Weighing Advice: How Business Buyers Should Deal With “Help”

Posted in Become a Business Owner, Business Broker Why & How, Buyers Articles

Published July 23, 2018

Everyone is an expert, right?

 

We all have that person in our life who talks confidently about every subject while knowing little to nothing about the things they speak of. They string together urban legend, conjecture and memes from the internet into what sounds like a coherent piece of genuine information when, in fact, it is nothing of the sort.

 

If you are thinking about buying a business and you’ve told the people in your life about this new pursuit, then these fact-free advice givers will come out of the woodwork. Everyone, at one time or another has considered what life would be like as a business owner – and as such almost everyone feels qualified to offer their entrepreneurial advice. You will get unsolicited advice from seemingly everyone: your brother-in-law, the mailman, your dentist, your neighbors. While everyone’s intentions are good – to help you – the information you are given should be taken cautiously. Even the opinions of those you trust, like a very close friend, should be taken within the context of whether or not they actually know anything about buying or running a business.

 

Take, for example, the rent payments on a waterfront restaurant. If you are considering buying a large waterfront restaurant, especially one in a desirable location, then you should expect the rent to be high. That high rent, however, when compared to comparable businesses in the same area will probably be right in line with what you should expect to pay. Also, a desirable location means more customers in the door – meaning you will be perfectly capable of paying that high rent so long as you don’t run the business into the ground.

 

What unfortunately happens to many new buyers is they mention this high rent rate to someone who knows little to nothing about either the restaurant industry or the area in question and they balk at the number, exclaiming “That’s ridiculous!!! Don’t buy that business!” when the opposite is true. It’s a great business and falls right in line with both the buyer’s budget and their goals for business ownership.

 

There are many, many examples of instances where bad advice has driven a buyer from a perfectly good business – particularly when discussing matters of price. We’re not telling you that you shouldn’t listen to the opinions of those you trust, we’re just saying that you should consider their expertise in the matter before you take their advice as doctrine.

 

Who should you listen to? Your business broker is a good source of information because they eat, sleep and breathe business transactions and a good broker will know their local industry inside and out. Your business broker is also a reliable source of information because it is in their best interest if you succeed in your new business. You may refer them the business owners or business buyers you meet if you are happy in your business decision, and when the time comes to sell they hope you will use them again. A great business broker gets a great deal if their business from referrals and repeat clients.

 

You should also listen to the advice of your business transaction attorney and your business transaction CPA (if you end up using one) as they too know the industry well.

 

Notice we said “business transaction” attorney and CPA, not any attorney or CPA. Your friend who practices labor law and your uncle who does accounting for a rental car company aren’t going to be able to give you good advice about buying a restaurant because that’s not what they do. It would be similar to asking your car mechanic his advice about whether or not you should undergo back surgery – it’s not his area of expertise.

 

The most important person you should listen to? Your own common sense. Take the information you gather from all of your sources, weigh the validity of their opinions based on their real expertise in the matter – and then decide for yourself. You are the one buying the business, not the peanut gallery, so if the decision makes sense to you then that’s all that really counts.

 

Are you looking at businesses to buy and getting all kinds of advice at the same time? Do you have questions about some of the advice you’ve already been given? Please feel free to leave your questions and comments 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

www.InfinityBusinessBrokers.com

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Buying Or Selling A Business? Don’t Underestimate Training

Posted in Become a Business Owner, Business Broker Why & How, Buyers Articles, Sellers Articles

Published July 2, 2018

Have you thought about what happens after the keys change hands and the buyer and seller walk away from the closing table?

 

The transaction process isn’t over yet – now the training period begins.

 

When a business is sold, part of the purchase contract will typically cover a training period of some sort where the seller will stay on with the business until the buyer can be sufficiently trained to take over the helm. This is an all-to-important part of the business transaction process, so it is in everyone’s best interest to keep the training period productive and amicable.

 

The best way to start the training period off right is to keep the negotiations during the sale process as friendly as possible. Both parties can do this by always using the business brokers involved as intermediaries. It might seem inefficient to always send questions or comments through a third party, but what starts as an innocent phone call to the other side can quickly devolve into a deal-killing fight. Keeping things friendly for the time period before your are stuck working together will make the start of training much easier.

 

If you are the buyer in the situation, it may be tempting to walk in on day one and completely change everything to your liking. This is a huge mistake for two reasons.

 

One, you shouldn’t make any changes to a functioning and profitable business until you know everything there is to know about the business. Then, and only then, will you know what parts of the business are making it profitable and successful and what aspects can be changed without causing any unforeseen damage down the line.

 

The second reason your should hold off on any changes is for the seller’s sake. The seller has a wealth of practical knowledge about the business you just bought, and it is absolutely in your best interest to get absolutely all of that knowledge before the training period is over. By coming in and changing everything, you are essentially telling the seller you don’t think anything they’ve done is worth learning about – a move so insulting that you will probably have an incredibly hard time getting any of that precious practical knowledge. Try to remember that this business was a huge part of the seller’s life, so treat them with a bit of compassion and wait until they are officially gone before you implement any big changes.

 

If you are the seller in the transaction, the training period can be difficult for a number of reasons. First, once you’ve left the closing table and the keys have changed hands, it can be very tempting to mentally check-out. This is a very bad idea, especially if your deal has seller financing involved (which many deals do). If you check-out and can’t properly train the new owner, the their chances of success (and you seeing the rest of your money) are probably not very good.

 

Another training pitfall for sellers is getting offended when the new owner wants to make changes. It can be extremely difficult to keep your emotions in check, but you must remember that this business no longer belongs to you, so the new owner can do what they please. Do your best to complete the training period amicably so that your business can carry on successfully without you.

 

Whether you are the buyer or the seller, it is critically important for the survival of the business in the long term that the training period happens – so do your best to work together.

 

Have you bought a business and the training period wasn’t what it needed to be for you to successfully take over? Are you selling your business and you have questions about what the typical training period will be like? Please feel free to share your experiences or leave us questions here.

 

 

 

Michael Monnot

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

www.InfinityBusinessBrokers.com

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Finding The Right Business: 4 Questions To Ask

Posted in Become a Business Owner, Buyers Articles

Published April 9, 2018

When you decide that the next step in your career is to buy a business and try your hand at entrepreneurship, there will be many decisions ahead of you. Possibly the most important decision will be what business would be right for you.

 

Yes, we know. Everyone who’s ever dreamed of owning their own business has a dream business in mind – but focusing on that business alone, without some careful thought, can lead to disaster down the road.

 

Why? Dreaming about owning a business and actually owning that business are two completely different animals.

 

Long before you look at listings, you need to ask yourself the following four questions so you can focus your energy on the right business – not a dream business.

 

 

1. What would you love to do?

Business ownership is a life-encompassing affair. You are going to work long hours, probably take less vacations and you will be on-call 24/7. The only way to mentally survive such a grueling schedule is to have a real passion for what you do. It has to get you out of bed every morning and push you through late nights. This is where the dream-business can be of some use. Why is it your dream business? If you’ve always dreamed of owning a cafe, but in those daydreams you aren’t making coffee – you’re sitting at a table going over numbers, this can tell you volumes about what kind of business you would actually enjoy (hint, it’s not a cafe).

 

2. What have you done before?

The learning curve of business ownership is a steep one, mostly because any mistakes can cause a severe change in your bottom line. Many budding entrepreneurs make the mistake of buying a business they know almost nothing about – and are then stuck both learning a brand new industry and learning how to be a business owner at the same time. You need to stick to your knowledge base and the skill set you already have if you want to be successful. Hate what you’ve done for work in the past? If escaping your current industry is the reason you are considering business ownership, then think more broadly about what your skill set includes. If you’ve spent the last decade working as a mechanic for an auto dealership, but you have a gaggle of old cars at home that you love to restore in your spare time – then perhaps an auto restoration business and not a standard garage would be for you.

 

3. How much money do you have?

Business prices can fall anywhere on the map, but there are some industries and some business sizes that will be off your list for financial reasons right out of the gate. You need to get your capital in line before you start seriously looking at businesses because the amount of money you have to spend will determine what you even get to look at. You also need to be honest with yourself at this stage and realize that a traditional loan is probably not going to happen, and even if seller financing is a possibility you will have to bring a substantial down payment to the table to get a deal done.

 

4. What would your local market support?

Although an extreme example, you wouldn’t start a water skiing business a hundred miles from the nearest body of water – but you get the idea. Some local markets just won’t support some types of businesses. You need to look at the local business market and do a bit of research on the industry you are considering. Is the industry growing? Have a large number of businesses in that industry gone out of business recently, or are they thriving? If your plan is to buy a business and change it to a different market, is that market already saturated or is there room to grow? Say your plan is to buy any small restaurant and convert it into a homemade donut place, but the town you are considering has ten Dunkin Donuts and five Krispy Kremes. Probably not the best market.

 

When you’ve asked yourself these questions and have a fair grasp on the answers, your next step would be to have a conversation about the right business for you with an experienced business broker. A good broker has been down this road many times, and can give you great advice on what the local market will support and ideas of businesses that would fit your skills and goals that you may not have considered. They can then show you the businesses currently for sale that would meet your criteria and you can find the business that is right for you.

 

Are you thinking about buying a business, but after reading this think that your “dream” business may not be right for you? Do you have questions about what industries your current skill set would apply to? Ask us! Feel free to leave us a comment or question here.

 

 

Michael Monnot

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

www.InfinityBusinessBrokers.com

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3 Reasons Why Buying A Business Is Better Than Starting One

Posted in Become a Business Owner, Buyers Articles

Published April 2, 2018

What’s the best path to entrepreneurship?

 

Most think of the startup in some suburban garage – but is that really the smart way to go? The short answer? Probably not. Buying an existing business, however, is typically the better route to business ownership. Here’s why:

 

1. Starting a business is a risky and expensive venture.

 

Startup businesses are tricky. You are testing new waters – with your concept, with your location, with your operating procedures, with a brand-new staff. In the unlikely event that all goes as planned and everything works in your favor, you will still need an enormous amount of capital to lease a new location, renovate that location to suit your needs, equip your location, buy inventory, pay for permitting and licensing – the list goes on. Then you will also need to have enough capital to sustain your business, your staff and yourself for the time frame it takes to start turning a profit, which can be several months or more.

 

If you buy an existing business, many of the risks and financial challenges of a startup have been removed. With an existing business, you are buying a proven concept, location, operating procedures, a trained staff – and in most cases a training period with the existing owner to get you on your feet. The amount of capital you need might seem substantial, but remember that it would be far more expensive in the long run to find, furnish, equip, stock and run a business with no history of success than to just buy one with that laundry list already complete.

 

2. There’s no such thing as a “startup business broker”.

 

One of the best parts of buying an existing business, especially if this is your first foray into business ownership, is you can have expert help along the way. By having an experienced and qualified business broker by your side you have expert advice to guide you through your business search and help you find a business that fits with both your goals and available capital.

 

Don’t see any businesses on the market that appeal to your entrepreneurial dream? Sometimes buyers have a specific type of business in mind, but the goals they have for business ownership would require that they end up in an entirely different industry. A conversation with a good broker will help you decide if the business you think you want to have is really the business you should have to get the kind of life you are looking for. If you are starting a business, you can seek advice from anywhere and everywhere, but there won’t be anyone to guide you in the same way a broker can if you buy.

 

3. A business you buy comes with everything you need.

 

Like we discussed before, starting a business means having to hire and train a brand-new staff, finding then leasing a new location, buying all the equipment and furniture, finding and purchasing inventory, and setting up licenses and permits – if you can even get them. An existing business comes with everything, including in most cases the former owner for a while (for a training period to help you learn the ropes). This will take an enormous amount of pressure off of you as a new business owner, allowing you to focus on learning your new business without all of the additional headaches that a brand new business would require.

 

If your goals for the future include business ownership, seriously consider buying an existing business instead of starting from scratch.

 

Have more questions about the differences between buying an existing business and starting one from scratch? Are you curious about what types of businesses could be right for you? Ask us! Please feel free to leave us a comment or question 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

No Comments »



Buying A Florida Business – We’ve Got More Than Beach Bars

Posted in Become a Business Owner, Buyers Articles

Published March 12, 2018

Florida is the sunshine state. We’re the home of palm trees, plastic pink flamingos, alligators and white sand beaches. We’re the place where anyone who spent their life in the cold north comes to retire.

 

 

We’re also the place where many inspired entrepreneurs dream of coming to buy a beach bar and spend their days absentmindedly running said bar from the comfort of a nearby hammock.

 

We totally get that dream. It sounds amazing, and it is amazing because it’s completely impossible. For starters, absentmindedly running a business is really just running that business into the ground.

 

You can, however, still have a piece of that Florida dream without having to buy a tiki bar that plays only Jimmy Buffett music.

 

You can have the nice weather and a plastic flamingo in your yard by buying a business that will actually help you achieve your goals. Goals like having more free time. Like making more money. Like following a passion. Like getting to spend more time with your family. You can achieve these goals because here in Florida we have far more than white sand and alligators. We have real people who lead real lives.

 

Do you know what real people need? Real businesses that don’t all sell margaritas. They need grocery stores, daycare centers, car washes, plumbers and roofers. They need pizza places and auto mechanics. They need all the goods and services that any community has to have in order to function – and you can be a business owner who meets those needs.

 

And you don’t have to start from scratch. At any given time there are a multitude of businesses for sale – businesses that have great numbers and can be your ticket to the life you’ve been dreaming of. Want to see a few? Try our business search here.

 

What type of Florida business would be right for you? It depends on a few key factors – factors you should discuss with and experienced and qualified broker so they can help you find the right business for you. For instance, what are your goals for business ownership? Do you want to make the most money possible in the shortest amount of time? Are you looking for a specific industry that is your passion? Do you want to have a more flexible schedule than your current job allows so you can spend more time with your kids?

 

You ultimate goal for business ownership coupled with the amount of working capital you have available and your prior work experience will help you determine what types of businesses might be right for you. You and your business broker can work together to look for businesses that meet your goals – and you might be surprised by what you find.

 

For instance, if your goal is to spend more time with your kids and you think you want a tiki bar – think again. The restaurant industry has notoriously long hours, especially in the evenings and at night. You might find that a small service company (like a pest control or home-watch business) where you set your own schedule will be far better for your work/life balance.

 

Talk to a business broker today about your goals and take a peek at what’s currently available. You can have the Florida dream – and the pink flamingo – without buying a bar on the beach.

 

Have you always wanted to buy a business in Florida and want to know what types of businesses would meet your goals? Would you like to know what industries are doing well in the areas where you’d like to live? 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

1 Comment »



3 Misconceptions About Business Ownership & Why 2018 Is Your Year To Make The Entrepreneurial Leap

Posted in Become a Business Owner, Buyers Articles

Published December 28, 2017

2018 is your year.

 

It’s New Year’s resolution time again, and although you might be thinking that 2018 is the year when you will finally lose that weight, get organized or spend less time staring at your phone – we all know that our resolutions have a way of dissolving before February rolls around.

 

If you really want to change your life, here’s a different approach. Buy your own business.

 

Business ownership can be tough, but so is dragging yourself out of bed everyday to go to a job you hate. Entrepreneurship, despite all of the challenges, is very rewarding. All of your effort benefits you directly. You get to do something you actually want to do for a living. You can, more or less, make your own schedule. Your destiny is in your own hands.

 

If it’s so great, why doesn’t everyone own their own business? Many people are deterred from the entrepreneurial path by some pretty powerful and pretty false misconceptions.

 

Misconception #1: You need to be a multi-millionaire to own a business.

Small businesses come in all shapes and sizes, so while there are businesses that only a multi-millionaire could afford, there are also lots of small businesses on the other end of the spectrum that won’t cost you more than you have while having real potential for growth with the right leadership.

 

Misconception #2: Business owners never get a day off.

Ok, so this one isn’t completely untrue, but while as a business owner you are always technically on the clock – it’s your clock. Need to go take care of a relative for three weeks? Need a day off to chaperone your kid’s field trip? You can. Smart small business owners put the right people in place so their presence isn’t necessary 100% of the time. They also utilize the digital world so they can work remotely whenever necessary.

 

Misconception #3: You need to be a business ownership expert.

We hear this one a lot. “I don’t know anything about owning a business.” Sure you do. How many times have you muttered under your breath because your boss was making a terrible decision? How often do you look at the way a company is run and say to yourself “if I was in charge…”. The only difference between someone who works in a particular industry and a person who owns a business in that industry is one took the entrepreneurial leap. You can too.

 

There was a time when small businesses were the only kind of businesses. Every major corporation started small. The entrepreneurial plunge shouldn’t be feared – it should be embraced. Make 2018 the year you changed your life. Buy a business!

 

Have you always wanted to buy a business but you don’t know where to start? Would you like to know how the business buying process works? Ask us! Please leave 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

www.InfinityBusinessBrokers.com

No Comments »



Don’t Be That Guy – Why Confidentiality Is Important To Business Buyers Too

Posted in Become a Business Owner, Buyers Articles

Published September 25, 2017

New buyers hate confidentiality.

 

We tell new buyers why confidentiality is important, but they are still frustrated by having to sign non-disclosure forms, having to wait to find out the physical location of a business and by having to visit businesses by appointment and then only after hours. We get it, it is tedious, but it is also extremely important.

 

Invariably we come across a buyer who deals with their frustration by breaking all the rules – by waltzing into a business during business hours and demanding the employees produce the owner so they can talk about the listing price, by telling their neighbors and friends what businesses they have toured – and confidentiality is suddenly out the window.

 

When you first enter the business marketplace as a buyer, the process by which you gain access to information about the businesses that are on the market might seem ridiculous at first, but those protections benefit you too.

 

When a business goes up for sale, confidentiality needs to stay in place.

 

What do we mean by that? We mean that the only people who should know that the business is for sale are the seller, the business brokers and attorneys involved and vetted buyers who have signed the appropriate non-disclosure documents. No one else should have access to that information.

 

“Why? I’m trying to make a major decision here, I need access to the business to see if I want to buy it or not.”

 

Yes, you do need access to information, and you absolutely will gain that access – but it needs to be done carefully to maintain confidentiality.

 

What can happen if confidentiality is breached? Clients go to a competitor, employees quit and take their regular customers with them, vendors cancel contracts and the community assumes that the business is for sale because they are moments away from having to close the doors. If you are trying to buy a business, you don’t want to take the reins in the middle of this confidentiality crisis. You want the business to be in good shape and in good standing with the community the day you take over as owner.

 

An important note here – the impacts of a confidentiality breach aren’t for the business and the seller alone. If you caused the breach, you can be sure that the legal repercussions included in your non-disclosure agreements will absolutely be enforced.

 

How can a buyer ensure the health of the business they are trying to buy? Be patient, and keep the information you learn about businesses currently for sale to yourself. Don’t be “that guy” who causes severe upheaval in someone else’s business. If everyone plays by the rules, businesses stay protected and buyers end up with businesses in great shape.

 

Are you a buyer who is frustrated by confidentiality? Do you have questions about why confidentiality is so important? Please feel free to leave a comment or question here, and we would be happy to assist you with your business buying questions.

 

 

 

 

Michael Monnot

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

https://infinitybusinessbrokers.com

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Business Buyers Beware: How Your Actions Can Keep You From The Closing Table

Posted in Become a Business Owner, Buyers Articles

Published June 21, 2017

Small business sales fall apart for a multitude of reasons.

 

Any time you are contending with someone’s life’s work and large amounts of money changing hands, there are bound to be challenges. The problems arise when those challenges are more than the deal can take.

 

As a business buyer, you may find that some reasons for deals coming undone have little to nothing to do with you, like if a seller suddenly decides they’d rather not sell, but there are some issues that have everything to do with your end.

 

Sure, buying a business is a huge investment, both of time and money, but a ridiculously over-cautious, inflexible and inexperienced buyer can sink a business transaction as fast as an unwilling seller. The key is balance and understanding.

 

Before you get anywhere near a closing table, you may need to do a fair bit of introspective thinking. Do you really want to buy a business? Sure, owning your own small business is the American dream, but it is not always the easiest way to earn a living. Entrepreneurs can work long and intense hours, so you need to be sure that you are ready for that part of being your own boss. If you have done the requisite self-reflection, now it is time to go looking for the right business for you.

 

This may seem like a silly thing to point out, but you should choose a business that is going to suit you in terms of expertise and ability as well as one you actually like. Buyers might think they want to move to a completely different industry from where their experience lies, only to find that they are completely overwhelmed by the prospect of essentially starting from scratch in a business they don’t fully understand. An example would be an ill-prepared entrance into the restaurant industry where a former accountant suddenly decides to buy a bar without ever having worked in one. Avoiding this pitfall is easy, pick something that matches your expertise. This is a great time to employ the services of a business broker to help you figure out what businesses would be right for you in terms of how much you are looking to spend, what kind of hours you are willing to work and what would suit your knowledge base.

 

Once you have found the right business, make a serious offer. Buyers who lowball sellers just to see how steep of a discount they can get will only end up insulting the seller past the point of no return.

 

Do your due diligence once you have a business that you are serious about buying, but realize there will be limits as far as what will be available to you. For instance, sometimes buyers ask for the same information over and over again, or buyers demand to meet all of the key employees before it is appropriate to do so. All this does is upset the seller. Lean on the expertise of your business broker to ensure you are getting what you need without unnecessarily overstepping your bounds. .

 

The moral of the story is you will need to be cautious, and you should be when you are making such a big purchase – but also realize that any business is going to come with a fair bit of risk. Don’t let cold feet get in the way of a great business opportunity.

 

Are you thinking about buying a business but have questions about the process or what business might be right for you? 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

 

2 Comments »



Buying and Selling Businesses: Deal Killers

Posted in Buyers Articles, Sellers Articles

Published May 4, 2017

Whether you are in the market to buy a small business, or you are a small business owner who is looking to sell, it is important to understand the reasons that business transactions fall apart in order to avoid this issue yourself.

 

 

Business deals can be destroyed by either side, so whichever side of the fence you are on, avoid these pitfalls:

 

The Buyer’s Side

 

As a buyer, you need to be sure that you really want to buy a business. Are you really ready to take on the responsibility and work that it takes to run a small business? Do you have the support of your spouse and family? Owning a business will mean sacrifices for your family too, even if it is just in terms of the time that you would be able to spend with them.

 

Another reason that buyers have trouble getting to closing is unrealistic expectations. Do you understand how businesses are priced? Do you understand the buying process? Many new buyers go into the process believing that buying a business is a lot like buying a house, but nothing could be further from the truth. Talk to a business broker about your expectations early on in the game, as it will prepare you for the realities of a business transaction before you get there.

 

Do some research on your own to be sure you understand small business ownership and operations. You will want a good grasp on small business ownership before you get to the closing table. You do not want to be faced with a crash course your first day as a small business owner. If you have any doubt in your mind, it might be wise to resolve those doubts before you begin the business buying process.

 

The Seller’s Side

 

Many sellers put their business on the market purely out of curiosity. They want to see what the market is like, and really don’t have any legitimate reason or motivation to sell. This is a big mistake, as it alienates any good potential buyers that come your way.

 

The major issue that keeps businesses on the market forever is the price. Many business sellers have completely unrealistic expectations about the price and the market for their business. Use a business broker to alleviate this issue, as they will be able to properly evaluate your business based on the current market.

 

In the same line as price, as a seller you may need to accept seller financing as a part of any potential deal. Although it does occasionally happen, most of the time buyers do not come to closing with all the cash up front. If you are serious about selling your business, accepting seller financing will get you more potential buyers than if you refuse to do so.

 

Another major deal killer is dishonesty. As a seller, you should not try to hide the negative aspects of your business from buyers, as they will likely figure these issues out on their own during the due diligence phase. Failing to disclose that the business is in bad shape, that there is a major competitor moving in, or that you are dealing with a serious environmental issue are sure fire ways to make a deal fall apart.

 

Be sure that all owners of the business are in agreement about the sale, and check with your business broker and attorney about any legal ramifications of selling your business. You will not want any legal surprises the day before closing.

 

Keep the Deal Alive

 

Business transactions are inherently complicated, so it is important to remember some key points. First, honesty is the best policy. Second, trust the judgment of your business broker. Third, keep your expectations in the realm of reality. Lastly, be patient with the process. If all parties are serious about getting the deal done, any potential problems can ultimately be resolved.

 

Are you a business buyer who has questions about the process to find and buy a business? Are you a business owner who wants to know when the right time to sell would be? Please 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

No Comments »



Do I Have To Sign A NDA (Non-Disclosure Agreement) When Buying A Business?

Posted in Buyers Articles

Published April 27, 2017

The short answer is YES. You absolutely do.

 

 

The NDA (Non-Disclosure Agreement) is a crucial step. It is a legally binding document that protects both you and the seller.  This agreement shields the seller from those who have no real interest in actually buying the business, and protects you as the buyer from a business that may seem fine from the outside, but is hiding major problems.

 

How?

 

In a business transaction, it is necessary for a potential buyer to see the financial records of that business, but a seller does not want to disclose such proprietary information to just anyone. If it is determined that you are a credible buyer, you will be given the opportunity to sign a NDA so that you will have access to the business’s information.

 

The NDA ensures that any buyer who is given access to the financial and/or proprietary information disclosed by the seller will not disclose that information to any party who hasn’t also signed a NDA. This is necessary to keep the for-sale status of the business confidential and protects the seller and the business from potential harm that an inappropriate disclosure might cause. 

 

The parts of a NDA are as follows:

  1. The location, name, and type of business.
  2. The length of the agreement, typically several years.
  3. A list of those who are party to the agreement.
  4. What information cannot be disclosed (like financial records, contracts with staff and suppliers, etc).

 

Any buyer who refuses to sign a NDA is usually considered to be unnecessarily difficult and any business broker worth their salt will refuse to work with you. The NDA keeps the business you are trying to buy safe from those posing as buyers and from the disastrous consequences of a breach of confidentiality. If you consider yourself a serious buyer, be prepared to sign the NDA.

 

Are you thinking about buying a business and are worried about the legal repercussions of the NDA? Would you like to know more about how the NDA is good for business buyers? Ask us! Please leave 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

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Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com

9040 Town Center Parkway
Lakewood Ranch, FL 34202



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