Broker professional standards

GABB Fall Conference 2016: Mobile Technology Boot Camp

Business has gone mobile. The top producers in business are those who have identified and use an organized mobile office system to stay productive, in communication and are responsive to clients’ needs.

Join the GABB on Sept. 27 for a Mobile Technology Boot Camp and explore some of the best and most effective ways mobile professionals can use their smartphones and tablets for efficiency worldwide.

The GABB Fall Conference will consist of a morning and afternoon session, each awarding three hours of C.E. credit. Attendees may sign up for the whole day, at $100 for members; $150 for non-members; or just one session for $50 for members, $75 for non-members. Registration will close on Sept. 23, so please register early to secure your space.

Breakfast 8:30-9 a.m. Provided by Kim Eells, Vice President, Business Development Officer of Brand Bank.

9-12 noon: Productivity, Social Media and the Mobile, Global Office

Learn about Cloud Apps, Social Media, managing listing photos for marketing and distribution with Google Multimedia, mobile calendar and document applications, and sharing data with Drive, OneDrive & Dropbox.

Lunch: Noon-1 p.m. Provided by GABB Platinum Sponsor Sarah S. Wheeler, Esq. of Moore & Reese, LLC

1-4 p.m. Time Management and Customer Relationships

This class will teach brokers how to effectively build and maintain a client relationship management (CRM) system as a process to attract, maintain and retain communications with consumers. Attendees will learn about how mobile technology and the cloud computing can help them become more effective at managing clients.

Instructor: G. William James (above) is one of the leading training professionals for handheld computing and mobile technology in the United States for retail, medicine, sales, business and real estate. A sales trainer and seminar presenter since 1986, thousands have heard his enthusiastic yet real-life approach to time management and sales excellence. James was an early user of PDAs, is devoted to handheld computing and has built his career on the technology. In 2003 he began teaching smartphones as well, and today teaches all platforms and devices on the Android, Apple iPad and iPhone, Blackberry, and Windows Mobile operating systems.

Read More

Six Ways Business Brokers Can Avoid Litigation

GABB member Lawrence Domenico, an experienced litigator, spoke to the Georgia Association of Business Brokers about how you can avoid litigation. Here’s what he had to say:

For you guys as Business Brokers, it almost always is better to avoid litigation if you can. Courts and Arbitration proceedings take a long time to complete and lawyers are expensive. The quickest you can expect to have a trial in Fulton County is a year after you file suit. Most business cases take several years. Moreover, there are lots of lawyers out there who are very happy to litigate to the death.

Before I tell you how to avoid litigation, please keep in mind, I don’t see most deals of business brokers because most go through to closing or the listing expires without success.

I only see the matters where brokers contact me because something is wrong with the listing.

It is probably not possible to never have a problem listing. There is a percentage of people that you cannot please and you will be in conflict them.

There are people that do not care about living up to their obligations, be it in a contract or otherwise.

These are often the same folks who have a tenuous grasp on reality and have a hard time telling the truth.

But there is good news, because these kinds of people exist, I will always have work to do.

What I would like to help you all with today is not dealing with these folks that I have just described. You will either have to sue those folks or walk away from them.

What I want to help you with today is minimizing the number of times you have to sue folks who have a grasp of reality, who generally do respect their obligations, but for some reason or another don’t see things the way you see them.

I have 6 recommendations for you to avoid litigation.

1. First, avoid these problem clients. Easier said than done, I know, but I think you already know how to spot these people. First and most importantly, trust your gut. Call it instinct or experience or karma, whatever, when you have a bad feeling about working with a client, you are probably right. Almost all my clients say at some point, “You know, I had a bad feeling about this guy way back when, but I went ahead with the engagement.”

In my own practice, I know this is true. The greatest regrets and biggest losses of money in my practice were when I blindly trusted a client, or thought they would change once they saw how sincere and diligent I worked for them, or got blinded by the potential fee.

If your gut is not warning you about a client, there are still things you need to do to avoid problems.

Ask yourself, what do you really know about new client?

Sometimes the concern is not so much stealing money from you as wasting your time.  A referral is the best, in my experience

This is true for hiring help, too. I far prefer to hire someone already known to me or someone at my firm. I always ask, “Are they crazy?” If not, you are way ahead.

Other options: make a personal visit to business; Google them; D&B; check references.

What do you know about the business? Co-broker if you’re not comfortable with the business or your experience.

2. Next, you must, must, must have a written listing agreement. Since the late Middle Ages, there has been a law called the Statute of Frauds that says certain contracts have to be in writing. Real estate contracts have to be in writing. Contracts which take more than a year to perform have to be in writing. So, if you want to sell a business, your listing agreement has to be in writing.

Don’t call me if you don’t have a listing agreement. I won’t have anything to work with.

Use the GABB form listing agreement. If not that, at least look at it to see if there is something you should add or change in the form you use.

The listing agreement must be in writing. If the seller is hesitant to sign, that is another strong sign that you may have a problem client. You should think long and hard about continuing your efforts for that client.

Also, if the client only wants to sign a listing agreement in the name of the company, and not individually as an owner, that is another strong indication that you have a problem client. Most of the business sales I have ever seen are really asset sales. The selling company still exists after the sale, but it has no assets. If you have a listing agreement only signed by a company with no assets, you have a problem.

3. Once you think you know something about the potential client, one of the best things you can do to avoid problem clients is to ask for a modest upfront fee. I know you guys typically get paid your fee at closing, but you do all your work before closing. If a client is not willing to pay you a small fee up front, and you can call it a marketing fee or an administrative fee or a listing fee, that is a strong indication that the client is going to be a problem going forward.

It’s the same in my business. If someone is not interested in paying me a retainer, that is a red flag.

4. Include a minimum fee in your listing agreement. I have had a number of cases where the listing agreement said the fee was a percentage of the consideration paid at closing. But what if there was no closing? Most of the cases in which I represent business brokers are cases in which there was no closing. The seller withdrew the business from the market or sabotaged the sale. If you don’t have a minimum fee listed, and there is no closing, the judge or arbitrator is going to have a difficult time awarding you any damages.

Judges and lawyers are familiar with contingency fees. If you don’t have a minimum fee provision in your listing agreement, it is going to look like a contingency fee agreement to the judge or arbitrator.

5.  Put a mandatory arbitration clause in your listing agreement. Arbitration is slow and expensive. Litigation is painfully slow and painfully expensive.

In arbitration, you get a lawyer to make the decision as to who wins and who loses. In litigation, 12 people off the street make that decision. A jury is a crazy way to make decisions. In my humble opinion, juries make sense in criminal cases. They are a check on the government. But in a business case, I don’t think they make any sense. If you have ever interviewed jurors after a case, you would hear the most random explanations for why they made the decisions they did. Your jury may think $20,000 is a lot of money to award you for a year’s worth of work. Speak with an arbitrator after he or she makes a decision, and you’ll get a thoughtful, reasoned decision, even if you don’t agree with it.

6. If you have a signed listing agreement, I encourage you to communicate regularly with your client. In my experience, clients don’t really understand what you do to market their business. Either through ignorance or willful ignorance, some clients think all you do is show up at closing to get a check. To fight against that ignorance, I recommend that you send regular letters or emails to the client detailing what you have been doing. Don’t go 3 months without communicating with your client. Regular updates to your client will not only combat the notion that you are not working for the client, it will be great evidence at a trial or a hearing if you end up in a dispute with the client.

Document your disputes. Lawyers are always asking clients whether they have anything in writing to document a dispute. I find that many people think that the kind of writing that lawyers are looking for is only a document that says Contract at the top of the page and is signed and notarized. That is not the case at all.

What is a “writing?” It can be a letter, or email, or a check. And here’s your tip of the day, confirm your agreement in a writing even without client’s signature. Send your client an email, “Jim, thanks for meeting with me today. I appreciate your promise to get me those financial statements by Monday. I’ll contact the buyers today and tell them the financial statements are on the way. As we discussed, this is one of the things you promised in our engagement agreement and if we don’t get those financial statements we cannot market your business.”

There is an assumption in the law that the recipient of a communication will respond if he or she does not agree with the communication.

This kind of email will give the judge, jury, or arbitrator a date, time, and the precise terms of the communication. It is not a “he said, she said” matter.

That’s my 6 recommendations. Probably not worth thousands of dollars. Don’t be afraid to call me or another lawyer before your relationship with the client has totally fallen apart. A good lawyer will tell you the good and the bad of your situation. Most times there are things you can do to save the situation. With counsel, you can make a bad situation better. And even if things fall apart, and you want to litigate, having a lawyer involved earlier will probably help you prepare your case for litigation which will increase your chances for winning.

 

Read More

DeFoor, Ramatowski to Lead GABB in 2016

ATLANTA—Greg DeFoor, founder and President of DeFoor Business Services of Kennesaw, is the 2016 President of the Georgia Association of Business Brokers, the state’s only professional association of business brokers. Michael Ramatowski, president of Georgia Business Associates, Inc., is the 2016 vice president of GABB.

GABB members represent owners of Georgia businesses and help them establish the sales price of their business, create marketing plans and strategies for the sale of their business, identify and qualify potential buyers, and work to protect the confidentiality of the entire process.

Other GABB officers are Jay Fenello of BizPlacements.com, treasurer of the GABB and Yasmine Jandali, owner and Managing Broker at Starwood Business Group,  the secretary of the GABB. Board members for 2016 are Richard Burgess, president of Priority Business Acquisitions, Inc.; Jeffery Merry, founder and owner of the BUSINESS HOUSE, inc. ^SM, and GABB Past President C. David Chambless, president of Abraxas Business Services.

Mr. DeFoor is a business broker, a CPA and a Certified Fraud Examiner. He became a business broker in 2002 after working in public accounting followed by private industry experience as an accounting and financial executive in the healthcare and retail automotive industries. While in private industry, he was involved in a number of business transactions and decided to use that knowledge and experience to start his own firm. He has a unique blend of audit, tax, accounting, corporate finance, business advisory and transaction experience to use for the benefit of his clients. He has an active Georgia real estate broker’s license. His firm specializes in the sale of small and middle-market privately owned businesses in a number of industrial classifications. Mr. DeFoor has an accounting degree from Auburn University and lives in Powder Springs.

Mr. Ramatowski, CBI, president of Georgia Business Associates, Inc., works with business owners and sellers and candidates for merger by acquisition from manufacturing, distribution, and service businesses. He has owned and managed businesses that included a real estate master franchise, a property management networking company, and a service business. As COO of a banking conglomerate he managed brokerage operations, title companies, home and service warranty programs, and a relocation company. Mr. Ramatowski has served on the board of directors of 12 different organizations with diverse specialties including real estate brokerage, mortgage companies, title insurance, banking, health care, fitness center operations, and office supply operations, providing marketing and organizational growth expertise. He served as an Electronic Specialist in the U.S. Navy Submarine Service. He attended Cleveland State University and Baldwin Wallace College. He has earned the Certified Business Intermediary professional designation by the International Business Brokers Association.

Mr. Fenello started his career as a computer engineer for IBM, Boca Raton, where he worked on a new product called the IBM PC. After a successful career in computer hardware and software design, he earned an MBA in Entrepreneurship from the University of Arizona.  He has been involved in small businesses and start-ups ever since. He first started in business brokerage in 1995, and has since worked for several brokerage firms, including one of the largest M&A firms in the country. Today, Mr. Fenello is with  Keller Williams Realty Partners, where he helps people buy, sell and improve small businesses and start-ups, especially owner-operated businesses and franchises. Jay has an engineering degree from the University of Florida, and an MBA in Entrepreneurship from the University of Arizona. He is a member of the Atlanta Commercial Board of Realtors, and lives in Woodstock with his wife Beverly.

Mrs. Jandali is an experienced business broker with a track record of more than 10 years of successful transactions and highly satisfied clients.  Mrs. Jandali founded Starwood Business Group in order to provide a boutique brokerage firm for clients seeking personalized service and specialized attention. As a certified Master Business Intermediary, she provides professional business intermediary services to both business sellers and buyers, including high-level business valuation services to business sellers. She has worked as a foreign exchange analyst at Wells Fargo, a marketing specialist at the Bank of America Corporation,  vice president of Jandali Enterprises, Inc., and was managing broker and managing director of VR Business Brokers Mergers and Acquisitions. She has a B.A. in Business Administration Marketing from the McColl School of Business at Queens University of Charlotte, and also studied management at The Belk College of Business at University of North Carolina at Charlotte.

Mr. Burgess is president and owner of Priority Business Acquisitions, Inc. & Priority Real Estate Services, LLC, of Lawrenceville, Ga. Mr. Burgess is a licensed business and real estate broker with more than 20 years successful experience handling the sale, acquisition and financing of privately held companies and real estate in the Southeastern United States. Mr. Burgess has a mechanical engineering degree from the University of Maryland, and he and his agents use a Christ-centered, straightforward, successful approach to their brokerage services. He resides in Lawrenceville, Ga., and is an active member of Christ the Lord Lutheran Church in Lawrenceville, Ga.

Mr. Merry is a lifetime member of the Georgia Association of Business Brokers (GABB) prestigious Multi-Million Dollar Club and was the first Georgia broker in the GABB to receive the Phoenix award for being in the Multi-Million Dollar Club for 10 consecutive years. Jeffery has been a member of GABB for more than 20 years, and is a past president and board member. He holds a Bachelors Degree from Mercer University, a Masters of Business Administration from the University of Illinois, and a Juris Doctorate from Atlanta Law School. He is also a licensed real estate broker in Georgia and Florida. Further, he is an Adjunct Professor of strategic management, accounting, and finance in MBA programs.

Mr. Chambless is the president of Abraxas Business Services, a business brokerage focused on businesses with revenues of $5- to $30-million in the manufacturing, logistics, technology, healthcare, and services industries. Mr. Chambless has extensive experience in business development, finance, operations, sales, marketing, and international channel development and management. Mr. Chambless’ service over a 12-year period with various technology organizations (including the Open Applications Group Inc., (OAGi), C=WIN, Inc. PsionTeklogix, QAD, Inc., and The CODA Group), gave him a deep understanding of issues involved in international business and investment. Earlier in his career, Mr. Chambless served as chief financial officer for Aaron Rents, Inc and for Docutronics, Inc. Prior to graduate school, Mr. Chambless commanded components of a U.S. Army Pershing Missile unit in West Germany. Mr. Chambless has a Master of Business Administration in Finance degree from the Wharton School of the University of Pennsylvania and a Bachelor of Industrial and Systems Engineering degree from Georgia Tech. He is a member of BENS (Business Executives for National Security), the Association for Corporate Growth, and the International Business Brokers Association, and he is a fundraiser for the Boy Scouts of America. He is a nominee to the board of directors of the Callanwolde Fine Arts Center. He is past-president of the GABB where he has been a long-time member of the board of directors as well as a lifetime multi-million-dollar member of the Million Dollar Club. He has served on the boards of directors for the Grant Park Conservancy and the Southeast Atlanta Business Association.

The GABB is composed of professionals who work with owners of Georgia businesses. Many of today’s business buyers are individuals who have decided not to re-enter corporate America, but are ready to control their own destiny by purchasing and operating a Georgia business. The GABB’s monthly meeting is at the South Terraces Conference Center at 115 Perimeter Center Place, Atlanta. For more information about the GABB, contact GABB President Greg DeFoor at president@gabb.org or call Diane Loupe at 404-374-3990.

 

Read More

How to gain and keep customers, and other advice from a Selling Expert

For business brokers or other solo professionals, the most valuable resource is your time.

Outsource, outsource, outsource, was the recommendation of Christopher Lemley, the director of the Georgia State University Professional Selling and Sales Leadership Program, who spoke on Tuesday, Jan. 26, to the Georgia Association of Business Brokers.

Gaining and keeping customers was the topic of Lemley’s presention, which also covered the tension between sales and marketing and social media. Lemley opened by citing Peter Drucker, founder of modern marketing: “There is only one valid definition of business purpose – to create a customer. Companies are not in business to make things … but to make customers.”

Things tend to be relatively easy to sell, Lemley said. “Services are a bit more difficult to sell, as most of you know.”

The reason services are more difficult to sell is that “we are all in competition with each other, but at a high enough level, in firms we have all worked with one another and have somewhat the same background” he said As such it is hard for potential customers to see what differentiates one service firm from another.”

So how can you market commoditized services and get customers to stay with you over time? You must overcome four things: intangibility, perishability, inseparability, and variability.

Intangible items are harder to evaluate. The minute a service is created, it is consumed, meaning the producer cannot warehouse it.

“In your business, if you don’t fill your capacity today, the opportunity to make that money is gone,” Lemley said. “You can never recapture that capacity.” A movie theatre can never recoup the revenue lost from showing a film to a half empty theatre.

Inseparability means “the customer sees us making the service, the customer is part of us making a service.” A factory can “hide all the nastiness,” but in the service industry, the customer sees “every little twist and turn.”

Invariability means that customers experience the service in differing ways depending upon their circumstances. Lemley figured he enjoyed his favorite Italian restaurant more on nights when the traffic getting there wasn’t as bad.

Lemley presented a sample worksheet (See: Gaining and Keeping Customers) on how to calculate the lifetime value of a customer, including revenues, cost and referrals. Showing his academic credentials, Lemley also demonstrated Porter’s Arrow, a graphic developed by Michael Porter of the Harvard Business School. The arrow, also displayed in the Gaining and Keeping Customers PDF, covers five dimensions of competition, including inbound logistics, operations, outbound logistics, marketing and sales, and service. Although marketing and sales are listed in the same group, and SHOULD be friends, Lemley argues that, “They ain’t, They ain’t.”

Why? Lemley says the reason is as old as the story of Cain and Abel. When two people are “doing the same thing, with discrete resources, they will always get in a fight. They are competing to get resources to get their job.”

It’s basic economics. Marketing and sales are competing for scarce resources in many, if not most, business organizations.

The key to avoiding conflict is to recognize their differing strengths, which Lemley went on to discuss in relation to the roles of producer, entrepreneur, administrator and integrator. It’s important to know when a company is considering a move, and not just to get a call when the RFP comes in.

Marketing and sales are the strategic tools firms and individuals use to strive to create a sufficient number of transactions so the firm has the potential to survive and prosper in the short- and long-term, Lemley said.

In a coordinated marketing plan, tools such as social media help “soften the market” so that when “the sales troops come through, they know who you are and will be receptive to a call from you.”

Social media is a key, cost-effective way to market, Lemley said. He cited a company that spent millions on advertising, and gave $100,000 to a social media project. The social media turned it into one of the internet’s most popular business-to-business sites.

“Any business that doesn’t have a social media presence is already five years behind,” said Lemley. Some of the best in social media have a PR background.

Companies should develop a sales force targeted at what business needs, not with what the sales force wants. For example, most universities have been scheduling classes when it’s convenient for faculty members to teach. However in the next few months, GSU will be unveiling an innovative, new project based upon a robust analysis of data, aimed at scheduling classes when students want to take specific courses.

Lemley worked through undergraduate school writing advertising copy at a radio station. Tiring of the “tyranny of the empty page,” he picked up an MBA. Lemley is a 28-year veteran in the marketing field where he has served in senior management positions for two of the largest international advertising agency networks. He is also the former managing director of the Professional MBA program at the J. Mack Robinson College of Business at GSU.

Lemley has worked with major national and international clients including Sara Lee Corporation, Twentieth Century-Fox Films, Universal Pictures, The Hoover Company, the Southern Company, Los Angeles Times, Newsday, Wrangler Jeans, Polygram Entertainment, Bertelsmann Music Group, Siemens, Federated Stores and Jack Nicklaus Development Corporation. In addition to his teaching duties, currently he consults with CEOs in turn-around and high-growth companies on many marketing areas including organization, sales, marketing communications, strategic marketing planning and the use of new media in commerce.

The Georgia Association of Business Brokers (GABB) maintains a website that lists hundreds of businesses and franchises for sale throughout Georgia in a variety of fields, including automotive, business services, child care, cleaning, construction, electronics equipment, fitness, flooring, floral, food, gas stations, landscaping, manufacturing, medical, shipping, restaurants, retail, security, signs, and businesses related to the internet.

For more information about GABB, email georgiabusinessbrokers@gmail.com or call 404-374-3990.

Read More