Sell Your Business Now

Now may be the best time to sell your business in the last decade and there may be indicators that the window may not last for very long.

1 – Higher Multiples

You can read here (What are Multiples) a little bit more about what multiples are but over the last 18-24 months I have seen the multiples increase for many businesses. I have seen restaurants increasing steadily, insurance agencies getting record multiples, certain practices such as dental offices increasing because of the easy access to capital and many more examples.

2 – Quicker Sales Times

The average time a small business takes to sell is usually around 10 months. To give a few examples we received multiple offers on a business with a lack of records within 45 days, a franchise within 60 days and one of the longer businesses I have had on the market was at 9 months but it was a cash offer 25% over any sold comparable businesses that we could find.

3 – Lack of Good Businesses on the Market

There are 1,000’s of businesses on the market at anytime and although many look interesting once you start to look into the details the numbers cannot be proven, they have a bad broker that does not know how to properly market or package a business or so many other things that may come up.
Even a bad business can be sold if packaged and presented in a proper format.

4. High Demand for E2 Visa’s

At any time half of my businesses are being purchased on an E2 visa. The E2 visa in its most basic form is a citizen of another country purchasing a business for the right to live in the country for an indefinite period and it is a more simple and cost effective strategy than some of its alternatives. There are many different variables for a business to qualify for a visa such as the purchase price, number of employees, how income is derived…but there are also exceptions depending on the age of the business and other factors.

5. Baby Boomers

There are indicators that sometime between now and over the next several years that there may be a gulf of businesses on the market due to the anticipated amount of baby boomers retiring. Like anything supply and demand can have an influence over the price of a business or any other commodity.

I am here to assist with the listing price and can give an opinion of value with limited documentation and a short consult but ultimately the decision is yours what to list the business for.  With the trends of certain businesses if you were thinking about selling soon, now may be the perfect time to sell your business.

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

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The economic downturn hurt everyone, small business owners were no exception. Now the economic climate is improving, and so are the prospects for business owners who are thinking about selling.

 Businesses have been selling quicker, for higher multiples and the amount of businesses on the market and coming to market have decreased dramatically.

According to BizBuySell’s Second Quarter Insight Report, the second quarter of 2013 saw an improvement in the overall financial health of small businesses. As these small businesses do better, their numbers improve and they become more appealing to buyers.

 This turn in the outcome for small business ownership has changed the perception of buyers back to owning your own business as part of the American dream. This perception change has been a big help to those thinking about selling.

 The financial recovery has helped business sellers in other ways too. As home values and stock prices rise, so does the ability and confidence of buyers taking the entrepreneurial plunge. Better financial portfolios means buyers are able to generate bigger down payments and get business capital from third-party lenders.

 Banks and other traditional lending institutions who slammed shut the channels for third-party financing are slowly beginning to lend again, which is helping to bring more buyers to the market. There has also been a surge in the number of business sellers who, because their businesses are on the rise again, are willing to offer seller financing. These two financing options have opened the entrepreneurial market to substantially more prospective buyers, which is, of course, good for sellers.

 Have you been thinking about selling your business, but have wondered if now was the right time? For many business owners it might be. If you had considered selling in the last few years, but were apprehensive because of the state of the economic climate, now could be a great time to reconsider.

 Please feel free to leave us a question or comment here, and we can get you the information you need to answer the question “to sell or not to sell?”

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

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Entrepreneurs are smart people, and most are great at math. A problem arises, however, when a small business owner decides that they are interested in selling their business. More often than not, a business that is put up for sale by the owner alone will be priced incorrectly – so incorrectly that the business might never sell.

How is it that such successful people have no idea what their largest asset is worth?

First and foremost, deciding on a listing price for a business is complicated, and it can be difficult to remove yourself from the process. An owner knows exactly how much money and effort they have put into the business over the years, but a listing price is not a tally of those numbers.

Realistically, your business is only going to sell for what someone is willing to pay for it.

That being said, a business owner still wants to get top dollar and a good return on their investment of time, money and energy.

How do you reconcile those two needs with one number? Enlist some help.

Seek the advice of a professional business broker. They work in the market and know the nuances of setting the right price.

You might want all the money in the world for your business, but if you set the price too high right off the bat, potential buyers will be driven away, probably for good. Set your price too low, and you could wind up selling yourself short or inspiring suspicion from prospective buyers. A price that seems low might conjure the idea that you are selling because you want to get off a sinking ship.

Gather your financial information and have a talk with a qualified business broker. They will be able to help you price your business so that you can get the most out of the sale without scaring buyers away.

Are you a business owner who doesn’t know what your business should list for? Are you interested in finding out what your largest asset is worth to a buyer? Please feel free to leave a comment or question here, and we will be happy to assist you with your listing and pricing questions.

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

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Every business seller hopes to get top dollar for their business when the time comes to sell, but what factors can make this hope into a reality? What follows are some factors that can mean a better selling price for your business:

Top Of The Pile

If your business is the industry leader, or even just the industry leader in your area, this can be a major selling point. A business buyer is looking for a business with a great reputation and a long history of good performance. If you are the top business, you likely have those attributes.

Not there yet? If you are thinking about selling, but you are not your local industry leader, look at ways to increase your performance and improve your reputation.

Trending Upwards

Most business buyers want a business on the way up, so if your numbers can prove that your business is steadily growing, you will be very attractive on the business market.

Not there yet? Most businesses can improve their numbers by taking a fresh look at marketing and streamlining costs. If you want to sell in the next few years, begin implementing changes that will show growth.

A Hot Industry

This has less to do with your individual business than with the nature of the market, but regardless it can be a big bonus for a seller if your type of business is the one everyone is looking for.

Not there yet? If you’ve considered selling, but don’t know when the time will be right, pay attention to market trends. If your type of business becomes a hot commodity, you don’t want to miss the window to sell.

The Only Show In Town

An obvious advantage as a seller is to be the only business in your industry in your area. Your monopoly will be a great selling tool, as buyers interested in your industry will come only to you.

Not there yet? The way to become a local monopoly, if you aren’t one already, is to make strategic buys of all of your competition. If this strategy is not a possibility, look for ways to differentiate yourself from the competition. This will not only be great for your bottom line, it will be appealing to buyers as well.

The most important point to remember is that your business will only sell for what a buyer is willing to pay for it, so try not to get hung up on your listing price. If you are not quite ready to sell, but thinking it may be a possibility in the future, now is the time to start implementing changes that will appeal to buyers down the road.

Are you a business owner who is getting ready to sell, or thinking about putting your business on the market in a few years? Do you want to see what kinds of changes could help your buyer-appeal? Please feel free to leave us a comment or question here and we will be happy to get you answers.

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

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It can be really difficult to see a business that you have built from the ground up objectively, but there is a crucial decision that you will need to make as a business owner that will need to made without emotion- pricing your business.

As business brokers, we see it all the time. A new business comes on the market and it is priced ridiculously high. It might be a great business, but most of the time a business that has a crazy price will get no traction on the market and will stay listed forever.

When a business first hits the market it can create a lot of action from buyers, but those buyers can be permanently driven away if the price is too high.

Why do people list their businesses too high?

Usually one of two things has happened:

1. They got some bad advice. There are great professionals like business brokers and business transaction accountants that can help a business owner price their business right. There are, on the other hand, lots of professionals who know little to nothing about the buying and selling of businesses who give terrible pricing advice. This is usually not intentional, as they are using the knowledge they have to put a price tag on a business. The problem is that most of the time this price is way too high. Your regular CPA that you use for your tax returns or the business attorney that handled a labor dispute do not know enough about the business market to give you the right kind of advice. Seek the advice of a qualified business broker who will know how to price your business the right way- to sell.

2. They wouldn’t listen. Even though you have put all of your blood, sweat and tears into your business, a buyer is only interested in numbers you can prove. Your business broker will help you use comparable businesses that have already sold, the numbers you have on the books and other pricing qualifiers to help you set your asking price realistically. Pricing only becomes an issue if you as the seller refuse to listen to the advice. A good broker will not let you demand any price you want, they will refuse the listing if you decide that it is your unrealistically high price or “the highway”. Be very wary of a broker who will let you list your business for whatever you demand- you will end up staying on the market indefinitely.

Are you a business seller who made the mistake of pricing your business too high? Have you asked for advice on setting the price but got an answer you didn’t agree with? Please feel free to leave us a question or comment here, and we will be happy to help you with finding the right price for your business.

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

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As confidence in the economy starts to grow, many Baby Boomers have thought the time may be approaching to sell their small business and get ready to enjoy retirement. There are a few important considerations any business seller needs to make before putting their business on the market.

Here are a few tips to help you get ready to retire from business ownership:

Ideally you should really begin to prepare your business for sale the day you open the doors, as a good exit strategy is always good business practice. You should always think of your business as an investment instead of as a way to get a paycheck because this mindset helps you to think more long term.

If you haven’t had an exit strategy from day one, it is never too late to start, and the sooner you do, the better. An optimum amount of time before a sale would be three years, as this would give you time to implement value-building strategies and have the effect of these strategies show up in your numbers.

If your business is larger than a one man shop, then you should make sure that you build and maintain a well-trained staff and a quality management team. A new owner will need a strong team in place to make for a successful transition, and having these key personnel already in place will be a strong selling point.

Unless your business is brand new, you may need to give the physical appearance an update. Just like cleaning, painting and staging a home helps the sale, so will a fresh coat of paint in your establishment. As brokers, the most common feedback we get from prospective buyers is that a business was dirty, so thoroughly clean or hire a professional cleaning company to do it for you. It is also a good idea to make any minor repairs that are necessary, as anything a potential buyer sees that needs to be fixed will come off the top of the price they are willing to pay.

Lastly, and probably most importantly, hire the right kind of people to help you sell your business. You will need someone, a professional business broker, who can properly market to buyers and help you decide on an asking price. Trying to sell a business is a full-time job, and you don’t want to take that time away from your business while it is on the market, because a lack of attention on your part will surely hurt the value of your business.

Are you someone who is getting ready for retirement? Do you need help getting your business ready to be listed or do you have questions about your options? Please feel free to leave us a comment or question here, and we will be happy to help you get ready for retirement.

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

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The process is more simple than you may think.
We will initially conduct a short phone interview to gain insight into your business such as general revenues, how income is to be proven, products/services offered…Afterwards we will send a request for data specific to your business and will follow that up with either a meeting or more lengthy phone conversation.

Our goal is to ask all of the right questions that a buyer will ask, incorporate our findings into a buyers memorandum that will consist of important data for a buyer, recasted financials, a strength and weakness analysis and much more all used to properly sell your business.

Many times brokers send minimal information. I have seen anything from a simple name and website given to the tax returns sent. Most buyers do not possess the skills to properly read and recast financial statements and is not the first impression you want to give a potential buyer but rather when a buyer receives our marketing package they often know rather quickly if this is the right business for them.

Why list your business now?

We have an increasingly growing data base with buyers from all over the world, a direct marketing program, we have a large network of brokers that we cooperate with, attorneys and CPAs referring their buyers and we have been selling good businesses in much less time than the average typical timeframes and often for above average multiples.

Contact us to sell your business now.

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

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