Selling
A Business
The
decision to sell a business is often a difficult one because
of the profound personal and financial impact. Many different
influences bring business owners to this decision. These include:
- Worrisome
exposure to business risks often aggravated by personal
guarantee of loans.
- Possible
failure of the business if one or more owners become seriously
ill or disabled.
- Divorce
or dissolvement of partnership.
- Owner's
desire to pursue other business interests which may be more
challenging or less stressful.
- Lack
of sufficient working capital.
- A
need within the company for new skills, new resources, or
a new philosophy to cope with ever changing economic forces,
government regulations, and competition.
- Owner's
desire to retire.
These
valid reasons and many others for considering a sale, do not
imply failure or willingness by the owner to accept less than
a fair price for the business.
How
Much Is The Business Worth?
Simply
stated, "a business, like any asset, is worth what a
buyer is willing to pay".
Buyers ask countless questions, but they are primarily concerned
with a fair return on their total investment. In addition,
prospective buyers make judgments about market position,
proprietary know-how, competitive strengths, quality of the
assets, growth potential, and risks of the business. Often
times concerns are greatest where the owner directly interacts
with the individual customers and/or clients. The prospective
buyer worries about the retention of the customers/clients
when the owner leaves. Corporate Investment Business Brokers
(CIBB, Inc.) helps the business
owner determine the true value of the business and, most importantly,
can help prospective buyers understand the reasons for such
value and structure a sale for the maximum benefit of both
buyer and seller.
Is
Confidentiality Important?
Sound
working relations with employees, customers, suppliers, and
bankers are important if not critical factors to a company.
Any premature indication of a possible change in ownership
could disrupt these relations and weaken the company's competitive
position. For these reasons, and many others, confidentiality
is critically important at all stages. With the proper procedures,
it is possible to minimize the risk of an untimely disclosure.
In every transaction, there is an appropriate time to reveal
that a sale may be imminent. Proper timing of these sensitive
announcements can contribute to a smooth transaction and reinforce
the buyer's willingness to proceed to a closing. We help to
ensure that information is kept confidential
throughout the entire selling process until it is appropriate
to reveal that a sale is forthcoming.
When
Is The Best Time To Sell?
Usually
the best time to obtain the highest price occurs when sales
and earnings are good and trending upward. A solid earnings
trend will enable a buyer to pay a higher price and still
meet his return of investment criteria. A history of good
performance also gives the buyer confidence in projected future
earnings.
However, market conditions for business sales also significantly
affect the salability of a business. Today's market is the
best we have seen in the last five years due to a large number
of serious buyers in the market, bank financing is readily
available and rates are the best we have experienced in decades.
The recent reduction in capital gain taxes nets the owner
more.
Who
Would Buy It?
For
most companies, there are several categories of prospective
buyers. The most obvious are the other companies in the same
business for whom the acquisition would be a logical expansion
with potential economies of scale. Consideration should also
be given to suppliers and customers of the business.
However, based on our experience in selling over hundreds of
businesses, approximately 80% of the prospective buyers are
individuals who want to control their own future. Many of
them will be moving into the area from other states and countries.
We are in continuous contact with all categories of buyers and
we utilize effective search procedures to find and screen those
who are best qualified to buy. Click here for just a sample
of Businesses Wanted.
How
Can We Help?
We
can help by using our experience and know-how gained from over
hundreds of business sales to guide you through all of the
complex steps required to sell a business. The first step
will be our review of the company's history and your objectives
to make certain that a sale is the best course of action.
This review includes an opinion of selling prices of the business
in today's market.
If you decide to proceed with the sale of your business, we
prepare custom-tailored presentation documents, develop buyer
prospect lists from our contact files and other resources,
make the proper approaches and screen the buyer prospects,
and introduce only serious, qualified buyers to you. We will handle the entire transaction from the initial introduction
of the buyer through closing, including coordination with
attorneys, accountants, landlords, leasing and utility companies,
and other agencies.
You may ask: "Why can't I sell it myself?"
There are several reasons why most owners choose not to:
- An
owner representing himself cannot maintain anonymity and
the lost confidentiality could seriously hurt the business.
-
An
owner may not be knowledgeable in current areas of law,
accounting, taxes, and marketing of businesses.
- An
owner typically does not have the ability or time to contact,
screen and qualify a large group of prospects to find a
qualified buyer who is serious and will offer a fair price.
- An
owner's talents are much more effectively utilized in running
the business than in trying to sell the company.
- An
owner generally would not have the experience, knowledge,
and negotiating skills needed to sell his company efficiently
and for the best price, particularly in a highly emotional
negotiation such as the sale of a business where the buyer's
objectives are totally opposite of the owner's.
We
can and will make the sale of your business a reasonably pleasant
experience. Call us to find out
how we can help you.
Why
Use Us?
All
of our previous clients and customers selected us to assist
them in the sale or purchase for the same reasons: EXPERTISE
AND PROVEN RESULTS.
Find
out more about us.
