Pandemic Making You Question Your Life Choices? Why Now Is The Time To Buy A Business



It’s an uncertain time. A global pandemic, the closure of everything from businesses to parks and a constant stream of terrifying information. While we all hunker down for the foreseeable future, it might seem like current circumstances should put your future dreams on hold. 

 

Guess what? If your dream is business ownership – you don’t have to wait.

 

This time away from normal life might be giving you a chance to rethink well, everything. Are you really happy on your current path? Is there something you’ve always wanted to do but life got in the way? Have you always envisioned life as the owner of your own business, waking up each morning to do something you love instead of just punching a clock?

 

Maybe now is the time to have a conversation with a business broker about what types of businesses would meet the goals you have for business ownership. Then, instead of endlessly scrolling on Instagram you could be searching for the perfect business – the one that would set you on the path to the life you’ve been dreaming of

 

 

Think it’s impossible to buy a business right now because of Covid-19? Its not

 

Why? 

 

First, the buying and selling of businesses is the job of business brokers. Business brokers don’t have their own licensing category in terms of professional regulations – so they are licensed as real estate brokers. The good news is in most states real estate is considered an essential service, meaning business brokerages are currently operating albeit remotely

 

Next, the vast majority of the business buying process can be done without breaking social distancing guidelines. Business searches can be completed via your laptop from your couch. Conference calls and video meetings are always available, and quite frankly something we already do with regularity. Documents can be shared securely online. Business site visits can be done via virtual tour. Our brokers can even arrange in person contact or on site visits if absolutely necessary, as we have implemented protocols whereby appropriate social distances are kept in place, no one shakes hands and all common surfaces (like door handles) are cleaned both before and after. 

 

Make use of this time away from the day-to-day grind to decide if you really want your old life back once all of this is over. Spend your free time searching for businesses, talking to the owners of businesses you like and getting yourself on the path to business ownership. 

 

Have you always wanted to own your own business and this pandemic is making you question your life choices? Do you want to know what types of businesses are in your price range and would meet your goals for business ownership? Ask us! 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

www.InfinityBusinessBrokers.com


Business Sellers – The Pros And Cons Of Buyer Vetting



If you are selling your business you know the importance of keeping your sale under wraps. Confidentiality, both of the for-sale status of your business and of your business documentation (like bank statements, tax returns and contracts) is paramount. Your initial conversations with your business broker likely included discussions about how to keep confidentiality intact – by staying tight lipped around your employees, by keeping you business listing vague, by giving specific lists of individuals who should not be allowed to receive information, etc.

 

What about the buyers who will be privy to all of that confidential information? How do you decide the level of vetting they receive before finding out anything about your business?

 

 

The simple answer is the more buyers that get to see your business, the higher the likelihood that you will be able to sell. Using an industry standard NDA (non-disclosure agreement) and a good broker who will ask the right questions should be sufficient to screen the majority of potential buyers – but some business sellers want to take the screening process to the next level. 

 

Requirements like proof of financial capability and buyer background (such as industry experience or education) are things you as a business seller have the right to ask for – these are hoops that any buyer will eventually have to jump though anyway as the deal progresses. What you need to consider is in some cases putting all of the hoops at the very beginning, before the buyer even learns the name of the business – might drive some buyers away. 

 

There are some circumstances where a heavier vetting process would be necessary – for instance the purchase of a multi-million dollar business is going to require any potential buyers to prove they have the financial means necessary before access to proprietary information will be granted. For most main street small businesses this high-level vetting isn’t necessary. What is necessary is getting your business in front of as many buyers as possible. 

 

Heavy screening up front can be a double edged sword – so you need to have a frank and honest discussion with your business broker about why you think you need any “above and beyond” initial requirements, and then listen to their experienced advice about how to proceed. In reality less is usually more when it comes to initial vetting, and any business broker worth their salt is going to ask the right questions before disclosing your business.

 

As the seller, it is ultimately up to you who learns the for-sale status of your business, who gets to see your business documentation and in the end who gets to buy it. Ask lots of questions in your initial discussions with a business broker. Find out how they maintain confidentiality and what they recommend in terms of initial buyer vetting. Then use your best judgement to come up with a plan that makes you comfortable while staying realistic with the process.

 

Are you considering selling your business and think your circumstance calls for very rigorous vetting of potential buyers? Would you like to know more about how we maintain the confidentiality of our client’s businesses? Please ask us! Feel free to leave any questions or comments 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

www.InfinityBusinessBrokers.com


Buying A Business? How Much Of A Project Do You Want?



If you are in the market to buy a business – you probably already have a bit of an idea what you want. A dream industry, a long-sought location or a passion project turned entrepreneurial goal. 

 

 

Ok, great – you know what you want. That’s step number one. Now, the questions get a bit harder.

 

Once you enter the business search process, you will likely find a number of businesses that might be a good match. How do you decide which one is the right one?

 

Here’s where a big factor comes in, one you may not have considered.

 

How big of a project do you want? 

 

What do we mean by that? Like anything in an open market, businesses can run the gambit from wildly successful and exquisitely organized to lightly congealed and barely successful. Circumstances from even the far ends of the spectrum could end up a great buy for a particular buyer you just need to decide where you want to fall on that spectrum. A wildly successful and exquisitely organized business is going to probably cost a lot up front – but you won’t have as much of a project to contend with. Similarly, the opposite end of the spectrum will get you a business for a great price – but you might need to do a lot to get that business to a good place.

 

To decide where you fall on that spectrum, think about what your goals are for business ownership. If you have a bit more capital to invest and are looking for something stable – look for businesses that have great numbers, great reviews and many years of existence. If your goal is to make the most of your money and you like a challenge, then something nearer the barely successful end of the spectrum might be right for you. A bit of effort – some re-branding, a few staffing and protocol changes, perhaps some remodeling, a marketing plan, retooling of customer service – these are the things you may have to do to get a red-line business back in the black. An entrepreneur who wants a serial-entrepreneur lifestyle (one where you buy a faltering business, grow it to a certain metric and then sell for a profit before finding your next venture) would be well-suited for this lower end of the spectrum.

 

How can you decide how much of a project you want? Think about what will make you happy day-to-day.

 

Do you want to just go to work and keep it simple, or are you someone who would be bored with that and needs a challenge? Once you decide, talk to an experienced and qualified business broker. Discuss the amount of capital you are willing and able to invest, as well as your optimal project-level. They will be able to take this information and find businesses that will be a good fit.

 

Are you considering buying a business but hadn’t considered how much of a project you are willing to take on? Do you need help finding a business that will fit with your goals for business ownership? Ask us! Leave any questions or comments 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

www.InfinityBusinessBrokers.com

 


Are You Being Ignored? 3 Ways A Business Buyer Can Stand Out From The Crowd



 

There are a lot of potential business buyers out there. So many, in fact, that around 90% of people who talk to brokers and sellers about purchasing a business never do. What does this litany of tire-kickers mean to the 10% of buyers who actually want to and will buy a business? It can be really difficult to get anyone to take you seriously. 

 

How do you pull away from the pack and let the other side know you’re for real?

 

Be Upfront

Business brokers get calls every day from prospective buyers, but what you as a buyer need to realize is the 90% have muddied the waters. Most business brokers aren’t going to give you the time of day if it appears to them like you aren’t serious – it isn’t worth their effort or energy. Your initial conversations with a broker will be a vetting of sorts, where you will be asked about the amount of capital you have available to invest in a business, your work experience and your goals for business ownership. If you are evasive or vague with your answers, it will immediately send up red flags for the broker. Someone who is serious about buying a business will be forthcoming with the amount of capital they have because it would be foolish not to. They will also be willing to talk about their experience and goals because that’s the only way a broker can really help someone get the right business. Why would you waste your time as a buyer looking at businesses you could never afford or are completely ill-prepared to own?

 

Don’t Drag Your Feet

One of the most important qualities an entrepreneur must have to be successful is the ability to be decisive. Eternal back-and-forth “I want this business, I don’t want this business” conversations will never get you any closer to your goals of business ownership. It will also do nothing but frustrate the sellers and brokers involved. Once you have the necessary information, make a decision and stick to it.

 

Be Realistic

There is no such thing as the perfect business, so constantly passing on businesses because they didn’t have perfectly organized records or because the decor didn’t suit your style means you aren’t really sure you want to buy a business. You are buying cash flow, not furnishings and paint colors, so you need to be looking at businesses from a big-picture perspective. You also need to make realistic offers. Coming in with an absurdly low offer tells the seller you have no interest in a real negotiation, and if the offer is bad enough you stand the chance that the seller will refuse to work with you at all.

 

The message here is if you are serious about buying a business, then you need to take the process seriously and show the brokers and sellers involved that you are ready and willing to put together a realistic deal. By showing your intentions through your actions, you will be able to differentiate yourself from the sea of buyers who will never make it to business ownership.

 

Are you looking at businesses to buy and it feels like no one is taking you seriously? Would you like to know how to put yourself in the 10% category? Please ask us! Leave any questions or comments 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

www.InfinityBusinessBrokers.com


The Paperwork Series: The Licensing For Business Buyers



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 the paperwork, contracts and red tape required for buying a business are totally do-able.

 

You just need to stay on top of requirements, have patience and have the right help.

 

 

The last (and possibly the most aggravating) part of the paperwork you will come across in a business transaction has to do with the licensing involved when starting or running a business.

 

A very important note on licensing – you absolutely must have all your licensing in place before you take over as owner of the business. Any procrastination on your part will probably lead to major issues. Any procrastination on your business broker’s part could also be a problem. Any good business broker should be helping their buyers wade through the paperwork jungle. Some brokers leave their clients high and dry, postponing important licensing issues until the last minute. Your broker should be helping you get the information necessary to get the proper licenses and permits. If they aren’t, you might need to find better help.

 

Your licensing requirements will depend on where the business is located, what goods or services it provides and your role in the business itself. For example, a small pizza shop that does not serve alcohol will have to comply with licensing requirements from the Division of Hotels and Restaurants but not the Department of Alcohol, Tobacco and Firearms. If you are buying a contracting business, you may need to have the appropriate contractor license for your state. Each state, county and city will also require specific licensing requirements depending on what the business is and where it is located in relation to state, county and city boundaries.

 

Just like all of the other paperwork requirements we have discussed in previous articles – this is a great example of when a business broker is worth their weight in gold. As we already mentioned, any good broker should be helping you with licensing requirements or referring you to a licensing professional. They should also be advising you on when each part of the licensing process should be started and when it needs to be complete.

 

If you don’t want to pay the fees of a licensing professional, you should know that it is absolutely possible to do your own licensing – but it will take a good dose of patience and plenty of perseverance.

 

The best advice is to get all of the necessary licensing information from the seller (through your broker) and then go through each licensing requirement one at a time. You should print all applications regardless of whether or not you will be submitting them online as many government agencies have time-out procedures on their websites (so if you take too long to fill out your application online it will time-out and you will have to start over). Printing the applications allows you to fill everything out beforehand so you don’t have timing issues. You should also have everything in printed form and kept together because in many cases an application will require approval and signatures from multiple agencies – so it is best to take everything with you.

 

You should also understand that all government agencies are very large bureaucracies, and as such the red tape involved can be extensive and open to interpretation. What do we mean by “open to interpretation”? If you have a question on one part of a specific application, you might call one day to get an answer. The next day, when you speak to someone else in the same office, you might get a completely different answer. Although frustrating, this difference in opinion is totally normal. Just follow the instructions of the government agent you are currently dealing with, and try to deal with that one specific person every time (not always possible).

 

The best way to deal with licensing? Ask questions, lean on the experience of your business broker and stay on top of deadlines.

 

Do you have more questions about the licensing requirements in a business sale? Would you like to know more about what’s included? Ask us! Feel free to leave any questions or comments 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

www.InfinityBusinessBrokers.com


The Paperwork Series: The Commercial Lease For Business Buyers



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 the paperwork, contracts and red tape required for buying a business are totally do-able.

 

You just need to stay on top of requirements, have patience and have the right help.

 

 

As you near your closing date, you will also be nearing the day when you sign your commercial lease. Almost all business transactions are for the business itself – not for the associated real estate, so in almost all cases you will be dealing with a commercial lease when you buy a business. The timing for signing your commercial lease will be one of the clauses mentioned in your purchase contract.

 

Navigating the negotiation of a commercial lease and acting as a buffer between buyers and typically difficult property managers is yet another example of why a good business broker is instrumental in the success of a sale.

 

Property managers are difficult by nature because it is their job to protect the owner of the property from anyone who might not be able to pay the rent. Businesses, especially small businesses, are inherently very risky – so many property managers are hesitant to allow new owners to take over the lease at a location. You should expect a thorough vetting process, and should be prepared to disclose your financial statements and your resume. Your new landlord wants to make sure you have the experience necessary to keep the business successful and the capital to pay the rent during the transition to new ownership.

 

The inherent risk of small business also means you should expect that your lease will be essentially the same price as the lease the current seller is paying. Most property managers are not going to renegotiate for a much lower price. Why not? Keeping the current tenants at their current rate means more money for the property owner, so be ready to pay essentially the same rent (if not more).

 

Commercial leases are similar to the purchase contract because they are very extensive. You should review them carefully with your business broker and your business transaction attorney. Just like your purchase contract, any attorney unfamiliar with the business transaction process will be hesitant to advise you to sign a commercial lease simply because it is so extensive. Listen to the advice of your business broker and your business transaction attorney as they are best suited to advise you in this situation. Also be aware that most commercial leases are fairly standard, so although you may be able to negotiate some small parts of your lease – it will largely stay as it was for the original tenant.

 

Do you have more questions about the commercial lease in a business sale? Would you like to know more about what’s included? Ask us! Feel free to 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

www.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




Search



Recent Posts

Categories

Archives

Tags