21 Jan Around the Web: A Week in Summary
The following information has been sourced by Business Brokerage Press for the benefit of the business brokerage community. The views of these articles do not necessarily represent the views of Business Brokerage Press. We hope you find this information helpful.
A recent article from Viking Mergers & Acquisitions entitled “Selling a Business: Tips to Know and Pitfalls to Avoid” offers insights for business owners who are preparing to sell their business. The article explores three common pitfalls sellers face and how these pitfalls can be avoided.
- Not knowing what the business is worth – 65% of business owners are guilty of this, making it difficult to properly price the business. A professional business valuation can solve this.
- Missing documentation – Without proper financials, it is very difficult to sell a business. Business owners should have 3 years of tax returns, 3 years of profit and loss statements, a copy of the lease, inventory lists, etc.
- Focusing on only one buyer – While this may be easier, it can limit the sale price and even lead to no deal. Engaging with multiple buyers can increase the sale price and help improve the odds of a successful closing.
A recent article from Exit Oasis entitled “Why Do I Need to Care About the Buyer?” highlights a podcast called “Let’s Buy a Business” which takes you through the journey of buying a business and helps gives the buyer’s perspective.
Host Ryan Condie discusses how he has started, purchased, grown and sold businesses. He explores what he would have done differently to make the businesses better prepared for the sale such as having better accounting and documenting operational procedures.
He also discusses what a buyer should be looking for such as if the accounting is well-organized, if everything is in the owner’s head or if it is fleshed out in operating manuals, if the marketing is going strong while the business is for sale, and what the state of the inventory is.
A recent article from Viking Mergers & Acquisitions entitled “How to Buy a Business: 5 Tips for First Time Business Buyers” discusses helpful advice for those considering the purchase of a business. This process is exciting yet complex, so going in with knowledge is very advantageous.
The article offers the following tips:
- Buy the right business for you – relative to your values, interests, expertise
- Know the value of the business – analyzing the financials to determine an appropriate price
- Conduct thorough due diligence – investigating and verifying all business information
- Remain sensitive to company culture – maintaining stability with employees and customers
- Consult a professional business broker or advisor – utilizing experienced professionals to navigate the entire buying process