Tag Archives: exit strategy

Selling Your Business and Dying

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When are you thinking about selling your business?  10 years before you die or 1 year after you die.

I don’t like thinking about death, I dont like talking about it, I dont like writing about it.   My Mom just passed away a few short weeks ago. I am a business broker based in Florida   helping people  buy and sell businesses.  I started and ran and owned a business of 20 years and successfully sold it.  I know my Mom was proud of me.  I know it.  Is that an even exchange?.  Mom you give all of yourself for me your whole life and in exchange, I will try to make your proud of me

I have so many discussions with people about significant life decision.  Business owners want to sell “so they can enjoy life”.  Prospective business buyers want to buy a business because the opportunity to do so wont be there forever.  Life is short.  I Currently have a client that the  owners (husband and  wife)  wanted me to help sell their business.  It took a long time.  We have it under contract,  But several months ago, the wife got sick, and then sicker and then a few months ago, she passed away, at a relatively young age.  They wanted to sell their business so they were not so tied to their business and they could enjoy “those other things in life” together.  As she got sick, they anticipated having x years to enjoy life together, without the business.  Those years became months and then became days and now the surviving husband is trying to piece together plans of how he can enjoy his days without the woman he had made those prior plans with.

“I am going to wait to sell my business next year”.  Sometimes there is no next year.

I sold my successful business of 20 years at a relatively young age because I wanted to do something else.  I had some health issues that afforded me a different perspective on life.  I am now a business broker and I truely  enjoy and embrace the magnitude of what I am part of.  Buying and selling a business is a life changing event. Yet being a business broker is also a very challenging and difficult business.

So many business article exist on the internet  about how to “Buy the Best Business” or “How to Sell your Florida Business”, or “5 Best ways to find the best Business Broker” .   I’ve even written some myself.  This is not one of them.  How much do you let life get in the way of your business?  How much do you let business get in the way of your life?

 I got back from doing my Moms eulogy to meet with a 71 year old business owner that wants to sell his business “so he can enjoy life fully with his wife”.  Isn’t that a good reason to sell your business?.  I not only think so- I know so.

8 Biggest Reasons I want to Sell My Business or Buy a Business

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8 Biggest Reasons I really want to Own My Own Business Can  look very much like the 8 Biggest Reasons I really want to Sell My Business.

Reasons to buy sell a business

Why does someone buy a business, and what does drive a business owner to the decision to sell their either long term ownership of a business or short term ownership of a business?  As  Former and current  business Owner I have owned a couple  businesses,  I have started businesses, I have bought multiple businesses, and I did sell my business.  As a  Florida Business broker I have both represented Buyers and Sellers of businesses.

So much goes into the decision  of buying a business or into the thought process of selling a business, but often it can be similar criteria that just sits on the opposite side of the ledger….

Owning your own business can be one of the most satisfying processes in ones life.   Why does someone want to own a business.  Very often it becomes the same reasons one wants to sell his or her own  business.

Reasons For Owning Your Own Business: “I want to Buy a Business because” –

1)MONEY– want to make lots

2)PASSION– I love making widgets- I love helping people with my products/ services
3)ACCOMPLISHMENT– It just feels good and a feeling of success
4)OBLIGATION– It is my best means to support myself and or family.
5)EXCITEMENT– I love working 24/7
6)CONTROL– I control my own destiny. I am the boss, I wont have to report to anybody. I can do whatever I want!
7)OPPORTUNITY– I’m young-limitless full of health, energy, optimism
8) TIMING – “I’m Ready” to buy own my own business

Reasons For Selling A Business: “I want to sell my Business because “-

 

1)MONEY-Not making enough, money is less important.  Or Ive done well and ready to cash in on my efforts.
2)PASSION– I used to love making widgets, now I’d rather collect shells, golf, work for someone else or do anything but make another widget. of ” If I have to deal with another customer I’ ll scream”.
3)ACCOMPLISHMENT– The feeling of accomplishment is gone and or less significant, or Ive accomplished all Ive wanted in this business.
4)OBLIGATION– My family is no longer around, Im not going to pass business on to my kids
5)EXCITEMENT– after working 24/7 I am now burned out and I get excited about the idea of not having to deal with it anymore
6)CONTROL-Insurance Companies,employees,IRS,State, Federal policy control my destiny, and run my business more than I do!
7)OPPORTUNITY– I feel old,  have health issues, tired- lack the energy this company needs- exceeded my limit
8) TIMING– “I’m Ready” to sell my business and move on…

While the list could go on and on, Contrary to common belief—– Its not always just about the money

When do I think it is a  good time to buy a business?  When YOU are “ready”

When  is a good time to sell my business –  When YOU are “ready”

 

 

 

Website & SEO Before You Sell Your Business

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Selling your business requires you to prepare your business for sale. One of the important steps in preparing your business for sale is a well designed web site that produces results. Below is information from the perspective of an SEO Web Design firm.

Tampa SEO is a full service web design and SEO agency in Tampa, FL. Here’s an article they wrote regarding web design and SEO prior to selling your business.

Why You Need SEO & a New Website Before Selling Your Business

So you have decided to sell your business and are making moves to get top dollar for your baby. Being a good business owner you understand that although your business means the world to you in the business world it is about proving the dollar amount from both an appraisal and sales perspective.

Whatever your business may be, the prospective buyers want to see the purchase and new ownership process go as seamlessly as possible. This means all your records are in order, the permits or licenses are all up to date, and most importantly the business will continue to be as or more successful than it was with new owners. Tampa SEO highly recommends that a new website and SEO campaign can help you with the latter.

Your business website represents your professionalism

When it comes to business success most owners will agree that the online market is one of the most important. Your website is the representation of your products and services, your image, your authority in your industry, and a way to provide potential customers information in a day and age where the Internet is the first place people look. Basically, having a well-designed website will help build business, retain business and represents everything you have worked so hard for when you yourself can’t make a live impression.

Tampa SEO knows that a modern website helps businesses before, during, and at the end of their operation so that they can showcase their professionalism and utilize their website as an additional marketing tool. Although having a great website will help with conversions your business will still need a way to attract customers and PROVE that it is a great marketing tool before its sale. This is where search engine optimization (SEO) comes into play.

SEO

Photo (c) topseopicks.com

SEO is simple, easy, and fast way to get increased market share prior to selling

While a website can be the source and reason you convert leads, SEO is the reason these leads are finding you. A new website and SEO campaign helps customers or clients who are already looking for your products or services find you quickly and easily. When a customer goes on to Google and searches for a generic phrase related to your business SEO makes your website come up high in the rankings and improves the chances that that customer will make a purchase from you.

This relates to the sale of your business because with SEO all the website activity is quantifiable. When you can prove to potential buyers that you have X amount of traffic and X amount of conversions you have proved your market share and ability to sustain business in the future. This is a great selling point as most other marketing campaigns- TV, radio, Yellowpages, etc. are difficult if not impossible to measure.

Shows new buyer you have continued to improve the business while selling

Every business buyer wants to know that the risk they are taking by purchasing your business is justified. What better way than showcasing to them through your new website and SEO analytics that your business is sustainable and can continue to grow through attracting new customers online. You have showcased the effort to improve marketing before you sell your business and have begun the process of attracting a bigger clientele through SEO.

It seems that websites and Internet marketing are a piece of every business plan these days. When selling your business make the decision easy for the buyer. Showcase to them that you care about the success of the business even after ownership has been transferred by investing in a website and SEO campaign that will continue to be successful even after you are gone. It is a huge buying factor and can improve the bottom line you can charge for your business as it is all justifiable.

Scott M Messinger is a business broker based in Florida.  I work with both business owners and individuals in the process of buying and selling businesses.  I normally write my views and perspectives from a small business owners standpoint.  The above article is helpful information provided from the perspective of an SEO Web Design Company.

 

 


 

Waiting…. to Sell Your Business

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I just had a birthday.  Yeah I know- So What….  But  celebrating a birthday when you are “Middle Age” by most definitions and or “old” by my teenage daughters definition a little introspection is done.  Fact is Im not getting any younger.  As a business broker based in Florida it also makes me think of all the business owners that are getting older and maybe are or have been ready to sell their business but the bad economy has delayed that decision. Another year passes, the “recession” is still with us and it really looks like it will be with us next year and maybe beyond.

How Long Can A Business Owner Wait To Sell Their Business?

What if this down economy last 2,5, 10 years.  I am generally an optimistic person.  I started and owned a business for 20 years and during the lean years I continued to see the glass as half full, and fought thru some difficult years and successfully sold my business when I was ready.

I believe there are many business owners that had planned to have exited their business by now.  Maybe they planned to sell their business and begin enjoying “that retirement thing” they have heard of, but had to delay those plans due the the reduced value of their 401k and other investments, the reduced equity in their home, and the lower revenue and profit of potentially their biggest asset- their business.  Its easy and common to say ” I want to sell my business but I don`t want to sell it now when my business is down”.   I understand that thought process.

Things To Consider When Deciding To Sell Your Business

But I think from here is where the thought process becomes more difficult.  Considerations should include:

  • What if we remain in a prolonged recession- can I wait 3-5 plus years?
  • What happens in our world of supply and demand. Is a pent-up supply when released, going to affect prices/values downward as the increased supply hits the market?
  • Is there really this large number of baby boomers looking to exit businesses and move into retirement to further flood market and affect supply/demand price?”
  • Maybe I’m told I should wait… Ive been working for 20-30 years towards this “end game”, do I really want to wait?

As a business broker in Florida, maybe some day I will go to a meeting of business owners and not hear stories about a foreclosure that one is going thru or their friend is going thru.  Maybe I will attend a seminar or educational session put on by bankers or SBA bankers that doesnt sound empty and completely disconnected by thier purported audience- the small business owner , that needs financing or entrepreneur that wants to buy a business.  This may happen, but its not going to happen tomorrow.  But how many tommorows is it going to take.  How many more birthdays will pass before the time is right to sell your business.

How to Double Your Customer Base Overnight-Buy a Competitor

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As a business owner for 20 years I was involved in an industry that was expanding and rapidly growing. The  size of the “pie” my competitors and I were  competing over was getting larger as the industry grew and we all sought to get our share of this bigger “pie”. So we increased our customer base as the market grew, and we also grew our customer base by buying competitors which resulted in many successful synergistic acquisitions.

In today`s economy in so many industries people are needing to spend less, cut back and therefore the “pie” is staying the same size or the “pie” is getting smaller. So you have business owner competing for their piece of a smaller pie .  As you have the same amount of competitors competing for a smaller pie either all get less, some get more by pricing or efficiencies, but those getting more, results in other competitors getting less and or so much less that they no longer exist.

 

Today as a business broker in both South Carolina and  Florida.  I am working with several business owners looking to keep afloat and looking for exit strategies that meets their needs.   Selling their business and going to work for the acquirer  is an interest I have heard on several occasions as an exit strategy that they would welcome. (Also work with several business owners that have solid business models that are doing well).

Buying A Competitor

A fast and often cost effective way to gain a bigger piece of the pie is by buying a competitor. Growing your customer significantly “overnight” by  buying a bigger “piece of the pie”.  Buying a business in a growing industry and or economy is a solid and effective way to grow a business.  I had utilized this approach on multiple acquisitions to add to our own organic growth.  Buying a business, or buying a competitors business in a recession can also be an effective means to grow your customer base and grow it fast.

Often most business owners dont consider acquisition as a possible way to grow a business because they feel they do not have the funds or resources to make such acquisitions.  But:

1)possibly you can find a struggling competitor that may welcome the opportunity to escape the burden of trying to run a struggling business

2) possibly you can buy a business of a competitor that offers Seller financing.

3) possibly part of the purchase price can be the assumption of debt on trucks and or equipment that may be assumable and may be affordable thru the synergistic cash flow of the business

4) possibly offering the owner of the business you may buy long term employment.  A small struggling business that may have a few employees-  who may be the last person to get paid?- the owner.  An owner may welcome the premise of steady and consistent compensation.

5) Possibly you can secure outside financing- An approach I always used as my last choice but may fit your situation

Furthermore, would you be “just buying a failing business”? No.   Syngergies that can be realized can be plentiful and the cost saving that follow may help or completely finance the acquisitions.

Cutting The Costs When Buying A Competitor

You have an office space or shop so does the competitor.  Can you and your competitor both operate under one roof?  When you eliminate the need for 2 spaces you also eliminate so much of the lease cost, utilities, insurances, phone, internet and other Fixed Overhead cost associated with that space.  Also by adding these customers your customers,  density may increase  and you may be able to increase efficiencies in service and maybe you need 1 less employees or more, along with the benefit cost that goes along with the employees.

Advertising does not need to be duplicitous,  maybe some equipment of vehicles are also duplicated and can be potential cost savings.  As a business broker I try to look at buying selling a business from the perspective of a business owner and see that during this recession improving your position thru acquisition may have many long term beneficial results.

So what do you do when you are trying to keep your piece or get a bigger  piece of a smaller “pie” ?

Buy another piece of that pie it may not cost you as much as you had thought.