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Selling A Business – Representations And Warranties

By on August 30, 2012 in ACROSS THE WEB - The Best Advice/Info About Selling Your Business From The Internet

 

We don’t like to get too deep into legal issues here – that’s what your lawyer is for. But it helps if you have a basic understanding of the legal issues so that you can talk intelligently with your lawyer about them. So when we find good information about the legal aspects of selling a business – and written by a lawyer – we pass it on. This article is an explanation of the different “Representations and Warranties” that can be part of a business sale. A representation is a promise that the things you say about your business (the way you “represent” your business) during the selling process are true. Most articles written by lawyers aren’t very clear – or instructive – for the business owner. But this one is good and I think it will help you understand some important legal concepts. http://www.jdsupra.com/legalnews/what-to-expect-when-youre-selling-your-30720/

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Selling A Business – A Perfect Example Of How To Get The Best Possible Price

By on August 29, 2012 in ACROSS THE WEB - The Best Advice/Info About Selling Your Business From The Internet, Dealing With The Buyer

 

Here is a unique article describing the ups and downs of putting the sale of a business together. It’s an email a seller wrote to his adviser documenting each of the events and upheavals that took place during the final week of the sale. Certainly no sale is easy or a completely smooth process. But what stood out to me is this: the seller had two buyers, each bidding against each other and thereby constantly driving up the ultimate price. This article perfectly demonstrates the advantage of having two buyers compete with each other instead of with you. If there is one thing that will get you the highest possible price it is finding a second, third and even a fourth viable prospect.  As we see in this article, the seller was continually surprised by the offers each buyer made. You never know if a buyer will up their offer, drop out of the sale or buy some other business. You can never rely on just one prospect because you never know what they are going to do. When you have one really good candidate to buy your business, the best thing you can do at that point is find a second prospect. Nothing will increase the motivation of the buyer and the speed with which they act then the existence of a second buyer – their competitor.

Here’s the article: http://www.exitplanninghelp.com/a-week-in-the-life-of-an-exiting-owner

 

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Reasons To Sell Your Business Now Instead Of Waiting

By on August 28, 2012 in ACROSS THE WEB - The Best Advice/Info About Selling Your Business From The Internet

Here is a quick little article by John Warrillow with a list of reasons why you might want to sell your business now instead of waiting for retirement. There isn’t anything on his list that would motivate me to sell my business, but I think it’s still a good idea to at least consider selling sooner rather than waiting for retirement. If you know why you are selling and what you plan to do once you have sold you are less likely to rush into making a bad deal or worse yet, wind up directionless after you have sold.

Here’s The Link: http://www.inc.com/news/articles/2010/06/sell-your-business-before-retirment.html

 

 

 

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Recasting Financial Statements Explained

By on August 27, 2012 in ACROSS THE WEB - The Best Advice/Info About Selling Your Business From The Internet, Preparation

 

This article by Kris Karlson is one of the clearest explanations of “recasting” that I have come across. I find that a lot of business owners are skeptical (or suspicious) of the recasting process. But it is actually a very straightforward and necessary process. The fact is that most small businesses are run in a way that minimizes taxes. So the true financial benefit of owning the company isn’t accurately reflected in the financial statements or tax returns. Recasting is just a way to show a potential buyer the true profit of the company. So if you have been confused by the recasting process (or if you don’t know what I’m talking about) I highly recommend reading his explanation of the basics. http://www.bowmanhanson.com/preparing-to-sell-your-business-recasting-financial-statements/

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What Goes Into The Sale Price Of Your Business

By on August 22, 2012 in ACROSS THE WEB - The Best Advice/Info About Selling Your Business From The Internet, Business Valuation

 

Here is a good article that deals with the reality of business valuation. Consultant Greg Caruso says that sellers need to realize that the value of their business is tied to what the market will bear, not the amount of blood, sweat and tears they have invested over the years. How many qualified buyers you have and the reason for their interest in your business is key to determining what the market will bear. Another good point discussed is that cash flow, not revenues is what is most important to buyers. If buyers have refused to pay your asking price and you are confused as to why, this is a good article for you to read.

 

Here’s The Link: http://www.nfib.com/business-resources/business-resources-item?cmsid=51590

 

 

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4 Ways To Grow Your Business So It Is Worth More To A Buyer

By on August 22, 2012 in ACROSS THE WEB - The Best Advice/Info About Selling Your Business From The Internet

 

There is no doubt about it – a business that is growing will sell for more than one that has stagnant growth. But how exactly do you envision this growth? Is it simply more sales? More Location? More employees? In this article business journalist Rhonda Abrams discusses four key elements of small business growth – and your vision for your company’s growth is the first element. Another important element of growth is your team. This is especially important when you go to sell the business because usually your team of employees will stick around after you are gone. Abrams suggest you get past the notion that there are jobs only you can do. The more you delegate to your team the more valuable your business will be in the eyes of a buyer.

 

Here’s the link: http://www.delawareonline.com/article/20120820/BUSINESS0701/308200002/Four-secrets-small-business-growth?odyssey=mod%7Cnewswell%7Ctext%7CHome%7Cs&nclick_check=1

 

 

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Increase The Value Of Your Business – Take The Vacation Test

By on August 21, 2012 in ACROSS THE WEB - The Best Advice/Info About Selling Your Business From The Internet, BUILDING A BUSINESS THAT A BUYER WILL PAY FOR

 

Here are five guidelines to help you determine if you are maximizing the value of your business. For many smaller, owner-managed businesses the 4th item – Could your business survive if you went on vacation? – may be the key question to judging the value of your business to a buyer.

For most business owners it is a real challenge to let go, to give their employees for freedom to manage things and to handle problems on their own. A business buyer wants to invest in a company; they don’t want to buy themselves a job. And that is exactly what the business owner has if nothing gets done without him or her doing it. If employees are in the habit of coming to you for the answer every time a question comes up you will need to wean them off that habit before you can sell for the best price.

Try this: from now on, whenever an employee asks you how to deal with an issue ask them, “How would you handle this is you were the owner?” This will develop the habit within your employees of thinking more deeply about their job and how things get done. Of course, you will also have to follow through and allow them the autonomy to do more without always checking with you first.

 

Here’s The Link to 5 Ways To Increase The Value Of Your Business: http://www.thickenmywallet.com/blog/wp/2009/09/30/how-to-increase-the-value-of-your-business/

 

 

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5 ways To Increase The Value Of Your Company

By on August 21, 2012 in ACROSS THE WEB - The Best Advice/Info About Selling Your Business From The Internet, BUILDING A BUSINESS THAT A BUYER WILL PAY FOR

 

It’s hard to get top dollar for your business if you haven’t been planning ahead these past few years. In this article, published by The National federation Of Independent Business, consultant Greg Caruso offers 5 ways to increase the value of your business now so that your selling price will increase. One of the key concepts “Remove Yourself From The Business” is probably the hardest for business owners to implement. But in the long run you will be much better off – and your business will be worth much more – if your business is not dependent on you for its day to day operation. If the business is totally dependent on you then the buyer is merely buying a job – not a business.

 

Here’s The Link: http://www.nfib.com/business-resources/business-resources-item?cmsid=52167

 

 

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How To Increase Your Company’s Value By Making Yourself Less Important

By on August 16, 2012 in ACROSS THE WEB - The Best Advice/Info About Selling Your Business From The Internet, BUILDING A BUSINESS THAT A BUYER WILL PAY FOR

 

In a new article by John Warrillow, published at Inc Magazine, he talks about how you can increase your company’s value by making yourself more replaceable. One thing that will really drag down the value of your business in a buyer’s eyes is if the business is totally dependent on you for its success. Think about it – if you are the driving force behind everything that happens at your business, what will the business be worth when you’re gone?

One simple recommendation Warrillow makes is that every time an employee asks you how they should handle some issue, ask them what they would do if it were their business. This will get them in the habit of thinking for themselves and ultimately they will be more productive and effective.

 

Here’s the link: http://www.inc.com/john-warrillow/stop-being-the-go-to-guy.html

 

 

 

 

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What Warren Buffet Has To Say About Business Valuation

By on August 16, 2012 in ACROSS THE WEB - The Best Advice/Info About Selling Your Business From The Internet, Business Valuation, HOW TO SELL A BUSINESS

 

Did you know that Warren Buffet thinks that business valuation is the most important skill business students should learn? In this article published by Forbes, business writer Steve Parrish makes the point that you need to understand business valuation –even if you hire a professional to do it for you. Understanding business valuation means you will always know what variables drive the worth of your business. This is important to know whether you are selling your business or just starting to build it.

I would argue that this point – you should understand the concepts even if you hire a professional – applies to all aspects of selling your business. If you hire a business broker to help you sell, you still need to understand the processes and procedures of selling. How else will you be able to communicate with the broker if you don’t have an understanding of how a business is sold? How will you be able to determine if your broker is telling you the truth?

If you understand how a buyer will value your business then you will understand where you need to concentrate so you can build that value.

 

Here’s the link: http://www.forbes.com/sites/steveparrish/2012/08/14/if-you-value-your-business-you-should-value-your-business/

 

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