16 Jan Around the Web: A Week in Summary
A recent blog post from Sunbelt entitled “Top 10 Businesses to Buy in 2019” explores industries expected to grow in 2019 and provides a brief description of each so that you can determine the best fit for you. The industries are:
- Senior Care
- Social Media Specialists
- Smartphone Repairs
- Pet Industry
- Coffee Shops
- Delivery Services
- Healthy Fast Food
- Automotive Industry
From the introduction of baby boomers to the retirement community to the increased health-consciousness of consumers, the year ahead is a promising one. Choosing an industry to invest in this year can be an overwhelming decision, working with a business broker can help to ease the decision and pair you up with the right opportunity for you.
A recent article from NuWire Investor entitled “How to Find the Right Broker to Sell your Business” explains the most important characteristics a seller should be looking for in a business broker when deciding who to hire.
When it comes to hiring a business broker to sell your business, you want to ask the following questions to ensure that you’re choosing a broker who will improve your experience and increase the chances of selling your business:
- What do they know about major players, important trends, insider terminology or future industry projections? It’s important that a business broker is well acquainted with and well connected in your specific industry.
- What have they sold before, and what is their success ratio? Beware of a business broker who isn’t transparent with you on these things.
- How do they charge for their services and when are they expecting to be paid? A good business broker will set these expectations up front, very clearly in the agreement between the seller and broker. Typical commissions are between 8 and 12%, paid after the business is sold.
- How is the business broker planning to market your business? As a buyer, you want to make sure that the broker you choose to work with has plans to engage their network and actively seek out connections who would be interested in your business.
When it comes to choosing a business broker to work with, who you choose to handle the sale of your business matters tremendously. It is better to take your time and find someone who makes you feel comfortable and has the proper knowledge and connections than it is to miss out on a favorable deal.
A recent article from Divestopedia entitled “Human Capital Risk and the Impact on Business Value” discusses how a business’s quality of employees can impact the overall value of the business in a sale.
A new potential buyer wants to know that the business they are purchasing will do well after the transaction. If a company has a stable, skilled, quality workforce and is not reliant on the owner to function at a high level, then this is a good sign that the business will in fact do well after the sale.
Human capital refers to the stock of competences, knowledge and personality attributes embodied in the workforce that has the ability to produce economic value. It is important to assess how available labor is to perform key tasks within the business, how well the staff is a creating capital versus how much capital they are costing the business and how possible it is that key employees will be leaving after the sale of the business. Evaluating these key factors in the workforce and working to eliminate or resolve any risk factors can significantly increase the purchase price of a business.