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You have found a business you want to buy. Now what!

When you have found a business you want to buy, the next step is to make an offer to the seller.  The offer can be in the form of a binding purchase contract, but more often it is a non-binding Letter of Intent or a Terms Sheet. A Letter of Intent or a Terms [...]

Your Management Style Affects the Sale of Your Business

Are you a Macro- or a Micro-manager?  Your style can make a difference in the sale of your business and the price you obtain.. In today’s workplace, who has an eye on the big picture of the business?  An owner who manages every manager and spends the rest of the time shuffling paperwork is [...]

Thinking about financing the sale of your business?

Many small business sales are seller-financed.  There are several important questions you should ask yourself if you are considering financing the sale of your business: What is the lowest amount of cash you are willing to accept? Have you considered what must be paid from the cash received?  Suppliers, vendors, other accounts payable, lenders [...]

Selling your business – a team approach.

A saying often attributed to Abraham Lincoln goes: “A man who acts as his own lawyer has a fool for a client.”  This sentiment also applies to anyone selling a business.  To obtain a successful transaction with the least amount of drama and risk, it is usually best to employ a team of experienced [...]

A serious buyer is financially prepared

In today’s environment of tight money, you must be financially prepared to purchase a business and be able and willing to demonstrate your ability to buy.  No buyer wants to waste time investigating an opportunity that is beyond reach and no seller wants to waste time with a buyer without the financial resources to [...]

Sellers: Make It Easy for Someone to Buy Your Business

Small businesses don’t go on forever.  Owners eventually retire or move on to other interests.  Businesses are passed on to children, sold, or simply shut down.  If you start to position your business for sale today, you will ultimately sell it more quickly and for more money, and make more in the time before you sell. [...]

Cash flow, Terms, and Pricing

A basic principle of pricing a small business revolves around the cash the owner receives from the operation of the business.  Often businesses are priced based on a multiple of cash flow: a “rule of thumb”. In reviewing a business’ historic cash flow, it is important to take into account one-time-events, both good and [...]

Are you serious?

At the beginning of a new year, many business owners ask themselves if this is the year to sell. There are three good questions a business owner should consider before selling his or her business. First, "Do you really want to sell this business?" If an owner is really serious about selling and has a solid reason (or reasons) to sell, it [...]

Why people buy businesses …

The most obvious and most common reason is cash flow; but cash flow alone is seldom the sole reason people buy small businesses.  Usually there are many reasons, but they are almost always in these few areas: Cash flow is the number one consideration.  The amount is important but the quality of the cash flow makes a [...]

Buy or Start a Business?

You want to own a business – the question is whether it’s better to start up from scratch or buy an existing business.  If you have a unique product or service to build a business around, or are following a passion, your choice to start a business may be clear.  For an entrepreneur, making [...]