how to sell a business Archives - Page 3 of 12

11 Steps to Business Failure in 2011

By Scott | February 11, 2011 - 9:35 am |July 17, 2013 business broker florida, buy a business, how to sell a business, Main, sell a business, selling my business, small business ideas, small business owner

How To Avoid Business Failure?

Find something that is working and try to make it repetitive. Find something that is not working and try to eliminate it before it brings further undesirable results.

I have a good friend that is an attorney and we would discuss business and he accounted his success to the fact that he consistently and diligently returned phone calls. To that I say What? Something so simple as just returning a phone call made you better than your counterparts? And the answer to that is yes. Not everyone does return phone calls or emails . So you can be better than the next guy by just returning phone calls.

To me this business practice is just a given, but I find to others it is more of an “optional service” that they provide. Sometimes the difference between success and failure is not some long winded algorithm or new gee-whiz technology, it is focus on the basics and do them right and do them consistently. Currently I am a business broker based in Florida and work with small business owners in the process of buying and selling businesses. I consistently find so many of the business issues I have had as a business owner are shared by so many other business owners.

Photo (c) theidgroup.co.uk

Tips For Steering Clear Of Business Failure

Do you want to have a better business? Do you want to improve your business? Then review the below list. If you are wondering what may be the fast track to business failure then use the below as a guideline:

Dont keep good track of your numbers and dont feel the need to really understand them. That job should be for others.
Dont return emails phone calls timely
Continue to delay your involvement with Internet marketing, social marketing and website optimization
Dont pay attention to existing customers and clients
Be willing to treat customers and employees improperly, as long as you the business owner benefit, and when you do something wrong to others that benefit you- assure yourself that its “just business”.
Dont take any time to review where you are spending your advertising/marketing dollars. Assume that even though you have not been getting results from your current efforts that if you do nothing long enough results will occur… eventually.
Dont embrace technology, continue to fight it and close your mind to “new ways”.
As a business owner dont take any time planning for a business exit strategy
Minimize the value of input from employees. You are the boss and because of that fact your way is the only way.
People say “either your business grows or your business dies”- dont believe that. Believe you have enough customers right now and that is good enough.
Dont worry about any long term planning. Long term planning is really a waste of your valuable time.

Like most list, this list as well can go on and on. Want to run a better business in 2011?

Its not Who You Know its Who Knows You

By Scott | January 31, 2011 - 6:52 am |July 17, 2013 business broker florida, buy a business, how to sell a business, Main, sell a business, sell a business florida, selling my business

Establishing The Right Relationships

We use various means to establish those relationships. When we make it our goal to grow our businesses by “getting out there and meeting more people”, that effort can be somewhat miss-guided. For every business person the needs are a little different. I help people buy and sell business. I strive to speak to more people that are considering buying a business.

I also prospect and market to reach small business owners that have an interest in selling their business. In some businesses the largest asset may be the production equipment, in others it may be their building they own, in my business as a business broker my largest asset along with my experiences may be my business relationships.

Actually to me the concept of Business Relationships has changed significantly over the last several years with the evolving of the internet and social media. And the definition of a business relation has become somewhat blurred.

“On Facebook I have 1800 friends”, “on Twitter 12,000 Follow Me and I follow 14,000” “On Linked-In I have 2200 Contacts”.- I actually dont have these sort of numbers but many of us know people that do. The real fact, at least for me, is that if I have to use all my fingers and toes to count my real friends I consider myself fortunate.

Photo (c) sheranescloset.com

Does Knowing People Mean That They Know You?

Do the 1800 Facebook friends know you ?, Do the 14,000 on Twitter know you?, Of the 2200 Contacts on Link-ed In , how many are going to shoot me an email when they want to Buy a Business or Sell a Business in Florida, or buy printer paper, or get my lawn service, or whatever my business offers?

As we strive to network and expand our sphere of relationships I recently got reminded of the actual goal of this effort , or rather what the end result of this effort should actually be. Very often I think thru my networking efforts, I want to meet people, when really what I want to do is have people meet me, get to know me. I know who President Obama is, I don`t really”know” President Obama. So I know of President Obama- does that help my business -no. But what if President Obama knew me or knew of me?

I know of Bill Gates-Microsoft. So what? What if Bill Gates knew of me? But from a practical standpoint, knowing the president of the small business right here on Main St is nice, but meeting him and striving to get him to know me, and when he and his friends are talking and one strikes up the all to common conversation of ” Do you know anyone who…..” can help me buy a business in Florida, this small business owner can say yes, I know this great business broker and his name is…

What Can I Sell My Business For?

By Scott | January 24, 2011 - 10:52 am |July 17, 2013 business broker florida, buy a business, how to sell a business, Main, sell a business, selling my business, small business owner

1 Comment

As a Business Broker Based in Florida, I talk with small business owners daily about their businesses. Reliable and usable information on the small business owner that is selling their business , buying a business, or contemplating a potential sale or acquisition is usually hard to acquire. What does the market for those selling a business in Florida and those looking to Buy a Business in Florida really look like?

Pricing Your Business

One or the benefits of owning a privately held corporation is that you are private. So information regarding small privately held small businesses that are sold and bought is both minimal and hard to obtain, because of the private nature of the transactions. I am a member of the Business Brokers of Florida (BBF) , which is the 2^nd Largest Association of Business Brokers in the World. I have for my own purposes reviewed and evaluated Business Sales Activity in Florida, (figures obtained via BBF websites) along with trends of businesses sold in Florida, Cash flows, and business values of those sold by members of the Business Brokers of Florida These numbers involves thousands of businesses over several years.

As I plan going forward, for my business broker activities, understanding these trends and activities is one of my 1^st steps in my planning process. Here are some figures and observations:

The number of businesses sold in Florida in 2010 were 5% less than 2009. The Price for a business was sold for in Florida in 2010 was lower than 2009. Both 2009 and 2010 were down years in the business acquisition and sales market in Florida. Most business brokers I speak to believe business acquisition activity will increase in 2011.

2010- 860 Florida Businesses Sold

Sales	Sold Price	Adjusted Net	Days on Market
592,931	232,120	107,427	222

2009 – 910 Florida Businesses Sold

Sales	Sold Price	Adjusted Net	Days on Market
594,449	270,327	106,251	233

More Restaurants are Sold in Florida than any other type of Business. Accounting for over 20% of all Florida Businesses Sold by Members of the Business Brokers of Florida. Do you wonder why so many restaurants sold? Currently, As of today- 693 Restaurants are for Sale in Florida thru BBF Members. !!

Restaurants 2010 Averages (187 Total Sold)

Sales	Sold Price	Adjusted Net	Days on Market
360,242	131,343	73,258	210

Restaurants 2009 Averages

Sales	Sold Price	Adjusted Net	Days on Market
361,493	162,087	72,703	211

It could just be me, but I do speak to a lot of business owners that “feel “their business is worth $1,000,000. Only 4% of all business sold in Florida thru members of the Business Brokers of Florida were greater than $1M. Florida business climate, while having some diversity, is very strongly service based with a lot of small businesses with 10 employee or less.

Businesses Sold in Florida for $1,000,000 or More (38 Total or approximately 4% of all sales)

2010 Averages (38 Total or approximately 4% of all sales)

Sales	Sold Price	Adjusted Net	Days on Market
2,739,402	1,894,700	576,038	378

2009 Averages

Sales	Sold Price	Adjusted Net	Days on Market
2,748,466	2,132,351	574,604	391

Please Note- and this is an important fact- the Days on Market does not included businesses not sold and ultimately taken off the market.

2010 was a difficult year in the business acquisition and sales market in Florida. Last Wednesday I attended an educational seminar that was attended by 70 plus professionals in the Florida business acquisition and business sales market. Generally most all I spoke to were both guarded yet optimistic about the industry prospects for 2011.

The above numbers speak to averages. All businesses and industries have their own uniqueness. Businesses generally are sold as a multiple of their adjusted cash Flow. ( adjusted cash flow attempts to determine actual cash the business generates for discretionary expenses, owner wages, debt service etc.) Each business and industry will demand a different valuation. Determining your business value may be dependent upon what similar businesses in your same industry are selling for as a multiple of adjusted cash flow. If you would like to know what businesses similar to yours are selling for, review a website such as mine, or contact a trusted business broker or other trusted advisor.

How to Sell Your Business for More

By Scott | January 14, 2011 - 7:41 am |July 17, 2013 business broker florida, buy a business, how to sell a business, sell a business, sell a business florida, selling my business, small business ideas, small business owner

1 Comment

At some point a business owner considers selling their business. Sometimes it is just a fleeting thought. Sometimes its a thought of “I don`t need this anymore, get me out”. Other times its a well planned out progressive process. You want to sell your business- how do you sell it for more.

This sounds like a fairly straight forward approach, but just as the selling of a business process can be very involved, the question of how to sell it for more firstly needs definition. I am a business broker based in Florida and speak to many many business owners about the potential sale of their business. I also sold my own business several years ago.

Selling Your Business When The Time Is Right

Just consider the simple analogy of having a rusty bike in the garage with flat tires that you want to sell today. You put it out at the end of the drive way put a For Sale sign on it- what do you think it will sell for? How can you sell that bike for more tomorrow than you can today?

Selling Your Business For More:

Selling your business for more can be a very good thing and very reasonable goal.
Trying to sell a business for more than it is worth can ultimately result in your business not being sold at all.
Setting the Goal today to improve your business, prepare it for sale so that it is worth more after your improvements is probably your best approach
Wanting to sell your business for more than “what you heard a local competitor sold for” can also be a mis-guided path.

Preparing Your Business For Sale

So selling your business for more is a reasonable and understandable goal. How do you get more for your business? Start today preparing your business for sale. Like so many of your other important business decision, prepare yourself a to-do list and systematically address those items. Below are some items you will want to include on your to-do list to help ready your business to sell for more. Ask and honestly answer these questions about your business.

How are your financials? Are there some unusual entries on your P/L that have escaped needed adjustment? Are all sales accounted for? Do you have a good clean P/L statement? For smaller businesses Do you have a P/L and Balance sheet?

How reliant is your business on you. What can you do today to help your company be more about your company and less about you.?

How documented are your systems, procedures, policies, pricing structure?

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Is your customer base as diverse as it should be? How reliant is your business on a few key customers. And again do those customers do business with you the business owner or with the company?

Do you have the opportunity to add recurring revenue streams to your business, but elected to not pursue? Do you have some contracted customers that you just haven’t updated contracts with?

Spend some time to meet with some of your trusted advisers. Dont rely on information you hear through the grapevine about this person selling their business for this amount. Talk to your attorney, your accountant , or visit with a business broker start to really learn the marketplace. Have you scraped the rust off your bike?, painted it ? oiled the chain? pumped up the tires? put an ad in the newspaper? on the Internet?- Is your bike worth more today than it was yesterday?

How do you sell your business for more tomorrow or next year than it is worth today? Start today preparing your business for sale.

Sell or Buy Business with goal of Hybrid Retirement

By Scott | December 29, 2010 - 9:37 am |July 17, 2013 business broker florida, buy a business, how to sell a business, selling my business, small business ideas, small business owner

Why not aspire to Hybrid Retire?

I personally think the majority of those currently working full days either employed or as small business owners look forward to the day they can retire, stop working, and spend the rest of their days fishing, golfing, or hobbies. Of course your age at the time of cashing in can greatly affect your decision process. If you are 75 years old, maybe you say enough is enough and just head to the golf course. But if you are fortunate to be successful and exit in your 40’s, 50’s or maybe even your 60’s your perspective, and needs could be greatly different.

The thought process for someone thinking of selling a business goes something like this:

I think I need to sell my business, walk away with $500,000 and that will be enough for me to retire. But what if you had someone that would buy your business and allow you to walk away with $400,000? Maybe this is a good time to entertain such an offer and consider Hybrid retirement.

Photo (c) yahoo.com

If you believe you need $50,000 per year to live off of, and the sale of your business may give you $35,000 to live off of, should you walk away or consider.? Many small business owners get overburdened with the responsibility of owning a business, and really want to sell those responsibilities away to others. Maybe making the $25,000 monthly payroll or covering the $100,000 per month fixed overhead cost month after month just gets to be too much.

Perhaps you can consider upon the sale of your business, you can find another business to buy, possibly one that you have aspired to do for years, or possibly work for someone, under terms conditions that fit your lifestyle. But this second business you don’t need to make that high monthly expense, and now you are supplementing the proceeds you have from your sale, and what you need to draw from the business is a lesser amount. “Needing” to make $15,000 per year instead of $50,000 can be somewhat liberating!

Why Hybrid Retirement?

Do you really know that you can “do nothing” after working for 20, 30, 40 + years
You have someone looking to buy your business near the price you think you need. maybe consider the offer and plan to supplement the difference with a second career, part time job etc.
This is an opportunity to build a profession around your lifestyle, whereas before you may have had to try to build a lifestyle around your business.
Are you really prepared to try to live off a “fixed income”- supplement that with something you aspire to do.

I think currently due to economic condition there are many small business owners delaying the exit / sale of their business because the recent performance of their company may not allow them to achieve the “walk away” money they believe they need to retire comfortably on. There also are eager entrepreneurs ready to start a new venture with hopes of one day selling and retiring off the proceeds. Maybe planning for both of the above scenarios can best be addressed by allowing yourself to consider Hybrid retirement.

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