The Five Big Blunders Business Sellers Need to Avoid: Blunder #2: Choosing the Wrong Business Broker



Small business owners are great at what they do. They own and operate a business that they have built into a success. When it comes time to put the business on the market, however, many small business owners make mistakes that will end up costing them a great deal of time, energy and money. How do you avoid these types of mistakes? Know what they are and how to avoid them. What follows is part two of a five part series that will help you avoid business seller blunders:

 

Choosing the Wrong Business Broker

 

The most successful business sales have something in common- a business broker (or brokers) that know what they’re doing. As a small business owner, you could potentially go out and find plenty of brokers who will list your business for whatever price you demand. The problem with this approach is simple. Your business is worth what someone is willing to pay for it, and a good broker will use market knowledge and a good dose of reality to price your business so that it will sell. Too often business owners will end up with a broker who will tell them anything they want to hear as long as they get the listing. This can become a major issue when your business is priced too high. It will sit on the market and you will wonder if your broker is doing anything to get your business sold.

 

It can be a hard pill to swallow if your business won’t sell for what you’d like to get for it, but an honest broker will tell you if your desired price is unreasonable or not. A goods broker will also tell you if there are any minor tweaks or fixes you can do to get top dollar for your business.

 

Another common issue is time. A broker who will let an owner list their business for a completely outrageous price will also likely give a very unreasonable time table for the close of the transaction. The average time it takes to get a business from listing to closing is 9 months. Do businesses sell faster than the average? Sure, but if a broker is giving you any kind of guarantee on a short time frame to closing, you should be suspicious.

 

The key here is to choose your broker wisely. Ask good questions like: How many businesses have you closed in the last 12 months? What do you think is a realistic asking price for my business and why? How long will it take to sell my business? A great broker will have great, honest answers. A so-so broker won’t.

 

Have you had a terrible business broker experience? Please leave us a comment or question here, and we will be happy to show you how our services are above and beyond the rest.

 

Michael Monnot

941.518.7138
Mike@infinitybusinessbrokers.com
1910 Park Meadows Drive, Suite 202
Fort Myers, FL 33907

http://www.infinitybusinessbrokers.com


The Five Big Blunders Business Sellers Need to Avoid: Blunder #1: Procrastination and Business Life without an Exit Plan



Small business owners are great at what they do. They own and operate a business that they have built into a success. When it comes time to put the business on the market, however, many small business owners make mistakes that will end up costing them a great deal of time, energy and money. How do you avoid these types of mistakes? Know what they are and how to avoid them. What follows is part one of a five part series that will help you avoid business seller blunders:

 

Procrastination and Business Life without an Exit Plan

 

If you want to sell your business the first thing you need to understand about the small business market is that business sales are not instantaneous. The average time that it takes to sell a business can vary greatly depending on the business sector, but a typical time line from listing to closing can be around 9 months to a year.

 

What this means for you is that you will need to prepare and plan way ahead of time if you would like your business to sell before a certain date or event. It is also important to remember that there is no guarantee that your business will sell by your goal date, but you will greatly improve your chances if you are ready.

 

A long-term plan for the ultimate sale of your business should technically start the day you open your doors. No one lives forever, and at some point you will need to deal with the end of your relationship as the owner of your business. If you have not been planning for this since day one, it is not too late to start.

 

Keep your records up to date and in a format that can be analyzed by a potential buyer (A huge box of crumpled receipts will not work!). Make sure all of your financial records, business history, and sales information is easily at hand if needed (If the right buyer walked into your life tomorrow, do you really want to have to tell them that you have no idea where your past three years of tax returns have gone?).

 

With every successful business transaction, there is a window of opportunity that you will not want to miss. The perfect buyer might be ready to buy your business two weeks from now or 12 months from now. The key to success is to be ready and have a plan in place.

 

Are you a small business owner who hasn’t given much thought to an exit strategy? Do you have additional question about how to make your business ready for an eventual sale? Leave us a comment or question here, and we will get your questions answered.

 

Michael Monnot

941.518.7138
Mike@infinitybusinessbrokers.com
1910 Park Meadows Drive, Suite 202
Fort Myers, FL 33907

http://www.infinitybusinessbrokers.com


The Five Big Blunders Business Sellers Need to Avoid: Blunder #1: Procrastination and Business Life without an Exit Plan



Small business owners are great at what they do. They own and operate a business that they have built into a success. When it comes time to put the business on the market, however, many small business owners make mistakes that will end up costing them a great deal of time, energy and money. How do you avoid these types of mistakes? Know what they are and how to avoid them. What follows is part one of a five part series that will help you avoid business seller blunders:

 

Procrastination and Business Life without an Exit Plan

 

If you want to sell your business the first thing you need to understand about the small business market is that business sales are not instantaneous. The average time that it takes to sell a business can vary greatly depending on the business sector, but a typical time line from listing to closing can be around 9 months to a year.

 

What this means for you is that you will need to prepare and plan way ahead of time if you would like your business to sell before a certain date or event. It is also important to remember that there is no guarantee that your business will sell by your goal date, but you will greatly improve your chances if you are ready.

 

A long-term plan for the ultimate sale of your business should technically start the day you open your doors. No one lives forever, and at some point you will need to deal with the end of your relationship as the owner of your business. If you have not been planning for this since day one, it is not too late to start.

 

Keep your records up to date and in a format that can be analyzed by a potential buyer (A huge box of crumpled receipts will not work!). Make sure all of your financial records, business history, and sales information is easily at hand if needed (If the right buyer walked into your life tomorrow, do you really want to have to tell them that you have no idea where your past three years of tax returns have gone?).

 

With every successful business transaction, there is a window of opportunity that you will not want to miss. The perfect buyer might be ready to buy your business two weeks from now or 12 months from now. The key to success is to be ready and have a plan in place.

 

Are you a small business owner who hasn’t given much thought to an exit strategy? Do you have additional question about how to make your business ready for an eventual sale? Leave us a comment or question here, and we will get your questions answered.

 

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com
1910 Park Meadows Drive, Suite 202
Fort Myers, FL 33907

http://www.InfinityBusinessBrokers.com


Franchise Re-Sales and Quick Profits, Why It Can Be Great to Buy a Franchise



When the owner of a franchise has decided to put his business up for sale, you could get the advantages that come with both running a franchise and buying a business.

If you purchase a franchise instead of a traditional small business, you get to run your own business while using the brand energy, advertising/marketing power, and the administrative and technical assistance of an established franchisor.

Looking for quick profits?

If you are acquiring an established franchise, then not only do you have the company brand and other systems in place; the entire business is already running, ready to go. You won’t have to wait for leases, build-outs, new equipment delivery and installation, etc. (though you do have to sign a franchise agreement).

That is not to say, on the other hand, that resale buying is a quick process. Like any major purchase, going through all of the business transaction and legal procedures can make it a time consuming enterprise.

 

When the closing day comes, however, you will be inheriting a business with an established presence. This will hopefully translate into quick operating profits because of the already established location and customers. This is unlike opening a new business where prospective customers would have to become aware of the new business.

 

This will be significantly easier if you are opening a well-known franchise, where you know brand knowledge will likely bring in customers right away.

 

Another plus to purchasing an existing franchise is you will also inherit a fully-trained staff. This will save you valuable time and energy that you may have had to spend recruiting and training new employees.

 

The benefits of inheriting an up-and-running franchise need to be analyzed, however, in the due diligence phase of the business transaction. For a smooth transition, be sure to look for a franchise that has a fully trained staff, a well established and positive reputation, and a fully equipped location.

 

After you uncover any issues during due diligence, you will have the opportunity to renegotiate the terms of the sale based upon what you find. If you discover aspects that may hurt your bottom line, you may be able to renegotiate your costs.

 

Should you be concerned that a franchise is up for sale? Does this mean that business is down and the current owner is trying to get out before the ship completely sinks? The answer to both is probably not. There are many reasons why any business owner decides to sell, and they can range from going into retirement to just wanting to start a new business venture. It is important for you as a prospective owner to figure out the real reason the current owner has decided to sell during due diligence.

 

Purchasing an existing franchise may be the right path for you because it will allow you to hit the ground running. Just be sure that you use your due diligence period and the services and knowledge of your business broker when deciding whether or not to go ahead and close the deal.

 

Are you interested in purchasing an existing franchise, but have questions about how the process works? Please feel free to leave us a question or comment here, and we will be happy to get back to you.

 

Michael Monnot

941.518.7138
Mike@infinitybusinessbrokers.com
1910 Park Meadows Drive, Suite 202
Fort Myers, FL 33907

http://www.infinitybusinessbrokers.com


Buying a Business: Interpreting the Value of a Business



If you are a prospective buyer looking to own you own business, you may have already noticed the unique nature of business listing prices- they seem to be all over the place.

 

How do you as a buyer interpret the asking price of a business as it relates to its actual value (which is basically what a buyer is really willing to pay for it)?

 

What follows are a few characteristics of a business that can greatly impact the value to you as a buyer, so be sure to look for them:

 

Consistent Numbers

If a business has very consistent numbers, it might mean less risk for a buyer. Remember that the value of a business to you is the earnings it will have in the future.

 

Operating Profits

In order for you to pay yourself and pay back any debt you incurred in the purchase of the business the business will need to be generating operating profits. A business who’s numbers consistently show operating profits will be a better bet than a business that is only breaking even.

 

Diverse Customer Base

In a business that has a diverse customer base (meaning even the largest customer only holds a small percentage of what the business earns) the loss of a customer will not be as fatal as in a business with only a small handful of clients.

 

Reputation and Brand

A business with a great reputation or a very well established brand will have a more loyal clientele, meaning less work for you as the new owner regarding building a customer base.

 

Good Managers

If a business is well managed by the management staff without the owner having to be present 100% of the time, and if those managers are willing to stay on if the business changes hands, it can be a good sign for a potential buyer.

 

If you need help determining if the listing price of a business really fits with an actual evaluation of the business, you can also turn to the services of your business broker, as they will know the current market and what aspects of a business bring the most to a new owner.

 

Are you a future business buyer who has questions about the value of businesses you have seen for sale? Leave us a comment or question here and we will be happy to assist you in your business search.

 

Michael Monnot

941.518.7138
Mike@infinitybusinessbrokers.com
1910 Park Meadows Drive, Suite 202
Fort Myers, FL 33907

http://www.infinitybusinessbrokers.com


The Questions a Business Seller Should Be Ready to Answer



If you are putting your business on the market, you should realize that at any given time there are a lot of other businesses for sale. What will make your business stand out in the crowd? A lot of that is up to you.

 

If you are a serious business seller, there are a few questions you should be prepared to answer.

 

(A caveat here, if you are answering any question from a prospective buyer, honesty is the best policy. Someone who makes an offer on your business will get a due diligence period before the close of the sale to go over everything in your business with a fine-toothed comb. Any deception found during this period will likely kill the deal, and even if it doesn’t, it will breed distrust between you and the buyer that will have to be endured for the duration of the transaction as well as the duration of any training and/or consulting period.)

 

Question #1: What do you do to grow your company?

 

A good business owner is never content with just the status quo. A great way to help a prospective buyer decide on your business instead of the competition across town is to tell them what you do to keep the business growing.

 

Question #2: What do you do to stay ahead of the competition?

 

Buyers want to know that they will have a fighting chance against your competition from the moment the business changes hands, so let them know the strategies you have put in place to stay competitive in your market.

 

Question #3: If you suddenly had an extra $100,000, what would you do with it?

 

This question is all about showing that you are and have been a business owner with a vision for the future of your business, a future that a new owner will get to embrace. Answer this question by highlighting the things you would love to do, but have not had the time or resources to accomplish yet.

 

Are you a prospective buyer who has asked any or all of these questions? Are you a seller who has questions about how best to answer questions like these? Leave us a comment or question here and we look forward to assisting you with your business transaction needs.

 

Michael Monnot

941.518.7138
Mike@infinitybusinessbrokers.com
1910 Park Meadows Drive, Suite 202
Fort Myers, FL 33907

http://www.infinitybusinessbrokers.com


Buy Your Own Business in the United States: Common Questions About the E2 Visa



What is an E2 visa?

 

If you are a business owner or budding entrepreneur in a country outside of the United States, one of the ways to get a visa that will allow you to live and work in the U.S. is to invest in a U.S. business venture. An E2 visa is a popular way to come to the United States because it does not require sponsorship, you will just need sufficient funds to invest into a U.S. business.

 

How much money would I need to get an E2 visa?

 

There is not currently a minimum (or maximum) investment that is required in order to apply for the E2 visa, but typically a business owner or new entrepreneur would need somewhere in the neighborhood of $80,000 to $120,000. That being said, every situation is different and will need to be evaluated by a business broker familiar with the E2 visa process. If you have a question about the funds needed to purchase a business in the U.S., you can contact us here.

 

Who will I need to work with to buy a business in the U.S.?

 

The E2 visa process requires the expertise of professionals who are familiar with E2 cases, so you will need the services of a business broker who has E2 visa experience and also a qualified immigration attorney. We have both, so please feel free to contact us here to speak with an E2 experienced broker or to get in touch with a qualified immigration attorney.

 

Are you a business owner who came to the U.S. on an E2 visa? Are you someone who is interested in the E2 visa process, but has questions? Please leave a comment or question here.

 

Michael Monnot

941.518.7138
Mike@infinitybusinessbrokers.com
1910 Park Meadows Drive, Suite 202
Fort Myers, FL 33907

http://www.infinitybusinessbrokers.com



Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

12995 South Cleveland Avenue, Suite 249
Fort Myers, FL 33907

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

12995 South Cleveland Avenue, Suite 249
Fort Myers, FL 33907




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