The Biz blog» Manufacturing

Keys to Selling Your Business

Kendric Foultz — Tue, 24 Jan 2012 23:23:51 +0000

Knowing what a business buyer wants is the key to selling your business and getting the best price for it. In this market climate, most buyers are looking for two things, a cash flowing business and a deal. Here are a few things that a business buyer is gong to want to know that will allow the buyer to asses the situation and determine if yours is the right business for them.

• Is the business currently producing an income for the owner?
• Is the business seller retiring and fully funded his or her retirement plans? • Does the sale of the business only represent a small part of the retirement portfolio?
• Is the business debt free?
• Do the financials show that the depreciation schedules are completely exhausted?

Affirmative answers to these questions tell the business buyer that the business is making enough money for their needs and you are indeed in a financial position to sell your business and sell it within the constraints of the marketplace.

Another thing that a buyer is going to want to know about is your plan for the future. Nobody wants to get to the closing table only to have the owner decide that he or she wants to keep the business. Equally, nobody wants to buy a business only to find out that you’re going to open a competing business. This is why buyers like sellers that are clearly of retirement age and means. If your business is complex or highly personal in nature, a buyer may require that you stay involved in the business for a period of time to provide a seamless transition. If you have dreams of selling your business and moving to the Caribbean, this might be achievable. You may only have to adjust your time line a bit.

Now that you know some of the keys to attracting a buyer for your business, the next step is to find the right buyer for your business. To do that you’re going to want someone to help you who understands business buyers.

Kendric Foultz is a certified business broker with decades of experience in deal making and working with business buyers and sellers. Feel free to give him a call regarding your business related issues at 310-968-2369.

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Why isn’t my business selling?

Kendric Foultz — Fri, 21 Oct 2011 15:37:24 +0000

Almost nothing is as upsetting to a business owner than listing their business for sale and then having it sit on the market for months with no activity on it! “What is wrong, why haven’t you sold my business” you ask the business broker. The answer might be complex or very simple. The best thing to do as a business seller is to ask yourself a basic question. “Does this offering make sense? Would I buy my own business as presented?”

Put yourself in the Buyer’s shoes and price your business accordingly. First of all the asking price and terms have to make financial sense relative to the historical earnings of the business along with future positive outlook for the business and its industry. In a great many cases, it’s the asking price that is preventing the sale. Next take a look at the terms. If the business has been approved for SBA financing then terms shouldn’t be a problem. If the sale doesn’t qualify for outside financing and the seller wants more than 50% down payment then you are likely to have a problem. Ask the business broker to show how the business would cash flow for a new owner.

Goodwill will likely be the most valuable element of your business. A credible Confidential Business Review will substantiate the value to a Buyer and increase the likelihood of getting a reasonable offer. Make sure that the business broker has been able to create a Confidential Business Review of the business that paints an accurate picture of what is going on with your operation. There should not be any significant gaps that would cause a serious buyer to wonder why relevant information is not included. That is one of the best ways to turn off a good buyer. While no two businesses are exactly the same, they do share many common elements and the buyers want to compare these elements from business to business.

Finally, make sure you’re getting the word out to the right buyer. Have a complete understanding of what the business broker is doing to market your business. Sometimes an owner will know of something that would help the marketing efforts of the broker and should let the broker know right away. This might be something like a particular trade journal or industry conference. Don’t forget that this is a team effort.

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Jered Chapman joins BizEx Business Brokers in Marina Del Rey

Jered Chapman — Tue, 28 Jun 2011 18:02:44 +0000

MARINA DEL REY, CALIFORNIA (June 21, 2011) – BizEx is pleased to announce that it recently welcomed Jered Chapman as the newest member of its team of business brokers.

Jered brings years of business experience to BizEx. Following a successful career as a college coach, he began overseeing operations and consulting with various companies and organizations in Philadelphia and Los Angeles. He has worked with business owners in various industries, including restaurants, night clubs, health clubs, sports apparel retail, graphic design, and distribution centers. Jered’s background emphasizes his knowledge in business development, operations management, and consulting. He is a skilled communicator and project manager, helping clients understand the business selling and buying process.

As a BizEx Business Broker, Jered provides all relevant services business owners and business buyers require to be successful in the buying and selling of a business including: valuing businesses, marketing and listing businesses for sale, the creation of Confidential Business Reviews, pre-qualification of businesses for SBA business acquisition loans, working with Buyers to identify acquisition targets in relevant industries and facilitating transactions.

BizEx is a Los Angeles Business Broker providing M&A Quality Services for Small Business Owners. We leverage our Technology and Expertise to Simplify & Expedite the Buying and Selling of Businesses. In the buy sell business transaction, matching the right Buyer with the right Business is how we define success.

“We are happy to welcome Jered Champan to the BizEx team. Jered brings prior Business Brokerage experience and excels in the project management, coaching, and communications elements of the transaction, which are core qualities of service in the business sales industry.” –Michael S. Davidson, founder of BizEx

“I selected BizEx after having worked with other brokerages in the past. I can aptly say that Michael Davidson brings professionalism that no other brokerage I have encountered can rival. His sophisticated and comprehensive approach to the business sale and acquisition process allows brokers the resources to spend more time assisting our clients. I am excited and honored to join Michael and the impressive group at BizEx.” –Jered Chapman, Business Broker

Jered’s profile can be read at http://www.bizex.net/business-broker/jered-chapman. He can be reached by email at jchapman@bizex.net or by phone at 310-882-2200 Ext. 129.

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5 Essential Items to Sell Your Business Quickly

Dan Munter — Thu, 03 Jun 2010 19:34:22 +0000

As a business broker and as a former business owner, I know that the decision to sell a business is not easy. But once it is made, I know that usually the seller wants to sell it as soon as possible.
I always tell a seller to pretend that they are the buyer looking at buying their business. What would they need to see to decide to buy the business? From my experience and my logic, I have come up with a list of 5 items that really facilitate the selling process.
1) Have credible P&Ls for the past 3 years.
2) Have financial records to verify the value of the inventory and FF&E
3) Make sure that the key employees will stay employed
4) Make sure that the landlord is willing to lease for reasonable terms
5) Make sure that the key customers will continue to buy services or products.
There are of course other items that are necessary. However, if a seller can provide the 5 items mentioned above, not only will it be easier to find a buyer, but it will make the due diligence process go much quicker.
Blog by Dan Munter, a business broker with BizEx. I can be reached at 310-882-2200 ext. 121 or www.bizex.net

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