Navigating the Paperwork – Advice for Business Buyers: The Non-Disclosure Agreement



Buying a business is no small task, and many first-time buyers are initially intimidated by the paperwork required to make a sale happen. The good news is, however, the paperwork, contracts and red tape required of business buyers is totally do-able. You just need to stay on top of requirements, have patience and have the right help.

 

Non disclosure agreement with pen and glasses

 

We’ll start with the first paperwork you will come across, the non-disclosure agreement. This is an agreement you must sign in order to learn the name and physical location of a business that interests you.

 

Why do you have to sign it? When a seller puts their business on the market, the confidentiality of that for-sale status is crucial for protecting the business. When confidentiality is breached an entire staff can quit, vendors can cancel contracts and the competition may move in for the kill.

 

The non-disclosure agreement protects the confidentiality of the business by creating legal repercussions for a buyer who discloses the business inappropriately. You as a buyer can avoid these repercussions by keeping the information you are given to yourself and by following the instructions of your broker in regards to any financial documents or associated information you are given.

 

What if I don’t like a portion of the non-disclosure agreement? Can I cross out the portions I don’t like before I sign it? No, you can’t. Non-disclosure agreements are standard documents, and as such changes are not permitted.

 

If you are uncomfortable signing the non-disclosure, consider the reason it is needed. If you were selling your own business, you would want legal repercussions in place to protect that business. You wouldn’t be comfortable handing over sensitive and/or proprietary information to just anyone in that same way you probably wouldn’t be comfortable handing your personal tax return to the strange guy sitting next to you at a coffee shop.

 

You should discuss any reservations you have with your business broker, but understand that your refusal to sign a non-disclosure agreement will probably put a stop to your ability to buy a business.

 

Do you have more questions about the non-disclosure agreement and what it means for you as a buyer? Would you like to know more about the business buying process? Ask us! Please feel free to leave any questions or comments here and we would be happy to help.

 

Want to read part 2, The Purchase Contract? Click here.

Want to read part 3, The Commercial Lease? Click here.

 

Michael Monnot

941.518.7138
Mike@infinitybusinessbrokers.com
12995 South Cleveland Avenue, Suite 249
Fort Myers, FL 33907

http://www.infinitybusinessbrokers.com


The Entrepreneurial Child – How to Talk to Your Parents About Selling



Portrait of young and senior winery owners working together. Old winemaker and smiling sommelier working with laptop while tasting wines. Small business.

 

If you are the child of an entrepreneur, then you probably grew up in the family business. You might have napped in the back office and done your homework at your parent’s desk. Your chores might have included taking out the trash or washing dishes. Now that you are an adult, your parents might assume that your path in life includes taking over that family business so they can retire.

 

What if that’s not what you want?

 

You aren’t alone. Not everyone follows in their parents footsteps, and if you’ve found a separate passion along the way that you want to pursue, you should. The key to a happy life is doing something that you love, and (hopefully) with some discussion your parents will see things the same way.

 

There’s no way my parents are going to be okay with me doing anything else. Now what?

 

First of all, have you even asked? Any family with a family business needs to have a discussion about the future of the business and the possible succession to the next generation. If you haven’t had this discussion yet, no time is better than right now.

 

If you really don’t want to take over the family business, and your parents are counting on just that – there is a solution where both sides win.

 

Approach your parents with the idea of selling the business and then using some of the proceeds to buy a business that you can be passionate about, thereby preserving the entrepreneurial legacy of the family while at the same time pursuing your own dreams.

 

By selling their business they can also get a financial return on their investment of time, energy and money while simultaneously helping you on your own journey to business success. If they see that they can both make some money and give you the key to your own happiness – what parent isn’t going to want that?

 

Are you the child in a family business and want to know what comparable businesses have sold for? Do you have questions about what type of business you could buy? Please feel free to leave comments or questions here and we would be happy to help.

 

 

Michael Monnot

941.518.7138
Mike@infinitybusinessbrokers.com
12995 South Cleveland Avenue, Suite 249
Fort Myers, FL 33907

http://www.infinitybusinessbrokers.com


Cutting the Emotional Strings: Why Business Sellers Need to Be Mentally Ready



We come across two basic types of sellers in our business. The first type are burned out and totally ready to move on. These sellers are very motivated and typically have one foot already out the door.

 

The second type of seller is someone who is considering selling, but the decision has been excruciatingly difficult and the bond with their business, their clients and their entrepreneurial life is strong.

 

collection of various strings on white background. each one is shot separately

 

If you are a business seller who falls into this second category, you not only need to prepare your business to sell you need to prepare yourself.

 

Why?

 

Buyers can sometimes be insulting, and you don’t want this part of the business transaction process to keep you from a closing table. What do we mean by insulting buyers? We’re not talking about personal insults here, we’re talking about perceived insults to you business. Buyers come to the market looking for flaws, and they will use these flaws (perceived or not) to try and negotiate the best possible price they can get. A seller needs to have thick skin when the negotiating starts because your business will probably get picked apart and the value you put on the business will be whittled down. None of this is a personal attack on you. It is simply the nature of business transactions.

 

How do you deal with this? Know that it’s coming and realize that you would do the same things if you were in the buyer’s shoes. Negotiations happen so both sides can get the best deal possible, so leave your personal feelings aside if you want to be successful.

 

Another major hurdle for some buyers is the relationship they have with their clients. If you’ve known these people for many years you might feel like you should be honest with them about your intentions to sell. DON’T. Confidentiality during a business transaction is what keeps your business viable all the way to the closing table (read more about what can happen here). Telling you clients or even a loyal staff member will let the cat out of the bag and irreparably damage your business during a very important time – when you are trying to sell.

 

How do you keep the cat IN the bag? Don’t tell anyone about your potential sale until the deal is done. Realize that your clients aren’t yours, they belong to the business and by selling that business you are transferring those clients (and staff) on to the next owner.

 

Selling your business is an intense experience, so while you are collecting your financial documentation and getting the carpets cleaned for any potential buyer walk-thru – take some time to mentally prepare yourself for this big change in your life. If you are having trouble letting go – focus on what your life will be like after the sale, on what you’ll do with the proceeds from your sale and on your next big adventure.

 

Are you thinking about selling but are very concerned about what will happen to your clients or staff once you are gone? Do you want to know more about what you can do to prepare? Leave any questions or comments here and we would be happy to help.

 

 

Michael Monnot

941.518.7138
Mike@infinitybusinessbrokers.com
12995 South Cleveland Avenue, Suite 249
Fort Myers, FL 33907

http://www.infinitybusinessbrokers.com

 


Business Buyers: Why Believing In Entrepreneurial Unicorns Is A Mistake



Pop culture mythology is full of entrepreneurial unicorns – these semi-urban myth creatures who start a tech company and 6 months later sell it for millions or billions of dollars. Many hopeful budding entrepreneurs see these news snippets and falsely believe that entrepreneurship, if done the “right” way, can make them fabulously wealthy in no time at all.

 

unicorn word write on paper

 

If you are considering a career as an entrepreneur, you will essentially doom yourself to failure if you think the world of business ownership is quick or easy. It just isn’t. Believing you can enter business ownership and suddenly vault yourself into fabulous wealth is a dangerous way to enter a reality where hard work and perseverance are the only keys to success.

 

Want the cold, hard truth instead of entrepreneurial unicorn stories?

 

Owning a business is tough.

 

If you own a business, the buck stops with you. Even in a larger business with a management structure and many employees – you are ultimately responsible for the success or failure of your business. Business owners work long hours, can have high levels of stress and don’t always make tons of money (especially in the first few years). You need to accept that becoming the master of your own destiny by working for yourself means you need to have the drive and grit to get the job done.

 

You probably won’t get fabulously wealthy.

 

We all know the names of the entrepreneurial NFL quarterbacks like Zuckerberg and Jobs, but just like the chances of any high school football player making it to the starting lineup on Super Bowl Sunday, most entrepreneurs don’t become billionaires. This is not to say, however, that you wouldn’t make a good living owning your own business. If you work hard you can absolutely make a decent amount of money and have a good quality of life. Keeping yourself grounded in financial reality will keep you eye on the right goal – growing your business – instead of chasing an impossible amount of money.

 

Owning a business can be very, very rewarding.

 

Even though entrepreneurship is tough and probably won’t make you a multimillionaire, the benefits and rewards of owning your own business make the journey completely worth the effort. Owning your own business means you get to be your own boss. It means every dollar you make, you’ve made for yourself and not someone else. It means you have the flexibility to set your own schedule. It means you get to be the master of your own destiny. It means you get to wake up every morning and do something your love to do. The benefits far outweigh the effort it takes. Just head into the world of business ownership firmly grounded with realistic (and non-unicorn) expectations and you have a far better chance of success.

 

Are you thinking about becoming a business owner and have questions about how much money you can make when you own a business? Would you like to know what types of businesses are currently for sale in your area? Ask us! Please feel free to leave us any comments or questions and we would be happy to help.

 

 

Michael Monnot

941.518.7138
Mike@infinitybusinessbrokers.com
12995 South Cleveland Avenue, Suite 249
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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