The KEY to SUCCESS is found in attending to the details while maintaining your focus on the big picture! That's why it's so important to have a Business Plan - even a simply business plan, and then building a great team of business professionals to help guide you on your entrepreneurial journey!
Having a business plan and reviewing it on a regular basis gives you an opportunity to make sure you're heading in the right direction and have access to the necessary resources.
With so many things 'screaming' for your attention, it can be very easy to overlook important aspects of your planning, simply because something else (something of lesser importance) grabbed your attention. At Pro-Vision Solutions Inc. we work with you and other members of your "team" of professionals to help you build your business and maximize it's potential!
Planning is important regardless of the stage you're at with your business. Planning was important at the start, it's important as you grow, and it's even more important as you plan to exit from the business and move into the next phase of your entrepreneurial career. That may be another business venture, or it could be those long dreamt of retirement plans!
In this post, we've invited our friends from Sunbelt Business Brokers to share a few more of their thoughts and expertise with some helpful tips for those looking at selling, or purchasing a business.
Thank you in advance for your comments and helpful suggestions that you can add for others for those in our circle of contacts. We also appreciate your passing this post on to those you feel could benefit from this information. And now, please enjoy our guest blog post.
20 Ways Business Owners Mess Up
When Selling Their Businessby Dale Alton
Part 2 of a 3 part series
Though it may seem daunting at times, there are many things that can stand in the way of the successful sale of your business. Preparation is the key! A Sunbelt Business Broker can assist you in what can often be an unfamiliar process for a business owner.
As with all things, where a generalization is used, there can be exceptions - and number 11 on our list is a good example. As stated in our first installment, a team of professionals (i.e. business broker, accountant, tax lawyer, wealth planner, and a business coach) can help you build a road map for increasing the value of your business, transitioning successfully into the next phase of your life. You will want a good team to take advantage of tax strategies to maximize the proceeds of your business sale.
What Not to Do When Selling Your Business
11. Discount the advice of your business broker, assuming your lawyer or accountant know best
Choose the right professionals— experts who have actual experience in buying and selling businesses and who understand their role in the process can be a great asset. Most lawyers and accountants are not entrepreneurs or business experts. Because their job is to protect your interests against all conceivable risks, the safest recommendation they can make in every situation is to not take a risk. Business brokers are trained to sell businesses! Rely on their expertise to negotiate well, and create win-win terms that work for both parties.
12. Disrespect cultural differences
Emotions can run high during negotiations. Give and take, and the need to listen to, understand and respect the other party’s position, is needed on both sides. Be sensitive to cultural differences—acceptable protocol varies by culture, so the potential for misunderstandings and strained relations increases. Let your broker do the negotiating. He or she understands the cultural differences. And you need to maintain good relations, as you’ll have to work together after the deal is done to provide for smooth training and transition.
13. Battle over trivia
Delays kill deals. Don’t sweat the small stuff and don’t get into a contest of wills, where one side (i.e. you) “wins’ and the other “loses.” If the deal does not work for both sides it will not work at all. Know the deal breakers that must be addressed for the sale to go through. Aim for a win-win conclusion by offsetting each of your necessary demands with a compensating buyer advantage, and by working together to address the issues necessary to meet both of your objectives. Again, rely on the professional expertise of your broker to negotiate well, and create terms that work for both parties.
14. Balk at seller financing, nervous about risk
Most buyers will need the seller to finance part of the purchase price. Seller financing can add as much as 30% to the price of your business and you get interest on top of that. Sellers can be nervous about the ability of the buyer to run the business successfully. A training program to equip the new owner to operate the business successfully and ensure a smooth transition can make the difference. You are safest lending 50% of the purchase price to the buyer and being in first position on everything, rather than lending 30% and being in second position behind a bank. Other issues affecting the business and loan i.e. illness or death of the buyer can be mitigated with insurance.
15. Leave telling the landlord to the last
Never assume that the landlord will approve the transfer or assignment of a lease to the buyer. Sunbelt Business Brokers will speak to the landlord as early as possible, but only with a signed Non-Disclosure Agreement in hand. Deals can fall apart because of landlords’ refusal or slow processing of lease assignments.
One of the keys here is to try and ensure that there is a provision for a clear method of the assignment of the lease, should you decide or need to sell, when you initially structure your lease contract.
I believe that a great resource in this area is the “Lease Coach”. They provide a great service and have good success in helping owners understand and negotiate leases prior to making these substantial commitments.
Sunbelt Business Brokers Edmonton
Sunbelt’s team of brokers, operating at local and regional levels, have experience selling small to medium sized businesses.
A variety of strategies are required to sell businesses from different industries, of different sizes, and in different economic climates. Many Sunbelt brokers have specific industry experience and cooperate with their counterparts to identify the buyer and create the right framework for the sale.
Your Local Sunbelt Business brokers sell a diverse mix of main street businesses valued under $3 Million. Mergers and Acquisitions of larger and more complex business transactions of up to $30 Million are managed out of the Ottawa Head Office. We would like to help you plan and look forward to retirement, expansion or an exciting new business opportunity.
Have you ever thought about selling your Business?Sunbelt represents clients who may be interested in buying a business like yours. If you are thinking of selling a business now or in the next 3 years, discover what your next steps should be. Feel free to contact our Sunbelt Business Brokers Edmonton office if you have any questions or would like a free confidential consultation. Give me a call. Dale Alton – 780-878-8787
Sunbelt - The Place to Buy or Sell a Business.
In closing, we invite you to consider Pro-Vision Solutions Inc. to be a part of your TEAM of business professionals. We'd be pleased to assist you as you work on your business plan, whether that's at the start-up, growth or expansion phase. Please let us know if that's something you may require, and let's have a conversation!
Together, we can help you Build your Business Dream, starting with your Business PLAN.
NOTE: For more information on the services provided by Pro-Vision Solutions Inc. and how we can assist ... please visit our Website: www.pvs4u.ca