Beware the Part-Time Business Broker: Why Only a Full-Time Intermediary is Right for Your Business

Posted in Business Broker Why & How, Sellers Articles

Published July 14, 2013

It happens all the time.

 

We meet CPA’s, real estate agents, attorneys, and even doctors who, when they find out that we are business brokers, say “I do a little bit of business brokering on the side”.

 

As former business owners ourselves, this is a horrifying thought.

 

If you were in the middle of an IRS audit, you wouldn’t go to a dermatologist who dabbles in accounting; you would go to a qualified CPA. The same goes for your business.

 

You don’t want someone who is unable to dedicate their attention to your business transaction because their expertise and focus is in a completely different profession. You want an experienced and qualified business intermediary who does this and only this for a living.

 

Why? Can’t my real estate agent help me sell my business? The short answer is no. Selling a home is almost nothing like selling a business. If your real estate agent is a true professional, they will realize selling your business is beyond the scope of what they do and refer your business transaction to a business broker instead.

 

There a few things that a business broker brings to the table those other professionals can’t:

 

Confidentiality

When you sell your business, confidentiality is if the utmost importance. Without it, your business is sure to suffer. You don’t want your competition, your staff, or even your vendors to know that the business is on the market. When you sell, you have to get potential buyers into the business while maintaining the strictest confidentiality possible. An experienced business broker will know how to do this, will have the appropriate non-disclosure agreements ready to be signed, and will be able to market your business while keeping those who need to be in the dark in the dark at all times.

 

Marketing Power

A business broker has access to networks of buyers, networks of other brokers and their buyers, and access to business databases that other professionals will not. Business brokers put together marketing packages for businesses every day, and they have the experience and knowledge that allows them to put your business in the best light for prospective buyers.

 

Industry Know-How

A successful business broker is successful because they are great at what they do. They know the ins and outs of the buying and selling of businesses. They know how to properly price and market businesses. They know how to get you through the due diligence phase successfully. They know how to navigate all of the red tape a seller will need to go through. They have this knowledge because they are experts at buying and selling businesses.

 

When you are considering selling your business, be sure that the professional you hire to help you knows what they are doing. Make sure that they are truly a business intermediary or a business broker, not someone who dabbles just for fun. Ask the question, “Is this your full-time profession?” If the answer is no, find a dedicated full-time business broker instead.

 

Are you a business seller who has been approached by professionals other than brokers or intermediaries to sell your business? Do you have questions about why you should use a broker instead of someone else? Please leave a comment or question here, and we will be happy to address and questions or concerns you may have.

 

 

 

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

 

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How a CPA Can Help Their Clients Sell Without Losing Clients of Their Own

Posted in Business Broker Why & How

Published June 26, 2013

As a CPA, your paycheck depends on client acquisition and client retention. This can cause a conflict of interest when your small business clients get to point in life where they are considering selling. Do you advise them that they are ready to sell, and then end up one client down? Or do you try and prolong your business relationship by telling them they should wait a few years to build the business before putting it on the market? One answer is obviously more ethical than the other, but for a CPA who is concerned about retaining their small business client numbers, there is a third option.

Work with us.

Why? Most of our buyers come from out of state or even out of the country, and what that means for your accounting business is client number retention. We work with CPA’s and the business sellers that come out of their client lists with a focus on making sure the buyer of the business ends up working with the same CPA that the seller did previously.

How do you make sure I keep my client numbers?

An out of state or international buyer typically doesn’t come to the closing table with any of their own business contacts, and we know how important a client list is to a CPA that has agreed to work with us, so we match the CPA who has already worked with the business with the new buyer. What your accounting business ends up with is client number continuity, and the buyer gets the benefit of working with a CPA who already knows their new business inside and out.

This can be a great win-win for all of those involved, but this is not a practice that all business brokers follow. We know and understand how hard you’ve worked to grow your accounting business, and we don’t want you to lose clients when a business is sold. By choosing to work with us and refer your clients who are interested in selling to us, you can rest assured that we will work to keep the business on your client list.

Are you a CPA with clients who are ready to sell, but you were concerned about losing the business as a client if they do sell? Contact us today or leave us a question here, and we can further explain our process of CPA client retention. We look forward to working with you!

 

 

 

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

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Business Brokers: Why You Need One to Buy a Business- What They Can Do, and What They Can’t Do

Posted in Business Broker Why & How, Buyers Articles

Published November 30, 2012

If you are in the market to buy a business, you will be making what could potentially be one of the biggest decisions of your life. Working together with a professional business broker will make this process work out best for you in the long run. Only by working with a broker can you ensure that you are buying the right business for you with the very best terms and price possible.

 

So what can a business broker do? A business broker is a transaction broker. They facilitate the buying and selling of businesses. A good broker will help you match potential businesses for sale with the skills and goals you have, and will help you avoid businesses that are not well suited for you. They will help throughout the acquisition process, and act as intermediaries between you and the seller. They work with both parties to ensure a transaction structure that ultimately works well for everyone.

 

A business broker is not able to conjure up the perfect business. All businesses and all business ventures do come with a certain amount of risk. The business sale process is rarely easy, so you should be prepared to have issues at times. These issues may arise between you and the seller, with your new competitors, with the staff and vendors, or just with the economy in general. When you first take over the business, you may have difficulty producing the same results as the former owner, and should prepare yourself for a bit of struggle. Your broker should help you to understand and be prepared for both the acquisition and the transition of the business.

 

Have you used a business broker in the past, or do you have more questions about what a business broker brings to the transaction table? Leave a comment for us here, and we will be happy to hear your thoughts and answer your questions.

 

 

 

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

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What Does a Business Broker Bring to the Deal?

Posted in Business Broker Why & How

Published November 15, 2012

When buyers and sellers consider entering the business market, they often consider whether or not to use the services of a business broker. Do you really need one? The short answer is a definite YES. What follows are the roles that your business broker would play in your business transaction:

 

-Evaluation

An important role that a business broker plays is in the proper evaluation of businesses. As a seller, it is often difficult to give your business an accurate evaluation, and buyers want to know that the evaluation of a business they are considering is correct.

 

-Confidentiality

It is critically important for the sale of the business to remain confidential throughout the sale process, as the business can be adversely affected if staff, clients, vendors, or competitors find out it is on the market. Business brokers always work to keep confidentiality in place.

 

-Marketing

As a seller, you may not have the experience in business marketing necessary to properly highlight your business and attract buyers. Your broker also has access to potential buyers that you wouldn’t, so they can bring critical exposure that can help to get your business sold.

 

-Red Tape

Do you know all the ins and outs of a business transaction like licensing, permitting, contracts, and leases? Your broker does, and this knowledge can be invaluable when getting a deal through to closing.

 

-Intermediary

When large sums of money are exchanged between strangers, a certain level of distrust is common. How do a buyer and seller get a deal closed if they don’t trust one another? They use a broker to communicate with one another, and the broker can help create compromises when difficulties arise.

 

When deciding whether or not to use a broker in the business market, consider that if you don’t, all of the responsibilities above will fall to you. Do you have the time and expertise that will make your business transaction go smoothly?

 

 

 

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

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Using a Business Broker Advantages

Posted in Business Broker Why & How

Published October 1, 2012

Many buyers and sellers of businesses will use a business broker to assist with the business-for-sale transaction, and there are many good reasons why that’s the case. In simple terms, business brokers act as middlemen between business buyers and sellers. But they offer much more than that. If you are buying a business or selling a business, it helps to understand the role of business brokers in the process.

Advantages

Assistance in Valuing a Business

Business brokers have extensive knowledge of what businesses are worth and can usually derive a business value that is fairly accurate. Without a business broker, it is tough for sellers to accurately place a realistic evaluation on their business.

Help in Presenting the Business

Business brokers are adept at packaging up a business to show it in its best light. Without a business broker, a seller may not be able to market their business in a way that is attractive to buyers.

Aid in Attracting Buyers

Business brokers know how to attract buyers. In many cases, they have a database of buyers and send out business-for-sale alerts to their database whenever they have a new business listing.

Confidentiality

Business brokers work in a confidential manner, keeping the sale of the business in confidence so that competitors, employees, suppliers and others are not informed that the business is for sale.

Experience in Evaluating Buyer Intent

Business brokers are able to quickly ascertain whether a potential business buyer is serious or just kicking the tires.

Service as an Intermediary

Buyers and sellers generally don’t trust each other. The business broker can serve as a middleman to interpret communications and lead the buyer and seller towards compromises whenever possible.

Expertise in Business-for-Sale Transactions

Finally, the business broker knows all the minutiae required to close a business sale transaction. Typically, a buyer and seller may not understand all the nuances of getting the deal to closure, so it’s good to have an experienced business broker involved who can facilitate the process.

 

 

 

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

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How to Decide if a Prospective Franchise is Profitable: Deriving Reality From the Franchise Disclosure Documents

Posted in Business Broker Why & How, Buyers Articles

Published September 9, 2012

The Franchise Disclosure Documents (FDD) are the documents provided to a prospective franchisee.  The disclosures of these documents are required by law, but since they are not considered public information, the numbers may not be reflective of actual earnings.  Only around 25% of parent companies publish their claimed earnings in the FDD.  Most consider publishing this information as dangerous, perhaps allowing competitors too much insight into how they are doing or giving a new franchise owner a misconstrued vision of future profits.  These numbers, if you can get them, may not be very helpful to you as a prospective franchisee anyway.  Average profits from many diverse locations are not necessarily going to be indicative of your experience with the franchise.  You will have to consider all the variables that can lead to success or failure.  Your management style, the local competition, the location, and the general health of the market are all factors that will ultimately determine your own success as a business owner.  Even franchises located within similar markets can show marked differences in performance.  You must also be wary of the franchisor using its superior performing franchises as the example.  Typically these only represent around 20-25% of the franchisees.  The FDD may give you valuable insights into a franchise, just use the information wisely.

 

 

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

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What you Should Know – Selling Your Business: What Can Business Brokers Do?

Posted in Business Broker Why & How, Sellers Articles

Published March 5, 2012

Selling your business is a major decision!  You have devoted your time, money and energy to building, running and operating your business.  It may well represent your life’s work.  You have decided that now is the right time to sell, and you want the very best professional guidance you can get.  This is when working in tandem with a professional business broker can make the difference between just getting rid of the business and selling it for the very best price and terms!

 

Below is one of the most common questions asked by sellers.  The response is based on both experience and knowledge.  If you have any questions that we have not covered please don’t hesitate to contact us.

 

What Can Business Brokers Do – And, What Can’t They Do?

 

Business brokers are the professionals who will facilitate the successful sale of your business.  It is important that you understand just what a professional business broker can do – as well as what they can’t.  As your business broker we can help you decide how to price your business and how to structure the sale so it makes sense for everyone – you and the buyer.  We can find the right buyer for your business, work with you and the buyer, every step of the way until the transaction is successfully closed.  We will also help the buyer in all the details of the business buying process.

 

A business broker is not, however, a magician who can sell an overpriced business.  Most businesses are saleable if priced and structured properly.  You should understand that only the marketplace could determine what a business will sell for.  The amount of the down payment you are willing to accept along with the terms of the seller financing can greatly influence not only the ultimate selling price, but also the success of the sale itself.

 

Are you thinking about selling your business and have questions about what a business broker will bring to the table? Would you like to know what businesses like yours have recently sold for? Please feel free to leave questions and comments here and we would be happy to help.

 

 

 

 

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

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So You Own Your Own Business…

Posted in Business Broker Why & How, Sellers Articles

Published March 5, 2012

Do you own your own business?

 

 

Congratulations, you are the backbone of the United States economy. It isn’t the “Fortune 500”, the Wall Street giants – it is definitely the entrepreneur that has made this country the greatest in the history of mankind.

 

Now something that you may not be aware of, someday you have to make a decision that you probably haven’t given much thought to… one day your participation in the business will have to come to an end.

 

When it becomes obvious, you have three choices and two of them are not good: 1) Sell. 2) Liquidate. 3) Shut down and fade away. Oh, forgot to mention you could pass it on to your children, which generally will end up in category 3..

 

Next question: What is your business supposed to look like if you are going to take it to market? Having been in the business for many years, we can assure you that this is the most important question of all.  If everything is not in order, your business will not sell.  If you are fortunate enough to receive an acceptable offer, that is just the beginning and not the end, because of a process called “Due Diligence”. Your business must pass muster in a buyer’s eyes in order to get to the closing table.

 

There are any number of things that will stop a sale in it’s tracks.  You need to be aware of what they are.  Your solution is to spend some time with an experienced and knowledgeable business broker. An experienced broker can guide you from listing all the way through due diligence and on to closing. Make the best choice and talk to one of our brokers today.

 

Have you thought about selling and are curious about what businesses like yours have recently sold for? Do you have questions about the business sale process? Leave any questions or comments here and we would be happy to help.

 

 

 

 

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

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Why Would I Use A Business Broker To Sell My Business?

Posted in Business Broker Why & How, Sellers Articles

Published March 5, 2012

Why would I use a broker to sell my business?

 

 

There are many reasons to use a business broker and every day I get reluctance on why I am not needed to assist in the sale of the business.

 

While some people are successful at selling their own business many times you do not hear about the problems that were encountered either during or especially after the sale and many times the business was really just an asset sale of a very small business.

 

Most businesses have so much at stake and mistakes can be very costly that we can justify our fees and there have been many times that I have gotten the seller more than what they actually had anticipated.

 

1. Confidentiality

 

The number 1 reason to use a business broker is confidentiality.

 

From personal experience I have seen customers stop paying or frequenting a business or employees quit! If this happens this adversely affects your business. I have seen bartenders take the clients after they have found out the business was for sale, contractors that have not gotten paid when their sub-contractors found out they were selling, vendors that have told other restaurants that a business was selling and every single competitor that finds out will use that to their advantage.

 

All of these circumstances can adversely affect the sale of a business and can greatly diminish the value of your business. I have a proven method to confidentially market your business, qualify potential buyers and making sure that it is not your competitor trying to find out who is for sale.

 

2. Evaluation – Don’t leave money on the table

 

How much should I ask for my business? There are so many factors that are dependent on this and rarely are sellers very close on what they should be asking. On smaller businesses too often I see a seller asking too much for their business and of course it does not sell and the seller ends up just closing the doors due to the inability to find a buyer but there are many cases on the other end of the spectrum as well. I have recently sold several businesses for over 150% of what the seller had anticipated on getting. Sometimes this is due to the demand for a certain business, improper record keeping and sometimes a seller just wants out.

 

After a proper evaluation which includes a proper presentation package and even re-creating a sales log or financials can we truly attract the right buyer for the business as showing a P&L or tax returns is just not doing you justice. Sometimes training an employee, a slight restructure or the company is also needed but after an in depth consult we will pinpoint any issues and all of the positives that your business really has.

 

3. Business Continuity

 

The average business that actually sells takes about 9 months. Qualifying 10’s or 100’s of potential buyers is very time consuming and many times a single buyer can take hours out of any single day going over the particulars of a business or industry. When you start to factor in the time and money that you spend trying to find a buyer you may have lost out on sales or neglected other aspects of your business when in fact you should be concentrating on building your business and making sure that business as usual is happening. Many buyers are very astute and can recognize lapses in your business and will make sure to discount your business because of that.

 

Let us handle the marketing and you focus on doing what you do best and that is run your business.

 

4. Marketing

 

I am here to provide maximum exposure at no cost to you. We have dedicated telemarketers, mailing campaigns, we are on dozens of websites, we have a large network of current buyers from other states and many other countries as well as access to over 1,000 other business brokers that I will market your business to so you can be assured that if someone is looking for a business like your we will find them!

 

5. Legal protection

 

I have seen a recent study that shows nearly 25% of all closed business transactions are ending in litigation. This can be from improper contracts, buyers will sue if they feel that they were lied to or if they feel like they did not receive what was expected or any other reason. To protect yours interests in any type of lawsuit is very costly.

 

Our process is to prevent any lawsuits through education and documentation. Although there are no guarantees to prevent a lawsuit I have protected sellers when a claim has come up that has prevented litigation and even mediators siding with my seller.

 

As you can see there are many reasons to use the right business broker.

 

Feel free to comment, post any questions or experiences that you may have had and I look forward to working with you.

 

 

 

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

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Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

9040 Town Center Parkway
Lakewood Ranch, FL 34202



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