Don’t Think You Have What It Takes To Buy A Business? You Do!



 

When we chat with people and they find out what we do, the conversation usually goes something like this,

I would love to own my own business, but…(insert excuse here)

 

Sure, there are a myriad of reasons why going it alone and owning your own business may seem like a foolhardy venture, but the truth is entrepreneurship can be the key to happiness.

 

Why? When you own your own business, you are the boss of your day to day life. The amount of money you make, what you do for work – these things are now up to you. Talk to any entrepreneur and they will tell you that this kind of control over your own destiny is absolutely worth it.

 

Let’s look at some of the big excuses we hear about why buying a business is impossible and show you that all it really takes to be your own boss is a little planning and a lot of drive.

 

“I don’t have the money.”

Sure, there are a lot of businesses out there that only a multi-millionaire could afford, but the truth is the small business market is full of businesses that many people could absolutely afford to buy. Smaller ventures can be bought outright for cash from your savings, while some medium sized businesses can be purchased with a decent down payment and a bit of seller financing. Think of the money you would need to buy a business this way – you aren’t just spending the money – you are investing it in a business that will give you a return on that investment with some hard work on your part. You already go to a job and work hard for someone else, why not do that for yourself?

 

“It’s too risky.”

Yes, all business ventures come with their fair share of risk, but so does the job you have now. You could walk into work tomorrow and get fired. If you own your own business, any mistakes you make, any risks you take that don’t pan out will make you a better and smarter entrepreneur in the long run. Think ahead to your retirement. Are you going to look back at your working life, where you gave your blood, sweat and tears to someone else’s business, and wish you had taken the chance to work for yourself?

 

“I don’t know how to run a business.”

You’re right, none of us did at the beginning – but you learn fast. Think back about every boss you’ve ever had. How many times have you said to yourself “My boss is an idiot, if I were in charge I would…”. See, you do know some of what it takes to own your own business! The rest you can learn along the way. Talk to other business owners, read books, take a class – the know-how is out there if you are willing to find it. It is also a good idea to buy a business in an industry where you’ve already worked. That practical experience will serve you well.

 

The message here is if you’ve always wanted to own your own business, there is no such thing as an obstacle (or excuse) that you can’t overcome with some hard work and perseverance. Take the entrepreneurial leap, and you can soon be well on your way to business ownership.

 

Are you thinking about buying a business, but you’re not sure you have enough funds? Are you curious about what would be available? Ask us! Please feel free to leave us a comment or question here, and we would be happy to help you on your journey to entrepreneurship.

 

 

 

Michael Monnot

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

http://www.infinitybusinessbrokers.com


The No-Offer Business Buyer – Why Won’t Anyone Take Me Seriously?



 

If you’ve been looking for a business to buy for a while, you may have run into a problem that some buyers encounter – no one will take you seriously.

 

Maybe it’s your broker or the seller’s brokers that you have come across, maybe it’s the sellers themselves. Whoever it is, they don’t look at you as someone who is serious about buying a business. What they see is someone who is on an eternal search, and therefore someone who isn’t worth their time and energy.

 

How can you prove them wrong and show that you are a serious buyer? Make an offer.

 

“I don’t want to make an offer on every business I look at.”

 

Of course you don’t, and you shouldn’t. What we mean here is if you are seriously considering a business, the only way to know for sure if the business is going to fit your goals is to get to the due diligence process. In this process, you are allowed an in-depth look at all aspects of the business, from financial statements to contracts – then you can decide if it really is the right business for you.

 

“If I make an offer, I’m stuck with that business whether I like it or not, right?”

 

Absolutely not. If, during the due diligence phase you come across a reason why you don’t want the business – you will have the opportunity to back out of the deal before anyone reaches the closing table. The system is designed this way because businesses are inherently complex, so your ability to get a good look at what you’re purchasing is part of the process. Then and only then do you have to make a final decision about buying.

 

If you’ve been looking at businesses for an extended period of time without even entertaining the idea of making an offer, then don’t be surprised if brokers don’t take you seriously.

 

There are plenty of “tire-kicker” buyers out there who inquire about countless businesses – over enormous amounts of time – without ever making the move to buy one. On the other hand, serious entrepreneurs come on the scene with goals in mind, do a targeted search of available businesses, then make offers.

 

If you were working in the business market or trying to sell your own business, who would you take more seriously?

 

Are you a buyer who has trouble getting sellers to take you seriously? Do you have additional questions about why it is a good idea to put an offer on the table? Please leave us a comment or question here, and we will 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


Make More Money When You Sell Your Business: 2 Surprising Ways To Improve Your Bottom Line



 

Anyone who owns a business wants to make more money than they already do, but adding to your bottom line becomes crucial when you are considering putting your business on the market – now or in the future. A growing business will always be more appealing to a buyer than a business that isn’t, and surprisingly simple changes can help boost your numbers in this critical time.

 

It might seem obvious that one of the easiest ways you can boost your numbers is by cutting costs, but some costs happen so routinely that they may not even occur to you as an owner. For instance, what do you pay for your merchant services? These subscription-type services are something your business needs, but if you take a closer look you might find you are paying far too much. Services like these often contain hidden and unnecessary fees – and if you signed a contract for service you could be hit with a hefty cancellation fee if you find something better and want to switch. Do a bit of research to see if all of your recurring expenses are giving you the most for your money.

 

A second surprising way you can improve your bottom line is by keeping your inventory in check. How much inventory do you have on hand? What inventory control mechanisms do you have in place? Many small businesses don’t think they need inventory management, they just order new inventory when something runs low. Neglecting your inventory can have disastrous effects on your bottom line, however, because excess inventory eats up your cash. Excess inventory, especially inventory that probably won’t sell, can even decrease the amount of money you are able to get for your business. Keeping proper tabs on what you’re buying will keep you from ending up in a situation where you are sitting on a pile of inventory that won’t ever sell – and business buyers won’t want.

 

Cutting costs by minimizing unnecessary expenses and streamlining your inventory process can all add value to your business in the critical time before you sell. Even if selling is on the distant horizon, these types of changes will at least help your bottom line – so why not?

 

Have you thought about selling in the near future and have questions about the process? Would you like to know more about boosting your bottom line in the run up to a business sale? Contact us 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

http://www.infinitybusinessbrokers.com


The Latest Immigration News And What It Means For You



 

Both the 4th and 9th Circuit Courts of the United States upheld the hold placed on the travel ban earlier this year, but for different reasons. The Fourth Circuit Court ruled that the reworked ban violated the First Amendment – the amendment that prohibits the establishment of religion. The Ninth Court ruled that President Trump overstepped his authority because he made a decision about national security without adequate justification. The ban now heads to the Supreme Court where justices may decide to hear the case or may decide to delay it until the next session in several months.

 

If you are someone who is considering a move to the United States as a business investor – then it’s great news that yet another court upheld the ban. It shows that the incredibly restrictive nature of the new administration’s immigration policies will meet legal challenges on every front.

 

If you are looking to sell your business in the near future a continuation of the hold is good news for you too.

 

First of all, if your business is sensitive to the ebb and flow of the tourism industry, the legal pushback in the news tells the rest of the world that the U.S. isn’t such an intolerant place after all. Foreign tourism dropped off after the initial travel ban was announced, and this newest development might help to turn that trend around.

 

On the second front this hold might keep the administration’s attention away from such immigration programs as the EB-5 and the E2 – which many fear could be changed and restrict the amount of foreign-born entrepreneurs coming to the US. The backlash and legal maneuvering might also slow the administration’s push to limit immigration on other fronts that might effect the small business community for fear of further legal fights.

 

Resistance to the new immigration policies shows that the United States is not as intolerant of immigrants as the initial moves by the administration may have portrayed us. Continual resistance shows that no matter what the political climate we are unlikely to completely change our national identity as a country of immigrants based on one administration’s plans.

 

As to what the future holds – no one can be sure how the Supreme Court will handle the decisions of the lower courts. The fact that the lower courts upheld the bans for different reasons may make it more complex for the Supreme Court to hear and/or decide. For now, the best bet is to wait and see.

 

 

 

Michael Monnot

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

http://www.infinitybusinessbrokers.com


Seller Financing: The Business Buyer’s Guide



If you are in the market to buy a business, but don’t have a huge amount of cash available to make an all-cash offer, then the option of seller financing may be for you.

 

 

What is seller financing? This financing option occurs when a buyer brings a sizable down payment and the seller offers to finance the remaining balance of the purchase price.

 

Even though the economic picture has vastly improved from where it was a few years ago, many traditional lending institutions are still gun-shy about offering any kind of lending options for small business. Seller financing fills this gap between the all-cash offer and the difficult-to-get traditional financing options, however, the terms of a seller financing deal may have a smaller time period and higher interest rates than traditional lending would.

 

If you are a buyer who is going to need help with raising capital, there are a few things about the seller’s side of seller financing that you will need to understand and consider.

 

Most of the time you will need to bring a big down payment. Most (but not all) seller financing is for less than two-thirds of the purchase price, so at the very least a third of the price will need to be given as a down payment at closing. The seller is going to want a fair sized chunk of cash up front because once they sell the business, they are essentially out of a job and will be moving on to perhaps another business venture or retirement.

 

You will need to prove that you have the ability to keep the business running and profitable long enough to pay back your loan. You will probably have a hard time getting seller financing in an industry where you have little to no experience because a seller doesn’t want your learning curve to affect whether they get paid for their business.

 

You may have to put up a fair amount of collateral. The business itself we be collateral, in that that seller can take the business back in default. Also, a buyer can offer up personal assets like real estate if they choose to.

 

If you are someone with terrible credit, you may have a hard time getting seller financing. Any seller in their right mind will want to make sure that you have the ability to pay them back for all of their years of hard work, and a buyer with a good credit score will look far more promising than one without.

 

The price overall may be a bit higher and the interest rate might be a bit higher too, but what a buyer needs to remember is a seller has no buffer like a traditional lending institution would, this business is all they’ve got. If you have decent credit, a sizable down payment, know what you’re doing in the industry – but just can’t get traditional financing – then seller financing could be a very realistic option. The better you look as a lendee the more business choices will be available.

 

If this is something you might consider, you need to have the seller financing discussion with your broker early on in the game. This need will drive what businesses you should look at and which ones will be financially out of your league – there are sellers out there who demand an all-cash offer.

 

Are you a buyer who would be interested in seller financing? Do you have more questions about what information you would have to provide to a seller in order to secure financing? Ask us! Leave a comment or question here, and we will be happy to answer all of your seller financing questions.

 

 

 

Michael Monnot

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

http://www.infinitybusinessbrokers.com


Great News All Around: The Newest BizBuySell Insight Report



The newest BizBuySell Insight report is out – and the news is better than good.

 

The first quarter of 2017 saw record numbers, where closed transactions were up 29% from the same quarter of 2016. This jump has a lot to do with the booming economy, access to financing options and strong numbers within the small business community itself.

 

 

Both median revenue and median cash flow are at the highest levels since BizBuySell started tracking data back in 2007 and median asking and selling prices moved closer together – showing a stabilization of the market.

 

What does this mean for you? It means that the small business market is healthy and growing, although stabilizing forces will probably curb the record setting numbers of the 1st quarter and leave us with a year very similar to 2016 (which was a great year on it’s own).

 

If you’re thinking about selling or buying a business, now is the time to do so because the market is healthy, business financials are up and prices are fair.

 

Do you have questions about the health of the market in your industry or in the industries you are considering? Contact us today.

 

 

 

Michael Monnot

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

http://www.infinitybusinessbrokers.com


Why Business Owners Should Plan For An Emergency Retirement



 

Do you own your own business?

 

Smart business owners already have a long term exit strategy in place, like preparing to hand the business over to their children or planning to retire at a certain age.

 

Planning for your eventual exit is a good idea, but you should also consider an emergency exit plan. Ask yourself this question: What will happen to your business if you need to sell unexpectedly?

 

There are many circumstances where a business owner might need to walk away – like the illness of a family member or serious health issues of their own. If something comes along that will prevent you from sustaining your business, a pre-planned emergency exit strategy will allow you to walk away with a financial return instead of nothing at all.

 

I don’t need an emergency exit strategy, I’ll just follow my long term plan and sell when I’m ready.”

 

An emergency exit strategy isn’t complicated and it isn’t anything like a long term plan. It just means that you and a business broker take a look at your business through a buyer’s eyes and make any necessary changes now instead of during a personal crisis.

 

Why is it so important to look at my business this way now, when I have no intention of selling in the foreseeable future?

 

It takes, on average, 9 to 12 months to get a business from listing to closing. This time frame can be lengthened considerably by having a business that isn’t in ready to sell shape.

 

To avoid any lengthy delays you need to think about a buyer’s eyes long before you have any buyers coming through the door. For instance:

 

What can you do to boost your numbers?

To answer this question think about your current marketing strategy. Are you hitting all areas of the market that you could be? Are you fully engaged on social media? Have you had any recent promotions to try and boost business? If you answered no to all of these questions, then perhaps it’s time to refresh your marketing strategy.

 

Are your financial records in an organized and easy-to-understand format?

If you think about your financial records and your first mental image is a cardboard box full of crumpled paper – now is the time to sort that out. A business broker and a CPA who specializes in business transactions will be able to help you organize your records and teach you how to keep them that way.

 

Is the place in total disrepair or in serious need of a deep cleaning?

First impressions last forever, so if your equipment has seen better days or the floor is so dirty it smells – you’d better believe that a buyer will have serious second thoughts about the rest of your business. Anyone who lets the physical aspects of their business fall into such disrepair probably hasn’t had an eye on growth, right? Fix what’s broken when it breaks and make deep cleaning part of your regular routine.

 

If these questions resonate with you, now is the time to implement changes – not when an impending emergency is forcing you to sell. Talk to a business broker now, even if you don’t plan on selling in the foreseeable future, so you can know how to be ready when and if you need to be.

 

 

 

Michael Monnot

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

http://www.infinitybusinessbrokers.com


3 Questions A Business Seller Should Ask



 

When you are in the thick of selling your business, you will be answering buyer questions, broker questions, attorney questions, accountant questions…the list goes on. It is also important that you ask a few questions of your own, especially of the person who may buy your business.

 

What kinds of things should a seller ask a buyer?

 

The person buying your business will be taking over for you and hopefully continuing all of the hard work you’ve put in during your time as owner. It is important to find out a few things about this new person, especially if you are going to be offering seller financing. You will need to be able to trust that this buyer has what it takes to keep the business open long enough to pay you back. Here are a few of the questions a seller should ask any potential buyer:

 

Have you ever owned a business before? If yes, then what happened to that business? This question will help to establish that this is a person who knows the kind of commitment of their time and energy business ownership requires. If the buyer has never owned a business before, don’t be tempted to write them off. Many people have the drive necessary to own their own business. Remember that at some point you were a rookie business owner too. 

 

Do you have any experience in this industry? Why do you want to own a business in this industry? It is always ideal, although not absolutely necessary, to buy a business that is within your knowledge base because it allows you to start with experience under your belt instead of at the ground floor. This question will help you determine from the get-go what kind of training and consultation periods are going to be required for this buyer.

 

How do you plan to finance this business? Would you require seller financing for this business? Are you a cash buyer? These questions should have already been asked and answered by the business brokers involved long before your first meeting with a buyer, but it is always good to get an answer straight from the source, especially because circumstances may have changed since the question was last asked.

 

As you move through the process of selling your business, just remember that you have the right to ask questions too.

 

Are you a business seller who is curious about the kinds of questions a seller should be asking? Do you have questions about what kinds of answers you should be looking for? Please leave us a comment or question here, and we will be happy to assist you.

 

 

 

Michael Monnot

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

http://www.InfinityBusinessBrokers.com


When Do We Tell The Staff? Employees And Confidentiality



When a business is larger than a one-man shop, what the employees know about the sale of the business and when they know it are of major consideration and concern.

 

From a seller’s point of view, keeping the employees in the dark can be extremely important. Breaches of confidentiality about a business being for sale can lead to huge issues. There is a major concern that once the entire staff knows the business is for sale, it will be impossible to keep that for-sale status confidential for any future time the business is on the market.

 

 

Employees may also “jump ship”. This usually occurs within the lower-level employees – think servers in a restaurant or clerks in a retail shop. The typical fear is a new owner will come in and clean house or that the business is for sale because it is closing the doors for good.

 

What many sellers and their employees fail to realize is the jobs of critical staff are probably never safer than during the time frame when new ownership takes over. New owners need trained staff in place to keep the business up and running while they learn their new responsibilities. If you are a seller whose employees know the business is on the market, expressing the importance of those employees to a new owner can greatly help to calm fears.

 

For the buyer of a business, meeting the staff before deciding whether or not to buy the business may seem necessary, but there are usually very few instances where this will be able to happen. Lower-level staff will likely have to be met after the deal is closed, only because the seller will have to contend with losing that part of their staff if the deal falls through.

 

The employees a buyer will most likely be able to meet pre-closing will be key employees like managers and other staff members who are crucial to the operation and would be very difficult to replace. In most situations, the buyer will meet these employees only after all other aspects of due diligence have been satisfied and the deal is still moving forward. This protects the seller’s business from any damage that could be done by revealing the sale to the staff too soon.

 

The message here is that maintaining the confidentiality of the business sale will be paramount to the successful sale of the business, so both buyers and sellers will have to work together when it comes to the staff in order to keep everyone in place.

 

Are you a business seller who is concerned about your staff knowing the business is for sale? Are you a business buyer who feels they need to meet the staff before you get to the closing table? Please feel free to leave us a question or comment here, and we will be happy to address any concerns you may have.

 

 

 

Michael Monnot

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

http://www.InfinityBusinessBrokers.com


Dragging Feet And Tied Hands – Is It My Broker’s Fault?



As business brokers this has to be one of the most frustrating aspects of the job.

 

 

You have a motivated buyer who is very interested in a particular business and a decent offer is on the table. You request that the seller send over the information required for due diligence, like financial records, tax returns, etc.

 

Then you wait. And you wait.

 

Then the seller sends over partial records, which you forward to your buyers, but the rest of the information your buyers requested has yet to be produced. So you wait.

 

You get constant calls and emails from your buyers, and all you can tell them is you haven’t received the information from the seller so your hands are tied. The inevitable conclusion of this situation is the deal will fall apart and the buyer will move on.

 

Why does this happen?

 

Some sellers go on the market with the initial intention of selling, but once they are in the process, they realize

  1. that it can require a lot of work on their part to produce information and be available for questions/meetings, and
  2. they are shortly going to be out of a job.

 

This can cause some sellers to develop a decent case of cold feet. It can also cause a seller to be defensive, as constant requests for more financial information can give the impression that the buyer is trying to dig up dirt on the business.

 

This, of course, is not the case. Buying a business is a huge decision, and most buyers are going to want a thorough look at any business before they pull the trigger.

 

So how do you figure out if the problem is your broker or the seller?

 

If your broker is really good about answering your questions, is prompt with returning phone calls and emails and has been forthcoming about the issues they may be having with the other sidethen their hands are probably are tied. If it takes your broker ten days to return your phone calls, then yes, you might need a new broker.

 

As with everything in a business transaction, a good dose of patience will go a long way. This does not mean, however, that you have to sit around and wait for a seller to deliver information they have no intention of ever giving you. Talk to your broker if you have concerns about time frame issues, and understand that sometimes there really isn’t anything a broker can do to speed up the process.

 

Are you a buyer who is having a hard time getting information out of sellers? Are you concerned that the issue may be with your current broker and not with the seller? Please feel free to leave us a comment or question here, and we will be happy to assist you.

 

 

 

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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