Questions Business Buyers Want Answers To

If you are even thinking about selling your business, it’s important to know the questions that buyers generally want answers to. For example, the first question almost always asked by buyers is: If this is such a good business why is it for sale? How you answer this question can make or break a sale. A vague answer can discourage buyers from further consideration of your business, as they may assume the worst. If you say you are “burned out” or just ready to try something new – that’s fine. If you’ve owned and operated the business for 10 to 15 years, buyers will most likely accept your reason for sale and continue their investigation. However, if you’ve only owned and operated the business for two years or less, a prospective buyer may find it concerning that you are already burned out or ready for something new. If you’re sick, be open about what the problem is; otherwise buyers will think you are just sick of the business. The worst thing a seller can do is to fudge an answer or … [Read more...]

Selling Your Business? Do-It-Yourself is Risky Business!

When the owner of a business makes the decision to sell, he or she is taking a giant step that involves the emotions as well as the marketplace, each with its own set of complexities. Those sellers who are tempted to undertake the transaction on their own should understand both the process and the emotional environment that this process is set against. The steps outlined below are just some of the items for a successful sale. While these might seem daunting to the do-it-yourselfer, by engaging the help of a business intermediary, the seller can feel confident about what is often one of the major decisions of a lifetime. 1. Set the stage. What kind of impression will the business make on prospective buyers? The seller may be happy with a weathered sign (the rustic look) or weeds poking up through the pavement (the natural look), but the buyer might only think, “What a mess!” Equally problematic can be improvements planned by the seller that appeal to his or her sense of aesthetics but … [Read more...]

What a Buyer May Really Be Looking At

Buyers, as part of their due diligence, usually employ accountants to check the numbers and attorneys to both look at legal issues and draft or review documents. Buyers may also bring in other professionals to look at the business’ operations. The prudent buyer is also looking behind the scenes to make sure there are not any “skeletons in the closet.” It makes sense for a seller to be just as prudent. Knowing what the prudent buyer may be checking can be a big help. A business intermediary professional is a good person to help a seller look at these issues. They are very familiar with what buyers are looking for when considering a company to purchase. Here are some examples of things that a prudent buyer will be checking: Finance Is the business taking all of the trade discounts available or is it late in paying its bills? This could indicate poor cash management policies. Checking the gross margins for the past several years might indicate a lack of control, price erosion or several … [Read more...]

Do You Have What It Takes to Find Success in the 21st Century?

The times they are a-changin'.  The COVID-19 pandemic has given new meaning to Bob Dylan's almost 60-year old line, as it has caused shifts across many industries and made clear that many industries will never return to the old normal. Success in the 21st century will require a good deal of adaptation and the ability to evaluate where you stand today and where you need to be tomorrow. Flexible Thinking One of the cornerstones of being successful in both life and business is to think flexibly.  A flexible approach to problem solving can lead to finding new and highly effective ways of tackling them. Success in the 21st century is much more than simply riding the next technological wave or trend.  Instead, it is about being amongst the first to use creative thinking to spot trends and developments ahead of the competition and exploit them first.  A Solid Plan Having a plan is essential for success.  This aspect holds true today, as it did last century and those before it.  As … [Read more...]

Selling Your Business? What You Should Know.

No doubt selling your business is one of the most complex and important decisions you’ll ever make. Your business likely represents decades, or even a lifetime, of dedicated work. Here, we examine some key steps you should take when it comes time to sell. One of the most important steps is to begin the sales process well in advance of the date that you plan to put the business on the market. Working with an experienced business broker or M&A advisor is one of the best ways to ensure that you’ll be ready to sell your business when the time comes. It will also help you to avoid the numerous pitfalls that await. A good brokerage professional can also help identify weaknesses in your business and help you address those issues. Your broker can help you with everything from strategy and negotiations, maintaining confidentiality and establishing the market value of your business, to connecting you with other seasoned professionals, such as accountants and lawyers. Be flexible.  … [Read more...]

6 Basic Tips for Handling Customer Complaints

Customer complaints should always be treated seriously and dealt with in a timely manner.  Serious ones are usually obvious, but even those that appear trivial may be backed by considerable emotion.  Appreciate that you are hearing from the customer because you now have the opportunity to correct the problem.  A dissatisfied customer who doesn't complain is (monopolies excepted) usually a lost customer.  Customer complaints that are not appropriately addressed can fester and become larger problems.  Offering decent customer service should be neither costly nor complicated.  At its core, good customer service can be reduced to listening - letting the customer know that their complaint has been acknowledged and cataloged, and then working to remedy the situation if possible.  A good positive attitude and calm manner when dealing with irritated or dissatisfied customers can go a long way towards keeping a customer happy and halting them from expressing their feelings in an online … [Read more...]

Top Ten Ways to Avoid Wrecking a Deal

Finalizing a deal requires carefully thinking through the deal process well in advance.  It is usually a complex process, with ample room for error, misunderstanding, miscalculation, even without the inevitable wild cards.  In this article, we explore the top ten steps you can take to avoid wrecking a good deal. Confidentiality – At the top of our “how not to wreck a deal list” is confidentiality.  It is vital that everyone involved in the deal takes steps to avoid a breach.  Experienced business brokers are experts at maintaining confidentiality. Flexibility  – The second tip on our list is to be flexible. A lack of flexibility can absolutely destroy a deal. You shouldn’t go into a deal expecting to have all of your terms met. Be Open to Negotiations – Just as it is critical to be flexible, it is also important to embrace the concept of negotiation.  Sellers are used to being their own bosses, but when it comes to successfully selling a business, no factor is quite as … [Read more...]

Make the Right First Impression

First impressions hold true for your company as much as you personally.  It's always best to put your “best foot forward” in your personal life and in business.  It is prudent for every company to step back and evaluate its initial point of communication with customers and clients on a regular basis. In today’s digitally interconnected world, it is critical that customers and clients feel as though they are not just being listened to; they really want to be heard.  Emails must be responded to promptly.  This is true regardless of whether the email is from a customer requesting more information about your goods or services, or if it’s a message with a question or complaint.  If your company is unresponsive, this fact can quickly spread on social media. Of course, customers and clients still pick up their phones and make calls.  While many people’s first impressions of your business are increasingly likely to be via your website, there is no denying the importance of the phone call … [Read more...]

Due Diligence Works Both Ways. Buyer Warning Signs for Sellers.

Many sellers make the mistake of failing to do their due diligence on buyers. While buyers generally know how critical it is to perform due diligence on both the business they are looking to purchase and the seller, buyers often neglect this important step.   Deals fail all the time.  Sadly, this means that all parties lose a tremendous amount of time and effort and sellers often lose money due to business disruptions during the process of working with a prospective buyer.  Let’s dive in and look at a few warning signs that you should look for when dealing with a buyer.  The sooner you spot these red flags, the sooner you can avoid potential problems. There are several key questions that sellers should ask. The list includes: -What, if any, other businesses have you considered to date?  -How much equity will you be committing?  -Do you have any experience with my kind of business?  It is important to look for warning signs early on, as this is the way that sellers … [Read more...]

How an Entrepreneurial Operating System® Can Provide Benefits.

Damon Neth is a Professional EOS Implementer of the Entrepreneurial Operating System®.  Author of X-Formation: Transforming Business Through Interim Executive Leadership, he has founded five companies and acquired four others.   EOS® is a powerful set of business tools that provide a framework that empowers companies to create a clear vision throughout their entire organization, and in the process, boost the health of the company as a whole.  This article discusses EOS® and how it could potentially transform your organization. What is EOS® All About? EOS® is based on the book Traction: Getting a Grip on Your Business, which is written by Gino Wickman.  The effectiveness of EOS® is underscored by the fact that EOS® is currently utilized by over 10,000 companies around the globe.  EOS® is a powerful set of tools that, as Neth explained, “are being used by businesses every single day to grow, transform and capitalize on opportunity and deal with problems.  These tools provide … [Read more...]

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