s not surprising that owners approach selling their businesses with these tried-and-true tactics and ideas. Sellers who have spent years building a business are often unaware of how completely different the process of selling a business can be. Savvy sellers, realizing the importance of a selling approach equal to this … [Read more...]

Every company has weaknesses; the trick is to fix them. There is a saying that the test of a good company president or CEO is what happens to the company when he or she leaves. Some companies–on paper–may look the same, but one company may be much more valuable due to weaknesses in the other company. Not all problems or weaknesses can be resolved or fixed, but most can be mitigated. Fixing or lessening company weaknesses can not only significantly improve the value, but also increase the chances of finding the right buyer. Here are some common weaknesses that concern some buyers, causing them to look elsewhere for an acquisition. “The One Man Band” Many small companies were founded by the current president, and he has made all of the major decisions. Since he has not developed a succession plan or exit strategy, there is no one in place to take over if he gets hit by the proverbial truck. He is the typical one man band; and, as a result, the company is not an attractive target … [Read more...]

You've made the big decision to put your business for sale. Your reasons for selling are valid, carefully-considered, and “good” – the kind that won't make a prospective buyer shy away. Now, you may tell yourself, comes the fun part. You'll come up with a price – maybe a little high, but why not? – and let gut instinct (an attribute common to successful business owners) lead the way. Wait just a minute. Or maybe a quarter of an hour; however long it takes you to bone up on your negotiation skills with the following steps as a guide. Being a smart negotiator is tantamount to effecting the successful sale of your business. Gather Your Forces The first step is to engage the help of a business broker professional. He or she understands the sales negotiation process as well as tactics for marketing the business for sale. Before sitting down with your business broker, however, you should gather the following information: profit and loss statements (for three years), current federal … [Read more...]

Who best understands my business? When interviewing Business Brokers and M&A Advisors to represent the sale of your firm, it is important that you discuss your decision process for selecting one. Without this discussion, a Business Broker / M&A Advisor can’t respond to a prospective seller’s concerns. Are there any potential buyers? When dealing with a Business Broker, it always helps to reveal any possible buyer, an individual or a company, that has shown an interest in the business for sale. Regardless of how far in the past the interest was expressed, all possible buyers should be contacted now that your company is available for acquisition. People who have inquired about your company are certainly top prospects. Lack of communication? It is critical that communication between the seller, or his or her designee, and the Business Broker involved in the sale, be handled promptly. Calls should be taken by both sides. If either side is busy or out of the office, … [Read more...]

When the day comes to sell a business, it is important that prospective buyers understand why you have made this decision. Buyer’s find this important and having a valid reason why it is time for you to sell can make your business more attractive to prospective buyers. After all, it is only natural that you will have to retire at some point even if the business is thriving. In fact, it is safe to state that buying a successful business from an owner that is retiring is just the kind of the situation that most buyers look for but they understand it can be for other reasons. Owning a business and retirement, of course, is far different than retiring from a job. You likely have many friends ranging from vendors and employees to customers, clients and other business owners. It is vital that your departure does not disrupt the operation of your business and that prospective buyers understand that you have taken steps to ensure a smooth transition. In short, you want to create a situation … [Read more...]

A common mistake that many make when preparing to buy a business or sell a business is to overlook all the various legal issues involved. A legal mistake can bring the entire process to a screeching halt or even worse case cost you a small fortune. For this reason, it is important to carefully evaluate the full slate of relevant legalities. This article will explore some of the key legal points one needs to consider long before placing your business for sale. Mistake #1 Neglecting to Have a Non-Disclosue Agreement Having potential buyers sign a Non-Disclosure Agreement, or NDA, is critically important when selling your company. One benefit to having this agreement signed and sealed is that in the event that the deal falls through, which often happens, the buyer can't disclose the details to other parties. However, if you don't have an NDA, the buyer could reveal important aspects of your discussions. This could impact any future sales. Mistake #2 Failing to Get an Experienced … [Read more...]