Why No One Is Buying Your Business: The Price Hurdle



If you are considering listing your business, you may have thoughts about how you think the process is going to go.

 

The version of your business sale that exists in your mind, however, is likely to be more fantasy than fact. You probably imagine that shortly after listing for what you consider a more than reasonable price multiple offers from motivated sellers will come pouring in – and a fierce bidding war will ensue. Within a month of this imaginary listing scenario you are drinking margaritas on the beach with the proceeds of your highly successful business transaction in hand.

 

Reality, unfortunately, will be nothing like this fantasy business sale.

 

If you are considering selling your business, one of the most important things you can do to have a successful transaction is to manage your expectations. Going into the selling process with a realistic attitude will mean that you are able to deal with issues as they arise and will be better equipped to negotiate with buyers. In this first article of our “Why No One Is Buying Your Business” series we will look at the biggest expectation hurdle for sellers – price.

 

Jointed doll jumping over a 500-Euro-Banknote, on white background

 

Your business is your baby, and we get that. We’ve owned businesses too. You invest countless hours, what feels like endless streams of money and tons of energy into this enterprise – and then you have to put a number on all of that investment.

 

Most sellers who set their own price set it way too high. The reality of business sales is you aren’t going to get back every penny and every hour you’ve ever put in. Your business is going to sell for what a buyer is willing to pay for it – and that number will be related to the market, your current cash flow, the value of your inventory, etc.

 

If you are unfortunate enough to get an inexperienced broker or a broker who wants your listing with no intention of ever trying to sell it, you will likely be allowed to list your business for whatever you want. This is a huge mistake.

 

A business priced too high will languish on the market, and any buyer who takes a look will wonder about the credibility of a seller who would ask for such an unrealistic number.

 

Someone who is serious about selling their business will instead look for a broker who will help them put a realistic listing price in place – a price that can be backed up by the market and the numbers in the books. A fair listing price will bring the serious buyers in the door and give you a far better chance at reaching a closing table.

 

If you are serious about selling or are curious about what you might be able to get for your business, contact us and we can discuss a realistic listing price.

 

Join us for the second article in this series where we will discuss another big sales hurdle – purchase contract terms.

 

 

Michael Monnot

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

https://infinitybusinessbrokers.com


What Are Business Buyers Buying?



If you are considering selling your business, then you might be curious as to what buyers are currently buying. The May 2016 BizBuySell report, The Demographics Of U.S. Small Business Buyers And Sellers (read the full report by clicking here) holds some clues:

 

buyerspricerangesimage

From BizBuySell’s The Demographics Of U.S. Small Business Buyers And Sellers, May 2016 Report
(read the full report by clicking here)

 

Over half of the buyers looking for businesses are shooting for a business in the $100,000 – $499,999 range, great news if your business listing price falls within that range.

 

 

topbuyersectorsimage

From BizBuySell’s The Demographics Of U.S. Small Business Buyers And Sellers, May 2016 Report
(read the full report by clicking here)

 

Good news also if your business fits into one of the top five categories of restaurants, retail, internet businesses, manufacturing or bars.

 

Do you have a business (like a restaurant or retail business between the $100,000 – $499,999 range) that hits one of the marks currently popular with buyers? Would you like to know what businesses like yours have recently sold for? 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

https://infinitybusinessbrokers.com


How Online Reviews Affect Your SEO & Attract New Customers



By Guest Contributor Krystal Burroughs – www.reviewdriver.com

 

localsearch

 

Unfortunately just relying on your website, social media and paid online advertising is not enough to always ensure you are attracting new customers. We have all spent too much time and money on our website to only find later that no one was visiting the site. Then we hear if we pay for SEO, blog and post to our social media sites daily that will bring the ideal customers our way.

 

While all the above are great plans for being found online there is still something else to consider. According to a recent study by Moz “Online reviews may make up 10% of the factors that search engines like Google use to rank pages”.

 

In addition to ranking what are your potential customers seeing about your business online?

 

How important are online reviews?
90% of consumers say they read online reviews before making a purchasing decision.
72% of consumers will take action only after reading a positive online review.
86% of people will hesitate to purchase from a business that has negative online reviews.

 

Not surprisingly many of the first calls I have with potential clients is them lamenting about bad reviews and how they are hurting their business. The questions to ask yourself when you find you are unhappy with your business ranking and online reviews:

 

Do you ask for customer feedback?
Do you implement changes based on the feedback you receive?
Do you monitor your online presence and reputation?

 

The answer to these questions is key to the future success of your business.

 

In the past it was cumbersome to get real feedback and even more so to ask customers to give you an online review. We have taken the pain out of this process. Give us a call today to not only improve your ranking and SEO but also improve your customer’s experience and loyalty.

 

 

linkedin reviewdriverFINAL
Krystal F. Burroughs
krystal@reviewdriver.com
Director of Client Happiness
Review Driver
(727) 218-9218

Stats Source Link: http://www.invespcro.com/blog/the-importance-of-online-customer-reviews-infographic/

 

 

Michael Monnot

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

https://infinitybusinessbrokers.com


How Does A Business Seller Get Top Dollar? It’s All In The Books



Unless you own an accounting firm, it’s likely that the record keeping and accounting parts of your business aren’t necessarily your daily top priority. You have a business to operate, employees to manage and inventory to sell.

 

However, if you are thinking about selling your business in the futurethose record keeping and accounting skills will be paramount in getting you the biggest bang for your business investment.

 

Handwritten accounting on the open pages of some old ledgers

 

How? Think about this point from a buyer’s perspective.

 

You are looking at two nearly identical businesses. They are in the same industry, in similar markets and locations and they generate the same amount of cash flow. The first business has immaculate records that stretch all the way back to the day they opened the doors – tax returns, P&L statements, inventory records, payroll records, the list goes on. When you as a buyer request records for this first business, they are already complete and organized and are handed over almost immediately.

 

For the second business, a request during due diligence for records gets you a poorly copied set of two years of tax returns and a box of receipts.

 

Remembering that these businesses are essentially the same in terms of cash flow, which one are you going to be willing to buy and which one will you pay more money for? The first business, right?

 

Why? You know what you’re getting. The history of the business, the current numbers, the contracts and leases – everything is right there for you to look at. There’s no guessing or lack of transparency. It’s all there on paper in black and white.

 

If this scenario has you instantly picturing the dusty box of receipts shoved under your desk – all is not lost. Getting your books in order may be challenging, but the return on the investment of time will likely be substantial. You want buyers to be looking at how well your business is doing, not wondering how someone so disorganized keeps the doors open.

 

If you need help, help is available. Your business broker can guide you and refer you to a CPA who specializes in making records useful during a business transaction. All you need to do is ask and be up-front about the condition your records are actually in.

 

Are you panicking about the box of disaster under your desk? Would you like to know what types of records business buyers are going to want to see? Please contact us at Infinity Business Brokers today 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

https://infinitybusinessbrokers.com


Independence in the Workplace: Your Employees’ Top Grievances



By Guest Contributor Jessica Trippler – www.BrinkResults.com

 

As we celebrate our nation’s independence, many working professionals wish they could muster the courage of our forefathers to make their own Declaration of Independence. Poorly managed employees have a valid list of grievances. Could your management style be stifling your company’s productivity?

Consider these common workplace grievances and learn how to foster independence which will strengthen employee morale while boosting your bottom line.

 

Office lady being scared because of too much paperwork to do

 

1. “I don’t know what’s expected.” Lazy management is not independence. You might think you are giving your employees freedom, but an approach which is too “hands off” will make them feel anxious. Give clear direction. Employees can’t hit a moving target and will grow weary of poorly defined or frequently changing goals. Don’t leave your people guessing about whether they’re meeting expectations.

2. “I’m sick of being micromanaged.” Mentor, don’t hover. Just like “helicopter parents,” managers who hover too closely will stifle creativity. Make yourself available to answer questions and check in regularly, but don’t breathe down your employees’ necks. Give them space to brainstorm and experiment. Employees will grow more confident and competent when they are given the freedom to explore. Demonstrate trust and expect failures. It’s all part of the innovation process.

3. “I don’t feel appreciated.” People need to feel a sense of purpose. This may be lacking in a workplace atmosphere so “free” that progress is never measured or rewarded. A lack of manager awareness means poor work and productivity alike will go unnoticed. Your employees will begin to wonder if their accomplishments even matter. Be deliberate about recognizing achievements.

4. “My ideas aren’t valued.” Don’t override your team’s decisions without proper consideration. The reason you hired these professionals is because they bring a diverse and valuable collection of competencies. If decisions are routinely vetoed by management, employees will stop innovating. Listen to and carefully evaluate new ideas. If you must veto, offer solid reasoning. You lose your employees’ respect when you presumptively dismiss their proposals.

5. “I’m always the last to know.” The workplace is a fast-changing environment. If managers don’t prioritize communication, they will cultivate disgruntled workers. Share information as quickly and authentically as possible. Schedule regular meetings so communication isn’t shoved aside by deadlines. Nothing is more frustrating than feeling you’ve wasted time and energy pursuing a defunct goal. Managers who are candid and communicative will reap their employees’ respect.

6. “I’m treated like a number.” Get to know your employees as individuals. Call them by name. Find out what makes them tick. You never want to overstep personal boundaries, but a little interest goes a long way in building trust. Share your own relevant career experiences and listen to employees’ ideas on how to improve the workplace. By establishing a safe environment for personal expression, you will strengthen employee satisfaction.

 

Managing right is the key to fostering workplace independence. Brink Results can help through targeted training, workshops and behavioral assessments like ProScan® , which empowers management to capitalize on employees’ strengths and motivations. This creates an environment which reduces stress while increasing morale.

Your employees will thrive in a secure, communicative workplace where independence is supported through clear direction, regular feedback and recognition of achievements.

 

 

 

Photo Jessica TripplerBrink Logo PNG

Jessica Trippler

Director of Sales
Hire Right. Train Right. Manage Right.
Brink Results, LLC
10060 Amberwood Road
Fort Myers, FL 33913
Office: 239.334.1050 Ext. 204
Cell: 201.563.2243
Fax: 239.288.2493
www.BrinkResults.com

 

 

Michael Monnot

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

https://infinitybusinessbrokers.com


The Art of the Negotiation: Tips for Business Sellers



If you are trying to sell your business, then you probably already know that one major step on your path will be the negotiation of a purchase price and the negotiation of the purchase contract.

 

If you’ve ever been involved with the purchase of a house or a car, then you already know a little bit about how the negotiation phase is going to go. A buyer offers a price, the seller counters – and after a bit of back and forth the deal is done.

 

The major difference with business sales? There will be many, many more moving parts. The best way to deal with these many moving parts is to prepare yourself for the negotiation process by following these tips.

 

Top view of african and caucasian men shaking hands after working with reports on laptops

 

Tip #1

Hire a business broker and use them as an intermediary.

With so much money changing hands and with the complexities of a purchase contract, having an intermediary like a business broker can keep the deal on track. Buyers and sellers will often offend one another unintentionally and kill the deal, so the best way to avoid this pitfall is to hire a broker and listen to their advice when it comes to matters of negotiation. The most important piece of advice you will get about the negotiations? Keep the broker in the middle. Any communication during the negotiation process should go through the broker. This is the only way to keep the opposite sides of the table from offending one another.

 

Tip #2

Don’t freak out over the initial offer.

An initial offer is usually lower than a seller would like it to be, and in some cases the offer is perceived to be so low the seller refuses to even begin to negotiate. If you are a seller, you need to put yourself in a buyer’s shoes. If you were trying to buy a business, you would want to get it for the least amount possible, allowing for more working capital the day you take the keys. Don’t take low offers personally, instead consider them a jumping off point for negotiations. A decent buyer will justify a low offer with points that you can address individually. Just remember that the initial offer, just like your listing price, isn’t the end of negotiations – it’s the beginning.

 

Tip #3

Keep your head in the game and your heart off the table.

Although your business might feel like your first-born child, please remember that it isn’t. It is an investment you are now cashing in. Strong emotional attachment brings issues with letting go, issues with being easily offended and issues with overvaluing the business. Keep a level business-head and try to keep your personal feelings in check.

 

Tip #4

Be 100% prepared for compromise.

One last and very important point to make regarding negotiations – the final purchase price and purchase contract will be a compromise for both sides. Go into this process understanding the reality that you are not going to get everything that you want, no matter what side of the table you are on. Many deals have died because one side (or both) refused to budge over something tiny, like the value of a piece of equipment or the closing date. Stay calm, patient and willing to compromise and you will have a far better chance of reaching the closing table.

 

Are you a business owner who is thinking about selling and want to know more about the process? Would you like to know what businesses like yours have recently sold for? Do you want to know what a purchase contract might look like for your business? Please feel free to leave any 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

https://infinitybusinessbrokers.com



Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

5111-E Ocean Blvd
Siesta Key, FL 34242

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

5111-E Ocean Blvd
Siesta Key, FL 34242




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