Insights from BizBuySell’s 3rd Quarter Insight Report

Most business buyers and sellers are wondering what 2021 and beyond will bring.  BizBuySell and BizQuest President Bob House provided a range of insights stemming from BizBuySell’s 3rd Quarter Insight Report and a survey of over 2,300 business owners.  The simple fact is that the pandemic has most definitely had a major impact on the buying and selling of businesses.  This fact is obvious.  But diving deeper, there are a range of insights that can be gleaned.  First, owners do understand that COVID is a massive force in business right now.  According to the survey, 68% of owners feel that they would have received a better price for their business in 2019 than in 2020.  Only 37% of respondents felt that they would receive a better price this year.  Of owners who felt that they would receive a lower price in 2020 than in 2019, 71% of these owners said that their assessment was directly tied to the pandemic and its accompanying economic impact. A question on the survey asked owners if the … [Read more...]

Zeroing in on Goodwill

Goodwill is a term that might cause a little confusion for some.  But at its heart, it is a relatively straight-forward concept.  Goodwill is generally viewed as a term that encapsulates everything from a business’s reputation to the goods, services and products it provides.  The key idea is that there is goodwill if the business is viewed as a true and functioning business that has longevity in the marketplace.  The Importance of Reputation It is important to point out that many of the aspects that go into defining goodwill are not easily noted on a balance sheet.  One of those elements has already been mentioned in the form of reputation.  A good reputation is an intangible asset that is hard to put an exact dollar amount on.  Imagine that you had a choice between two businesses that were almost identical.  However, one business enjoyed a strong reputation while the other had a reputation for poor customer service and goods and services.  This decision would be an easy one for most … [Read more...]

What Makes a Deal Close?

For every reason that a pending sale of a business collapses, there is a positive reason why the sale closed successfully.  What does it take for the sale of a business to close successfully?  Certainly there are reasons that a sale might not close that are beyond anyone’s control.  A fire, for example, the death of a principal, or a natural disaster such as a hurricane or tornado.  There might be an environmental problem that the seller was unaware of when he or she decided to sell.  Aside from these unplanned catastrophic events, deals abort because of the people involved.  Here are a few examples of how a sale closes successfully. The Buyer and Seller Are in Agreement From the Beginning In too many cases, the buyer and seller really weren’t in agreement, or didn’t understand the terms of the sale.  If an offer to purchase is too vague, or has too many loose ends, the sale can unravel somewhere along the line.  However, if prior to the offer to purchase the loose ends are taken care … [Read more...]

Keys to Improving the Value of Your Company

The first key is to have your accountant take a look at your accounting procedures and make recommendations on how to improve them. He or she may also help in preparing financial projections for the coming year(s). Getting your company's financial house in order is very important in establishing the value of your business. The second key is to review the reputation, image, and marketing materials of your company. Certainly, the quality of your product or service is paramount, but how your business presents itself to customers, clients, suppliers are very important. The appearance of your facilities and customer services – beginning with how people are treated on the telephone or in the waiting/reception area – are the kind of first impressions that are critical in dealing with your customers or clients. A third key is to get rid of outdated inventory – sell off any extra assets such as unused or outmoded equipment, vehicles etc. Contracts, agreements, leases, franchise … [Read more...]

Sell Your Business and Start Your Retirement

When the day comes to sell your business, it is important that prospective buyers understand why you have made this decision. Having a valid reason why it is time for you to sell can make your business more attractive to prospective buyers. In fact, it is safe to state that buying a successful business from an owner that is retiring is just the kind of the situation that most buyers like. It is important that your departure does not disrupt the operation of your business and that prospective buyers understand that you have taken steps to ensure a smooth transition. A key aspect of streamlining, simplifying and organizing your business is to pick out, well in advance, your second in command. Once you have decided on which person would be the best candidate, it is important that you begin grooming that person so they can take over day-to-day operations. Having a capable person who is committed to staying is a very attractive commodity for prospective buyers. Copyright: Business … [Read more...]

Five Reasons Business Brokers Improve Closing Rates

It has long been a well-known fact that business brokers can help improve closing rates. In this article, we will take a closer look at the five top reasons why having a business broker on your side can make all the difference in the world and keep it Confidential. #1 – They Reach the Most Buyers What seller isn't looking to reach more buyers? When more candidates are reviewing your business, the odds of selling for your desired price only go up. The simple fact is that business brokers reach the most buyers. #2 – Business Brokers Know How to Navigate Negotiation Hurdles As the old saying states, “there is no replacement for experience,” and this definitely holds true for business brokers. Business brokers know what it takes to circumvent negotiation hurdles. Their years of hands on experience means they can spot problems long before they occur, and this dramatically helps them sell your business. #3 – They Know How to Present Your Business Once again, experience … [Read more...]