When It’s Time to Sell, Put Your Strengths First
Putting your strengths first will help you sell your business. While this may seem obvious, a surprising number of business owners will either improperly index the strengths of their business or fail to emphasize those strengths adequately. In this article, we will examine five key business strengths that you should focus on when it comes time to sell.
Understand Your Buyer
You know your business, but you don’t necessarily know what buyer is best for it in the long run. If you’ve never sold a business before (and most business owners haven’t), then you may not know how to best position and present your business for sale.
A business broker is immensely valuable in this regard. These professionals are very good at determining which prospective buyers are serious and which ones are not. Additionally, a business broker will use their own databases of prospective and vetted buyers and try to match your business up with the prospective buyers that are most likely to be a good fit. When dealing with a buyer, a seasoned business broker will put emphasis on your strengths whenever possible.
Be Sure to Maintain Normal Operations
Selling a business can be very demanding and underscores, once again, the value of working with a business broker. A business broker will focus on selling your business so that you have more time to focus on the day-to-day of running your business.
The last thing you want is to waste your time on buyers who are not serious. Remember, if your business suffers as a result of the time you spend away from your business in the sale process, then the value of your business to prospective buyers could suffer.
Determining the Best Price
If you incorrectly price your business, you could dramatically reduce the interest. Business brokers are experts at pricing businesses and can help you determine the best possible price. Many business owners have unrealistic valuations and others may even undervalue their businesses or they fail to incorporate all aspects of their business. Working with a professional business broker can help you quickly achieve the best price. The best price possible will work to maximize the strengths of your business.
Getting Your Business Ready for Sale
There is a lot that goes into getting your business ready to sell. The simple fact is that getting your business ready to sell isn’t a one-dimensional process, but instead involves every aspect of your business. Getting your business ready to sell isn’t about making it look presentable and putting a “new coat of paint” on things, although this is a factor.
Instead it is necessary to have every aspect of your business in order. From paperwork such as tax returns, contracts and forms to a business plan and more, it is important to consider every aspect of your business. You should consider what you would want to see if you were the one looking to buy the business. Be sure to do everything possible to build up your strengths.
Confidentiality
If word gets out that your business is up for sale, there could be a range of problems. Employees, including key management, could begin looking for other jobs and suppliers and key buyers could begin to look elsewhere. In short, a breach of confidentiality could lead to chaos.
Getting your business ready for sale means factoring in the strengths and weakness of your business then fixing weaknesses whenever possible and building upon your strengths. Working with a business broker can help you address every point covered in this article and more.
Copyright: Business Brokerage Press, Inc.
Read MoreAdvertising rules for Business Brokers
Monica Gilroy, esq., a founding principal of The Gilroy Firm, spoke to the Georgia Associations of Business Brokers on Oct. 30 about rules governing advertising businesses for sale and real estate.
Ms. Gilroy is the firm’s managing partner and has more than 25 years of experience practicing law. She is an active partner in the Litigation Department as the focus of her national litigation practice includes all aspects of real estate litigation.
Linked here is her presentaton. Advertising For Business Brokers – October 30 2018
Ms. Gilroy remains an active partner in the Litigation Department as the focus of her national litigation practice includes all aspects of real estate litigation, including property management issues, fair housing, foreclosure and title disputes, broker and agent liability defense, mortgage fraud-related litigation and civil and commercial contract disputes. She also leads the Default Department providing national foreclosure, bankruptcy, and loss mitigation and eviction services. During her career, Ms. Gilroy has served as the litigation liaison for leading lending institutions as well as managed their national bankruptcy litigation program. She continues to serve as counsel for many national and local banks, mortgage companies and real estate industry lenders and leaders. She regularly assists closing attorneys, real estate agents, property managers, title companies and brokers when title or other contract issues arise. She practiced for several years in the areas of estate and trust litigation and serves regularly as a Special Master in Fulton County. Ms. Gilroy has extensive lead counsel trial experience and frequently appears in all of the state and federal courts of Georgia, including the state and federal appellate courts. She is also a member in good standing with the United States Supreme Court.
Ms. Gilroy has conducted hundreds of jury trials, bench trials, arbitrations and mediations and regularly argues dispositive motions of all kinds.
Ms. Gilroy is the immediate past Chair of the Real Property Law Section (“RPLS”) of the State Bar of Georgia, which is the largest section of the state bar. She previously served as the Editor of the RPLS Newsletter. A long-standing member of the State Bar of Georgia, she was appointed by the last five Presidents of the State Bar to serve on the Programs Committee.
In addition to the numerous articles, papers and publications over her career, she is a contributing writer to Foreclosure Law and Related Remedies: a State-by-State Digest which is published by the American Bar Association. She recently was published by Thompson Reuters in the book, Inside the Minds: Mortgage and Finance Fraud Litigation Strategies, 2015 ed.
In 2014, Ms. Gilroy also was selected to serve on the American Land Title Association (ALTA) National Education Committee, one of only a dozen members who write the curriculum for ALTA members. Recently, she was honored to draft an Amicus Brief on behalf of ALTA for a case pending in the Georgia Supreme Court.
Ms. Gilroy enjoys membership with the Lawyers Club of Atlanta, the Georgia Women’s Lawyers Association, Georgia Mortgage Bankers Association, the Atlanta Board of Realtors and the Atlanta Volunteer Lawyers Foundation. She speaks and teaches on a regular basis at the state and national level to attorneys, real estate professionals, property managers, and real estate brokers and agents on litigation and real estate related topics. Ms. Gilroy holds an AV-peer review rating with Martindale Hubbell. She is a peer nominated Georgia Super Lawyer for three years running in the practice area of real estate.
Ms. Gilroy is a longtime volunteer for the Girl Scouts of Greater Atlanta, serving as a group leader and teen mentor, as well as a volunteer coordinator for the Fulton County Public School System. She is also an active volunteer educator in her church in Johns Creek, Georgia.
Read MoreValuation Theory PowerPoint by Dan Browning
Dan Browning, a GABB Affiliate, has 20 years of experience as a business appraisal professional and holds the Master Analyst in Financial Forensics (MAFF) and Accredited in Business Appraisal Review (ABAR) designations from the National Association of Certified Valuators and Analysts (NACVA).
He spoke to the Georgia Association of Business Brokers on Oct. 30 about the complex issue of valuation theory, or how to set a fair market value for a business.
PROFESSIONAL DESIGNATIONS AND MEMBERSHIPS
- Master Analyst in Financial Forensics (MAFF) from the National Association of Certified Valuators and Analysts, originally awarded August 1999
- Accredited in Business Appraisal Review (ABAR) from the National Association of Certified Valuators and Analysts, originally awarded March 2010
- Georgia Association of Business Brokers (Affiliate Member)
- State Bar of Georgia (Active Member; Eminent Domain and Nonprofit Law Section Memberships)
- Editorial Board, Business Appraisal Practice (IBA Journal) 2013-2015
EXPERT WITNESS TESTIMONY
- Mr. Browning has been admitted as an expert witness for testimony at trials in the Superior Courts of DeKalb, Gwinnett, Fulton, Henry, and Clayton Counties, with deposition testimony in numerous other jurisdictions.
PRESENTATIONS AND SEMINARS
- Institute of Business Appraisers (IBA) and National Association of Certified Valuators and Analysts (NACVA) Ethics and Standards Webinar, October 2009
- IBA/NACVA National Conference, Ethics and Standards, May 2009
- IBA Southeastern Regional Conferences, 2001, 2002, 2003, and 2008
- Georgia Association of Business Brokers Education Conference, 2005
- IBA National Conference, 2000 (full-day demonstration trial participant)
EDUCATION
- University of Notre Dame, Master of Arts (Government), January 1995
- Emory University School of Law, Juris Doctor, May 1992
- Emory University, Bachelor of Arts, May 1985; Phi Beta Kappa
ADDITIONAL SKILLS AND EXPERTISE
Mr. Browning possesses a background in non-litigation forms of dispute resolution, with coursework in alternative dispute resolution theory and practice from the Emory University School of Law and experience as a Hewlett Foundation Scholar at The Carter Presidential Center’s Conflict Resolution Program. He has also consulted with several nonprofits (particularly arts and religious/social service groups) on business practices, organization, and management.
Evaluating Your Company’s Weaknesses
The time you spend evaluating your company’s weaknesses is, as it turns out, one of the single best investments you can hope to make. No one should understand your company better than you. But to fully understand your company, it is essential that you invest the time to understand your company’s various strengths and weakness.
Your company, from the beginning, has been an investment. It’s an investment in your time, your mental energy and, of course, your financial resources. The time and effort you expend to locate, understand and then fix your businesses’ weaknesses is time very well spent. Addressing and remedying your businesses’ weakness will not only pay dividends in the here and now, but will also help get your business ready to sell. Let’s turn our attention to some of the key areas of weakness that can cause some buyers to look elsewhere.
An Industry in Decline
A declining market can serve as a major red flag for buyers. You as a businessowner must be savvy enough to understand market situations and respond accordingly.
If you spot a troubling trend and realize that a major source of your revenue is declining or will decline, then you must branch out in new directions, offer new goods and/or services, find new customers and also find new ways to get your existing customers to buy more. Taking these steps shows that your business is a vibrant and dynamic one.
You Face an Aging Workforce
It has been well publicized that young people, for example, are not entering the trades. Many trades such as tool and die makers will be left with a substantial shortage of skilled workers as a result. No doubt, technology will replace some, but not all, of these workers.
This is an example of how an aging workforce can impact the health and stability of a business. If your business potentially relies upon an aging workforce then it is essential that you find a way to address this issue long before you put your business up for sale.
You Only Have, or Primarily Rely Upon a Single Product
Being a “one-trick pony” is never a good thing, even if that trick is exceptionally good. Diversification increases the chances of stability and can even help you find new customers. Additional goods and services allow you to weather unexpected storms such as a supply chain disruption while at the same time provide access to new customers and thus new revenue.
The Factor of Customer Concentration
Many buyers are concerned about customer concentration. If your business has only one or two customers, then your business is highly vulnerable and almost every prospective buyer will realize this fact. While it is an investment to find new customers, it is well worth the time and money.
A business broker can help you evaluate your company and, in the process, address its weaknesses. Remedying your businesses weakness before you put your business up for sale and you will be rewarded.
Copyright: Business Brokerage Press, Inc.
Read MoreWhat Should You Evaluate When Buying a Business?
Buying a business can be an exciting prospect. For many prospective business owners, owning a business is the fulfillment of a decades long dream. With all of that excitement comes considerable emotion. For this reason, it is essential to step back and carefully evaluate several key factors to help you decide whether or not you are making the best financial and life decision for you. In this article, we’ll examine five key factors you should consider before buying a business.
What is Being Sold?
If you hate the idea of owning a clothing store, then why buy one? The bottom line is that you have to have a degree of enthusiasm about what you are buying otherwise you’ll experience burnout and lose interest in the business.
How Good is the Business Plan?
Before getting too excited about owning a business, you’ll want to take a look at the business plan. You’ll want to know the current business owner’s goals and how they plan on going about achieving those goals. If they’ve not been able to formulate a coherent business plan then that could be a red flag.
You need to see how a business can be grown in the future, and that means you need a business plan. Additionally, a business plan will outline how products and services are marketed and how the business compares to other companies.
How is Overall Performance?
A key question to have answered before signing on the bottom line is “How well is a business performing overall?” Wrapped up in this question are factors such as how many hours the owner has to work, whether or not a manager is used to oversee operations, how many employees are paid overtime, whether or not employees are living up to their potential and other factors. Answering these questions will give you a better idea of what to expect if you buy the business.
What Do the Financials Look Like?
Clearly, it is essential to understand the financials of the business. You’ll want to see everything from profit and loss statements and balance sheets to income tax returns and more. In short, don’t leave any rock unturned. Importantly, if you are not provided accurate financial information don’t hesitate, run the other way!
What are the Demographics?
Understanding your prospective customers is essential to understanding your business. If the current owner doesn’t understand the business, that is a key problem. It should be clear who the customers are, why they keep coming back and how you can potentially add and retain current customers in the future. After all, at the end of the day, the customer is what your business is all about.
Don’t rush into buying a business. Instead, carefully evaluate every aspect of the business and how owning the business will impact both your life and your long-term financial prospects.
Copyright: Business Brokerage Press, Inc.
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