how to sell a business Archives - Page 6 of 11

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.

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

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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.

Hands off or Hands On- What Type of Business Owner Are You?

By Scott | June 24, 2010 - 9:20 am |July 19, 2013 business broker florida, buy a business, how to sell a business, Main, sell a business, selling my business, small business ideas, small business owner

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What kind of business owner do you consider yourself- Are you a Hands on Business Owner or do you consider yourself more of a big picture operator that consistently effort yourself to avoid the minutia of the business. I think the majority of us are a hybrid of these 2 approaches.

When running a small business, or involved with a startup business, on an almost daily basis you are faced with the question ” Do I do it myself or do I hire others to do it for me”. Most all are aware of the concept Time is Money- but like so many other business concept we all draw the line in the sand at different places. We are not always consistent with where we draw that line, and find that that line moves as or business moves or the economic climate around our business moves.

This question can be applied from basic business task of running to the post office to mail off some stuff or calling some prospects to significant larger issues like hiring outside help to handle your marketing functions, doing my own website, or trying to do my own SEO . I am a business broker and I help business owners and individuals in the process of buying or selling businesses. Selling ones business is a very significant event and very often like so many other decisions a business owner will decide to try to sell the business themselves or hire someone to help sell their business.

Are You A Hands-On Person Like Me?

This decision is part of the never ending series of question a small business owner needs to answer. In my current profession as a business broker if Florida I am faced with these same similar questions on a daily basis. Do I do it myself or subcontract out that task or role. ” Maybe someone else can do it better, but I can do it cheaper”, or “Maybe someone else can do it cheaper, but I can do it better…” Relatively speaking I am a fairly hands-on person.

My previous business I had owned for 20 years I was fairly hands on as well. I helped install our production equipment on day 1 of the business, I worked on the production line, I worked in the truck delivering product, helped troubleshoot our equipment, performed testing and so on. I also set our policies, accounting procedures, QC procedures and company philosophy. I enjoy knowing and understanding as much detail about my business as possible. Ultimately I was able to build a team of 25+ employees that both allowed our business to grow and ultimately allowed me to run the business from 1500 miles away for 7 years.

Photo (c) stage2planning.com

While others may say “I don’t want to know the details- I just want it to work”. People reach business success with both approaches. I have a good friend that owns a Plumbing business and has very little plumbing knowledge- he doesn’t want to. He is a very good businessman, with a very successful plumbing business – he is a big picture, hands-off guy and I think his wife may call me to fix their leaky faucet before she ask him. But again he is a successful business owner.

The real question that comes in is at what point does the hands on approach limit your business growth. When does- “I have to do it myself or it wont get done right” approach become business limiting? So many businesses do not make a transition to “count on others” and the business remains a certain size. If the company goal is to stay a certain size then this approach may be both applicable and appropriate.

Hands-On VS Hands-Off Business Owner

But as one desires to grow a business to a certain size- “letting go” a little control is needed. As working as a business broker in Florida very often I have business owners ask me can I just sell my business myself. Here is how I summarize my true beliefs on this very important question.

Most business owners I know have a fairly full day- to say the least. If your day is full already how can you possibly take on the task of trying to sell your business. And I truly believe this. Assuming selling your business is a fairly involved process how do you squeeze that continuous task into to your already packed stream of work. Maybe you say to yourself, I am going to devote a lot of time and effort towards selling my business, but then what suffers?

Does the business you are trying to sell now have the person steering the ship significantly pre-occupied? During a recent speaking engagement I compared the process of running a business to running a marathon and addressed the need to finish strong. Why run the race hard for 23 years or 23 miles and then stumble in for the last year/mile? It is important when one is selling their business to try to finish strong.

I beleive one of the most important decision a business owner makes its the decision to sell their business. Like so many decisions a business owner has to “do it myself” or hire others to do it. Can I do cheaper? Can I do it better? Do I have the time to do it? Do I want to do it?Some of the similar questions one faces every day waking up as a business owner, but when selling ones business the stakes are significantly higher.

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.

Selling With Your Ears -8 Steps to Improving Sales

By Scott | May 14, 2010 - 8:08 am |July 19, 2013 business broker florida, 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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“Nothing happens in this business until somebody sells something.”

Are you a salesperson? If you are in a small business or a startup I would be stunned if you said no. I have been with several companies throughout my business career, small, medium, and a large Fortune 100 company, some as an employee and some as an owner. My role currently as a business broker is to help people with the process of buying and selling businesses. How do you find people wanting to buy a business or sell a business- prospecting.

Whats The First Thing I Do When Meeting This Prospect- Listen.

My job of working with those in the buying and selling of businesses is really really a job of listening. I recall one of my first jobs out of college I was hired by a Fortune 100 company, and they would send all new employees off to corporate headquarters for 45 days of fairly intensive training. Training as a salesman/woman for that company involve quite a bit of technical knowledge on their products along with sales/marketing/time management skills. I studied the technical aspect of this product extensively. I felt when I got in front of a prospective client I just had to let him know all I had learned about this product without really slowing down to hear what they wanted to know. It seems a little silly to me now, but then I felt it was my job to tell them all I knew.

Photo (c) wikia.com

Today to me selling is listening to a customers needs and proposing a solution. As I work with those buying and selling businesses there is so much that goes into such a complex process that include the emotional side, the financial side, the timing, family, friends, employees, loyalties, that without listening to what a persons true interest is seems so mis-guided.

Overall, I’ve found Salespeople can seem to be looked at in a negative way by other departments within an organization, can be looked at disparagingly thru movies and stories, but my perspective on sales process or the sales person is a little different. I have a strong admiration of those involved with the sales process. The sales process can be defined in many different ways from taking orders over the phone to the full cycle process of identifying a target market, prospecting that target market, approaching that target market, and ultimately trying to parlay those contacts into gainful customers. The production department, or the service department may not like all the actions of the sales department, but very often the jobs in the production department or the jobs in the service department are dependent upon the sales department. I guess its ok to not like the salesmen or saleswomen in your company but from a business perspective you can not discount their value.

Some thoughts on Selling:

Were not selling stuff, were selling solutions
Selling is not trapping a prospect in a room or on the phone and subjecting them to our “pitch”, selling is maybe 80% listening 10% asking followup questions and 10% wondering if you have asked all the pertinent questions
When selling are we telling them what we want to tell them, or responding to what they are asking for
The true full selling cycle from development to implementation to closing a sale is an admirable achievement. Most that are successful at this can find many successes in business.
Many (maybe most) Presidents, CEOs, Vice-Presidents began their careers as a salesperson
All in the company should have a role in sales from CEO/President to receptionist- Do you think Steve Jobs- Apple, Bill Gates- Microsoft sells? – Absolutely
Listening is a skill… and maybe a salesperson biggest potential asset. – Like many others, I was fortunate to be born with 2 ears and just one mouth.
STOP- and pretend you are the buyer of your product or service- what do you want to hear?

I cant imagine meeting a person that wants to buy a business and not asking them what type of business do you want to buy?, where do you want to buy that business?, how much do you want to spend on that business?, what is important to you when buying a business? and so on.

When a person wants to meet with me regarding selling their business- I would like to know why do you want to sell your business? When someone runs a business for 5,10,20 ,30 years the why can be a pretty compelling answer. I continue to ask more questions and listening. It almost doesn’t even sound like selling, and I think there is nothing wrong with that. Maybe listening is a byproduct of experience, or maybe it is taught, or maybe some people are just better listeners than others. And maybe that’s what makes one a better salesperson than others.

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