|When is the best time to sell?
Buy low sell high ! So simple yet so difficult to do.
Think of your business as the biggest item / customer in your inventory,
what would you do to get the best price?
Hire the professional who knows how to get this done.
Call us to day to get things started.
Mistakes to Avoid When selling your business
Years ago, when I first learn to fly, a crafty old veteran
offered me some prudent advice. He said "there are
three things that will never help you when you fly -the
runway behind you, the altitude above you, and the
gas you don't have."
While selling a business may not involve the same
risks as piloting a plane, mistakes can often be just as
fatal to the desired result. So, just as the wise old
flying veteran offered, here are five pitfalls that will trip
you up every time.
- A Buyer with No Money
- A Lawyer or CPA with No Experience in deal making
- Too Many Decision Makers
- The Earnings You Don't Have
- The Tax Return You Didn't File
It is certainly no surprise; you see it every day as you
run your business: the more thoroughly you plan, the
better you execute and the more mistakes you avoid,
the more successful you will be. It's really no
difference when you sell your business.
How far ahead should seller plan for ownership
Have you heard of Five year plans? This is one of
those plans. The bigger the project, the more
planning is needed. It is standard business practice to
ask for THREE years financial statements for
The following are some
Most common statements Sellers make.
If you have a buyer, bring him to me!
For list of pre-screened local, national and
international buyers, please visit this link.
Buyers will point out what direction their money wants
to go to, Business brokers know how to pin down
buyers, how to present your business and protect
your confidentiality and is familiar with selling process.
NO buyer is willing to waste time and money to look at
a business, until they have seen information on that
business. We will be happy to explain what we will
need to present your business to ready, capable and
Real buyers are not on a shopping tour and business
brokers are not a tour guide.
I never pay anything upfront; you need to invest
your money in selling my business.
Excellent employees don't pay to get a job. Business
owners don't spent time and money on clients that is
not sincere in doing businesses. If a seller would not
or could not spent time and money to do it right from
the start, there is very little chance that a business
broker could collect a success fee in selling this
When seller and buyer receive an accurate,
irrefutable and defensible descriptive report that
include all necessary descriptive information that will
withstand scrutiny, only when buyer and seller get
what they were promised, only than; there will be no
problem after the sale.
Attorneys, accountants and community leaders
will help me sale my business.
In order to serve your needs as a seller, these people
need to be deal makers, but too many times, they act
as deal breakers. Attorney's first instinct is to prevent
legal action against them. CPA's first instinct is to
prevent audits. Community leaders did not make their
living on selling businesses, community leaders make
nice, so every one likes them. They need to be as
interested as you are in closing the deal as they are
in protecting you. Too often, attorneys and CPAs are
more interested in legal or financial purity than they
are in assisting you by closing your sale. So many
times your advisors want to help you renegotiate the
deal. The result is that they provide protection for
problems that have virtually no likelihood of occurring.
This wastes time and money and, more importantly,
tests everyone's patience. Experienced attorneys,
accounts and advisors with a history of successfully
completed business transfers understand how to
protect you while getting the deal done. Your
attorney, CPA and advisors must know how to get the
Business brokers are not real estate agents.
Business brokers are merger & acquisition specialties,
like Morgan Stanley, Goldman Sachs, Merrill Lynch
and such brokerage houses for middle market
businesses; we specialize in businesses with annual
sales between $3 million to $50 million. The dollar
amount might be less; the amount of work to get the
deal done is still the same.
Donald Trump hired Merrill Lynch to "explore" the
possibility to sale his casino business. 3/12/07
What a wise man does in the beginning, a fool does in
Why should sellers have to give brokers
exclusive right of representation?
In order to obtain the best price for your business and
still maintain strict confidentiality, the strategy is to
create a wining team. How may accountants,
attorneys, managers and financial advisors do you
need to hire for one job? Business broker would be
your team leader, your head coach and coordinator.
Without an employment contract and a clear mission,
how likely will your team be able to achieve your
goals? One team one objective.
We are in the business of helping our clients to meet
their financial challenges. We do this by using a total
wealth management approach, each area is important
individually, by managing them all collectively is one of
the most profitable considerations in our clients
overall financial success.
Buyer should pay for broker’s commission.
Buyer do pay, we collect from the seller.
When you pay sales tax, government does not collect
from you, government collect from the seller. This is
the system set up by the United States government.
Could you guarantee the sale of my business?
How could some one guarantee that you will or will not
accept an offer? If we have a firm understanding of all
the details up front, we will have a better chance than
not to sale your business. We provide our clients the
marketing and financial expertise you expect while
maintaining the highest level of professionalism,
integrity and confidentiality.
We provide professional services including marketing,
business & equipment valuation, confidential offering
memorandums, qualifying buyers, deal structuring
and negotiation. We only work with sincere, motivated
seller and buyers. We could only collect a success
fee, when the deal successfully closes.
We only work with people who are sincere, capable
and ready to move forward in completing the deal.
How to exit your business feet first
By Joe McCaul, Naperville, Illinois
Here are ten simple rules to follow if you’d like to
work until you drop. It is important that you follow
them carefully or you might inadvertently become
rich and idle in retirement.
Rule #1. Avoid Planning of Any Kind
Everyone knows how unpleasant it is to meet with
financial, estate and succession planners. They
ask too many questions and make you think
about your own mortality. Don’t go there!
Business plans – who needs them anyway? Don’t
you know what needs to happen next? No one
else needs to know. Keep all employees guessing
about your eventual exit strategy.
Rule #2. No Business Valuations by
Your cousin sold his business a few years ago.
Rely on his expertise and save yourself the
expense. The guy who does your taxes might
know something. Ask him. Your attorney talks to a
lot of people too. Between all these sources, you’
ll find someone who will agree with your inflated
Rule #3. Now that your business in
successful, take it easy
Your business has reached a manageable size
now. If you decide to grow it further, you would
have to work harder. A stable business that is
easy for the owner to run must surely be worth
more than a rapidly growing one that puts
demands on your time. Relax.
Rule #4. No one you know could buy you out
or run your business.
If you followed Rule #1, you don’t have to worry
about your employees or children taking over the
business from you. They don’t have any money
and aren’t trained to replace you in any case.
Rule #5. Do not hire a business broker.
Any reputable broker would immediately want to
break all the preceding rules. You can do this
yourself. Your neighbor has said for years that he’
d like to buy your company. Brokers will tell you
that one buyer is no buyer. They will explain to
you how they can help get you the best deal while
maintaining confidentiality. Do not believe them.
Rule #6. Wait until a serious buyer appears
before assembling your team of advisors
Attorneys and accountants are generic
commodities readily available on demand. Bring
them up to speed when you need them. They do
not need transaction or deal making experience.
Don’t let them meet or communicate directly until
closing. They’re probably just running up their
billable hours. Remember Rule #5 - no brokers!
Rule #7. Time is not of the essence
Real buyers always pretend they are in a big
hurry. This is an act. They have some story like “I’
m unemployed and living off my savings.” A
corporate buyer or private equity group might say
they are considering a different opportunity. Their
lawyers will put in “time is of the essence” to
reinforce that deadlines are meaningful. Ignore all
such arbitrary demands. Be sure to surround
yourself with like-minded advisors.
Rule #8. Some skeletons are best left in the
Disclosing negative information about your
business will only lower its value. If it surface
before closing, you’ll be able to dance around it.
Rule #9. Push all risk onto the buyer
Demand all payment in cash at closing. No
escrows, no earn-outs, no seller notes. Resist
any requests for representations and warranties.
Demand to sell stock instead of assets but reject
any thought of indemnifying the buyer for issues
that arose on your watch.
Rule#10. The deal can always be sweeter
You let your guard down and signed a Letter of
Intent. All is not lost! There will be four to six
weeks for you to renegotiate the deal on a daily
basis. The hook is already set in the buyer’s
mouth. Be creative now. Demand payment for
unreported revenue. Come up with new add-
backs to improve your apparent cash flow. Alright
– just say you want more money than any of the
figures will support. After all, yours is a very
Congratulations, by carefully following these
simple rules no one will ever buy your business.
Your role is secure as long as you remain
physically able to perform unless of course your
business goes belly up in the interim.
I need referrals from your customers.
Federal law and regulations state it, and you may
already know, any information you provide
professional advisors in the act of seeking advice
or planning is protected by attorney - client
privilege. Additionally, any information that is
provided to the professional in preparation or
anticipation of a case which may possibly appear
before the United States Courts is also protected
by attorney-client privilege.
Attorney-client privilege means that the
information come into advisor's possession of
cannot be disclosed by advisor, nor can
disclosure be compelled from us. In other words,
government agency cannot drag me or one of our
staff into court under a subpoena and compel us
to give testimony about items which are protected
by this privilege. The privilege belongs to you,
not to us. The only time the government can force
us to disclose privileged information is if you or we
have in some way violated that privilege by
disclosing the information or discussing the
information with others outside our relationship.
Our office has taken extensive internal
precautions to ensure that your information is
kept privileged and secret, which means the
burden is on you, if you wish to keep it safe from
compelled disclosure, to ensure that you also
keep any privileged information secret.
Of course, not all the information we receive is
subject to attorney-client privilege, nor is all the
information we receive are deep dark secret.
From time to time, you may actually want to have
us disclose some of the information we receive
from you. We work with ready and able buyers,
financial services and other professionals jointly
to provide you comprehensive services that you
require. We will only disclose information about
you or your company to these individuals if we
receive permission from you to do so.
The confidentiality of you and your business is of
the highest priority to us, we have gone to great
lengths and this extends to each person in the
firm, to protect that information. If you have any
questions or concerns about this matter, please
feel free to contact us at any time.