Tip #97 – Is There A Minority Shareholder That Must Be Considered When Selling The Business?

If there is a minority shareholder in a business, he or she may need to be consulted before selling the company. It depends on the arrangement that was made. There may be a right of first refusal for the minority shareholder, or other provisions in a buy-sell agreement, or even timing issues to … [Read more...]

Tip #96 – Updated Technology In A Business Can Help Its Value And Salability.

We all know that technology is moving so fast it can be overwhelming. And it is impacting many businesses in a way that business owners just can't ignore. The business must keep up with the competition and the marketplace for its products or services. And when it comes time to sell the business, … [Read more...]

Tip #95 – Does The Business Generate Enough Cash Flow To Justify The Price?

Buyers will make an acquisition of a business only when it makes financial sense. There are a few ways to make that justification, but in general terms, the acid test is to compute the cash flow to cover debt service, a salary to the new owner, and a return on investment. A professional advisor … [Read more...]

Tip #94 – Is The Business Sellable, Right Now?

It is wise when starting and growing a business to have the objective of selling it someday at maximum value. That means that the company should be built with good profit margins, large available markets and the ability to grow for a long period of time. The products or services should have an edge … [Read more...]

Tip #93 – Why Use An Experienced Mergers & Acquisitions Professional?

Selling a business is usually not easy. It can be a complicated process because of all of the many elements to a business - location, leases, equipment, employees, receivables, payables, etc., etc. The price of a business is obviously important, but so are the terms - how and when the payments are … [Read more...]

Tip #92 – Business Valuations – Understanding “Add Backs.”

Business owners don't always understand how business valuations are performed, and they oftentimes don't agree with the number. They first need to understand how their company's cash flow is computed. It starts with determining the “Add Backs” - expenses that are added to the profits to derive … [Read more...]

Tip #91 – Does The Company Have A Customer Concentration Issue?

In many types of businesses, “customer concentration” can be a real concern, with a few big customers that make up a substantial portion of the company's revenues. Buyers, of course, are concerned that if any of those big customers leave after the sale closes, the Buyer is not getting the company's … [Read more...]

Tip #90 – Clean Up The Financials!

Business owners can manage their financials as they wish - within standard accounting principles. But when it comes time to sell their company, it becomes a whole new ball game. Buyers and lenders will scrutinize everything, especially questionable items on the financials. If there are items that … [Read more...]

Tip #89 – The Owner Of The Business May Not Be Ready To Retire

Many older business owners, for whatever reason, aren't willing to sell their companies. But businesses can go into decline without new ideas, new direction, and new energy. Not selling the company can be risky. Too many things can go wrong as the owner continues to age -- health issues, health … [Read more...]

Tip #88 – Explore New Worlds To Increase Revenues Of The Business

A company that is growing will get greater attention from buyers and show higher value. Business owners have to be creative in finding new ways to increase their sales. That could mean researching on the internet, going to trade shows or conferences or traveling to other markets to find what is … [Read more...]