sell a business florida Archives - Page 6 of 11

Business for Sale-Who, How Many, How Much?

By Scott | July 31, 2010 - 7:59 pm |July 19, 2013 business broker florida, buy a business, how to sell a business, Main, sell a business, sell a business florida, selling my business, small business ideas, small business owner

Businesses For Sale In Florida

Florida is experiencing the current economic downturn and is somewhat representative of the US economy. Actually Florida may be feeling the effects of the downturn more than most of the US as its economy seems very tied to the real estate industry. I have always found value in trying to understand some of the numbers behind the numbers to help me to perform my role as a business broker. The following are some items of note as it relates to business buying and selling activity in Florida.

Certainly not all business sold do involve a business broker, nor are all businesses sold in Florida handled thru this association, but as a rather large association it is fairly representative of the buying and selling activities in Florida. Web based businesses and or websites may be sold at an online auction, larger “brick and mortar” companies may seek larger M&A firm for representation, but the activity within this association does provide some insight for the business owner outside of Florida that may buy or sell a business.

Per the currently active listed data available thru the BBF Association- As of today almost 4000 business are for sale of those:

1) Businesses For Sale in Florida over $10M – 5

2) Businesses for Sale in Florida Priced over $5M- 30

3) Florida Businesses for Sale Priced over $1M – 330

4) Businesses in Florida For Sale with Net Income over $100K – 1227

Other observations:

a) Largest type of business Listed For Sale in Florida– Restaurants – 773 (this represents almost 20% of all businesses listed) of those 223 have Net Income >$100k.

b) Home Based Business For Sale – 402 (represents about 10% of all businesses listed for sale)

c) Florida Internet related businesses for sale 43, of those: Asking Sale Price $1M+ is 8, those with net income over $100k – 20

Businesses Sold in Florida thru the Business brokers of Florida

of all the business sold in the last year (6/2009-6/2010) Here are the following Averages on Florida Business Sold.

Average Sales/Revenues- $636k
Average Selling Price- $252k.
Average Adjusted Net Cash Flow – $114k.
Average number of Days to sell the business- 226 days or approx. 7 1/2. Please note this figure does not include business that got listed for sale and did not sell. Estimating those in the average time to sell a business may exceed a year(my guesstimate ).

If you own a business and do not plan on exiting from that business for several years, it still makes sense to understand the value of your business. What is the asset that you have worth? What sort of multiple of cash flow should your business sell for?

Understanding what other similar businesses are selling for does provide some basis. but the devil can be in the detail… Also growing your company thru acquisition can be both a viable and profitable business decision. What may it cost to acquire a synergistic company? A review of some reliable numbers may be a good first step in the needed due diligence.

(some info shared above compiled from Business Broker of Florida Assn website as of 7.30.2010)

Selling My Business – How Much is my Business Worth

By Scott | July 19, 2010 - 4:03 pm |July 19, 2013 business broker florida, buy a business, how to sell a business, Main, sell a business, sell a business florida, selling my business, small business ideas, small business owner

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Selling My Business How Much is my Business Worth. Almost all businesses are for sale to some degree. Lets say your business is not For Sale. Assume Your business is worth $100,000. You love what you are doing, someone contacts you with an offer to buy your business for $500,000. Is your business now For Sale? The preceding is not a likely scenario for most business owners. To successfully sell your business planning and preparation is needed. But if you are now or at some point considering the sale of your business you may want to consider the following 3 points:

1. Identify your honest interest level when selling your business. Early in the decision process of selling your business consider what approach you may take towards selling your business. As a Business Broker in Florida I interact with the various interest levels by small business owners.

My business is not for sale but if someone walks in and offers me way more than what I think it is worth- I would sell my business
My business is not for sale but if you run across someone that would want to buy it please let me know.
I want to pursue selling my business but I won’t sell it for less than…( A somewhat inflated price) . I am willing to accept that it may take 1-2 years to sell my business, and if priced too high I can accept the fact that my business may not even be sold.
I want to pursue selling my business and after significant due diligence I feel the price I am seeking is consistent to what other like businesses have recently sold for.
I want to sell my business and I want out now. I will set my price aggressively and set a lower price than price currently sought for businesses similar to mine. I will expect this aggressive pricing to both help me sell my business and decrease the amount of time it will take to sell my business.

If you do have a true interest in selling your business as suggested in above last 2 points you do need to exercise due diligence to gain understanding of what the value of your business may be.

Photo (c) nett.com.au

2. You can expect that the perceived value of your business to you and the value of the business to a potential buyer will probably be 2 different values.

Ultimately the price of your business is what a willing and able buyer is prepared to pay to buy your business.
Seek “reasonableness” to your price that you will seek to sell your business for. If similar businesses to yours are sold at 1 1/2 times adjusted cash flow, why is yours worth 3 times adjusted cash flow?
Ask yourself what you honestly would pay to buy your business.
Do a free Search on my website https://www.sellabusinessflorida.com 0r similar sites to research what similar businesses to yours is asking to sell their business for. Remember – all businesses are different, but use such a search as part of your due diligence. A business for sale asking price and the price a business sold for can be greatly different, but asking prices can provide some basis-while current Businesses Sold information is more pertinent
Speak to your trusted advisers. A business broker may be able to help with non-public info on sold businesses in your area. Your accountant or attorney also may or may not be aware of such sales as well. A Professional Business Valuation specialist may benefit you.

3. Whether it is part of your exit strategy to sell your business or not, you should have an exit strategy.

Most small business owners do not have an exit strategy.
If you own a business you should have an exit strategy. Do some planning, perform some due diligence. Know what you have or may have.
Even if you are not planning to sell your business there is value in knowing approximate value of this potentially large asset. You know what your house is worth, you car, your other assets. Understanding the value of your business can be a significant piece of information when planning ahead.

Selling ones business can be a rewarding experience when done properly. Understanding a proper value for your business can set the stage to a successful sale of your business or a business that is unable to find a willing and able buyer.

Can a Goat Herder Teach Banks How to Loan to Small Business

By Scott | July 12, 2010 - 5:45 pm |July 19, 2013 business broker florida, buy a business, entrepreneur, how to sell a business, Main, sell a business, sell a business florida, selling my business, small business ideas, small business owner

Change Of Perspective For Business Owners

Now- For a moment pretend that you are a poor goatherder walking to town to get a loan , you don’t have any money to open a savings account with, you don’t have any normal collateral to secure a loan with, you don’t have a credit record as you have never been formally employed and you’ve never taken out a loan before. Also consider that you might even be unable to complete the necessary paperwork as you are illiterate. You earn about $1/day, and you want a loan of $250 to buy more goats to grow your business. Do you think you will get the loan? – Due to Micro financing the the goatherder may get the loan before the Lexus college graduate.

Many of us Entrepreneurs and Small businessmen/women donate time and or money to various causes or needs. I have been involved with Kiva since 2007. Kiva provides microfinance to Third World Entrepreneurs to help them grow their business. Kiva was founded by 2 former 20 something year olds that were former employees of TIVO and PAYPAL.

Microfinance is the supply of loans, savings, and other basic financial services to the poor. As the financial services of microfinance usually involve small amounts of money – small loans, small savings etc. – the term “microfinance” helps to differentiate these services from those which formal banks provide. Why are they small? Someone who doesn’t have a lot of money isn’t likely to want to take out a $5,000 loan, or be able to open a savings account with an opening balance of $1,000. Hence – “micro”.

These are small loans, multiple lenders will “pool” their loans to come up with a lump sum to provide to the Entrepreneur. Again most of the Entrepreneurs I have loaned money to over the last 4 years earn less than $1/day. When an entrepreneur pays off a loan, I reloan those moneys to another. So far I have loaned to 18 different entrepreneurs and repayment of loans have been 100%. Sinces 2005 Kiva as a group has loaned almost $150,000,000 to almost 400,000 Entrepreneurs and repayment has been 98.27%.

Why can this organization have such success in getting loans repaid from those with so little and banks in our “developed nations” loaning to those with abundant resources have problems so significant that these banks need a “bailout” from their govenment and ultimately taxpayers. Is it the conventional bank that is doing something wrong? Are they loaning to the wrong people on a consistent basis?. How much of the blame falls on those that are requesting the loan?

Getting A Loan For Your Business

Currently how many good entrepreneurs and small business are not able to get loans as a result of mistakes made by conventional banks in the past. It seems to me that banks tend to over respond to problems. Obviously if you are a lender and want to have no loans default and you loan no money- you can achieve your goal.

As a business broker I see the need for lending to allow buyers to finance the acquisition of buying a business. I also see income statements and balances sheets of reasonable small businesses that are using credit cards to help finance their businesses. It is hard for me to understand how our economy is benefitting by having small business owners take these “whatever is necessary” financing steps when traditional prudent lending to small businesses could truly be our fastest way to our economic recovery.

The banks reduce/tighten their lending, the need for small business financing continues, higher interest is being paid thru credit card financing, non-conventional means, and when does that higher expense cause employee reductions. Small business could divert money from high interest payments to investments and improvements that actually improve their business and create jobs.

Why can the goat herder get a loan and the Print Shop owner not? Or maybe if I were a banker I could ask why does the goat herder pay off his loans and the Lexus driving College Graduate Default? I understand there is a lot more that goes on between the comparison of a conventional bank and micro finance- but maybe conventional banks could learn something from Micro finance groups such as Kiva.

Starting Buying Selling a Business: What Are They Thinking?

By Scott | July 5, 2010 - 10:14 am |July 19, 2013 how to sell a business, Main, sell a business, sell a business florida, selling my business, small business owner

1 Comment

Want to start a business? Want to Buy a Business? Want to Sell your business? These interest are very different but there is one common element among these significant business decisions. Money- . While working with business owners and individuals with the process of buying and selling businesses, I consistently come across a common element that I believe would be surprising to most that are ” looking from the outside in”.

Money is always a determinant factor in the process, but so very often it is the other factors that create the motivation that steers the process. As a small business owner or one that recently started a business one wonders if the thoughts, trepidations, or concerns that you have are shared by others. It is common to wonder if others struggle with decisions such as you. What are some of the thoughts others have regarding these important decisions.

Motives Behind Buying/Selling A Business

Photo (c) expertbusinessadvice.com

Currently I am working with business owners that are selling their businesses and it may be somewhat surprising that money is not the primary reason they have decided to sell their business. But make no mistake all business owners want the maximum amount they can attain for their business but the reasons for selling are varied and different.

I am also working with several individuals looking to buy businesses and they as well generally are looking for some sort of change. Again they are looking for value in the business they are seeking to buy, but the reasons they are looking to get into something different are also varied and diverse.

Many people out there, and readers of business articles such as this are contemplating change. So many of tomorrows business buyers are employees that are working for someone else today. They are seeking change. Many of the business owners looking to sell their business are seeking change. Most all starting a business, buying a business, selling a business are seeking change. When talking with seller of businesses and potential buyers of businesses one learns the “why” is varied, and comprises similar thought processes I experienced as one that both started a business, bought several businesses and sold my own business as well.

Perspective very often if the difference maker in what drives this business decision. The excitement and energy that comes along with doing something new where the roads ahead are full of unknowns and optimism can certainly provide different perspective than the business owner that has experienced the challenges and sees the roads behind him. The reasoning behind the decision to buy start or sell a business may look very similar but it really is the perspective that provides the different “take” on that reasoning.

I want to Buy a Business, I want to Start a Business because…” –

1)MONEY– want to make lots
2)PASSION– I love making widgets
3)ACCOMPLISHMENT– It just feels good
4)OBLIGATION– It was my families business
5)EXCITEMENT– I love working 24/7
6)CONTROL– I control my own destiny
7)OPPORTUNITY– I’m young-limitless
8) CHANGE– I want to do something different

“I want to sell my Business because “-

1)MONEY-Not making enough, money is less important
2)PASSION– I used to love making widgets
3)ACCOMPLISHMENT– The feeling of accomplishment is gone
4)OBLIGATION– My family is no longer around
5)EXCITEMENT– after working 24/7 I am now Burned out
6)CONTROL-Insurance Companies,employees,IRS,State,control my destiny
7)OPPORTUNITY– I feel old- exceeded my limit
8) CHANGE– I want to do something different

While the list could go on and on, Contrary to common belief—– Its not always JUST about the money.

Business Succession

By Scott | May 26, 2010 - 7:03 pm |July 19, 2013 business broker florida, buy a business, how to sell a business, Main, sell a business, sell a business florida, selling my business, small business ideas, small business owner

What Your Business Success Relies On?

A few key points from this workshop:

Most businesses do not have a succession plan.
Planning is the most important first step.
Seller financing can help facilitate a deal but one must do proper due diligence.
Relying on your business as your only source of retirement funds is dangerous and mis guided.
When doing your annual reviews of company numbers or tax preparation, use that as a good time to look at other matters as it relates to your biger picture

My suggestion is between handling your accounts receivables, accounts pay ables, other office paperwork, social networking, working with clients, and returning phone calls/emails, take a moment to consider what your exit plan may be. Even if you just give the subject a few moments of thought, you may find yourself ahead of most or your peers and fellow business owners.

Also, the Internet is a great source of information on business succession and other business matters, but also keep your eyes open for the various seminars, workshops, and expos that may be in your area. They are not only a great source of knowledge, but also a great opportunity for the “other type” of social networking.

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