Tag Archives: Sell a Greenville Business

Selling Your Business Not to Donald Trump

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Selling Your Business Not to Donald Trump

selling a business or buying a business

selling a business or buying a business not thru a rearview mirror

Donald Trump has bought many businesses in his career. He has sold many as well.  Most business Owners looking to Sell a Business have not sold a business before.   Likewise the majority of those that buy a business have not bought a business as well.

Like with most statements there are exceptions to the rule.

There are many Strategic Business Buyers that make multiple Business purchases within a year.  Sometimes a business owner had sold a previous business as well.   But from all my experiences involved with business buying and business selling over the last 25 plus years the majority of business sellers are selling a business only once maybe twice in a lifetime.

As a prior business owner and a current business owner and a buyer of multiple businesses, and a Business Broker in South Carolina and Florida I recognize the benefit of hindsight.  We all know in running or growing a business, we make mistakes.  We dont know it all.  But we know more than we did 10, 20 or 30 years ago.   How good can one be when doing things for the first time?  Very often you just don’t know what you don’t know.

Buying or selling a business is not a perfect process.  Things can and will go wrong during the process of buying a business and selling a business.  Things can and will go wrong while running a business.

I have never witness a Perfect Business being sold by a Perfect business Seller to a Perfect Business Buyer.

The goal to buying or selling a business for the 1st or 2nd time in ones life should be to mitigate your situations of “I didnt know that”.   Surround yourself with people that you can trust that have been through the process before.   Ask questions. Seek answers .

Below are some common misconceptions I have come across from both business buyers and Sellers.

  1. Business Seller- ” I want 100% of my Selling price to be paid at closing. I do not want to offer any financing”- To that I say- We All Do.  We all want to be paid completely at closing-” How do I know Buyer will pay me”.   Buyer will say, “what assurances do I get that this business is what I think it is.  “Without looking at sales of businesses over last 5-10 years I would venture to say that 80-90% or more of all business sales involve financing from SBA Lender, Seller, or other 3rd party financing.  -As a business broker  I seek to secure “SBA Lender Prequalification” for a business I am representing to sell.  The quantity of Buyers willing to pay 100% cash for a business is minimal.  The amount of prospective buyers that are willing or in the position to pay a down payment and finance the balance is significantly greater.
  2. Business Buyer- “I’m buying a business, so either the Seller meets all my demands or I walk.”  Normally a business Sale involves some “give and take”.
  3. Business Seller- “Let the Buyer make an offer then I will provide that information.” – Certain information is needed in order to make an offer. Not all request are reasonable- the responsibility of an advisor is to “advise” on what may or may not be a reasonable request.
  4. Business Buyer- I found the right business, but I am going to wait to see if they reduce the price.- Finding the right business is not an easy task. If I find the business I am looking for, I am going to pull the trigger or else deal with the remorse of missing out on this opportunity.  I’ve done that before, and wont again.

So what are some key take-aways when looking at buying or selling a business for the 1st time?

Know what is important to you.  Know your timing.  Seek advice of trusted advisors.  Ask questions. Measure twice, cut once.  Mistakes can and will be made.  Not Doing your best to mitigate those mistakes could be your biggest mistake.

For More information on buying or selling a business, business value points or transition/exit strategy please feel free to contact me Scott Messinger at (864) 210-8226  or (239)770-2421 – Scott@GatewayBusinessAdvisors.com

 

Selling a Business to a Soldier

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Selling a Business to a Soldier

I am a Businwww.SellaBusinessFlorida.comess Broker in South Carolina.   I had been a business broker in Florida for 8 years.  at that time, Most of the business I represented to Sell were in the state of Florida and many businesses I represented for Sale were in the Jacksonville Florida area.

Buyers of businesses come from everywhere.  Prospective business buyers    come from right down the street and  from elsewhere in the State.   Very often business buyers buying a Florida business or South Carolina business come from another state.  Currently I am working with a business buyer from Ukraine.  I am also working with a soldier stationed in Afghanistan that contacted me regarding a Meat Shoppe I have for sale in Jacksonville.  This 12 plus year military vet, while still serving, has extended an offer to buy this business I represent for sale.  The Seller has accepted the offer and potentially this person that has spent the last 12+  years serving the USA military,  will be a small business owner after his final discharge date.  It is potentially a life changing event for him and his family

Every business sale I see as unique  with its own unique set of issues, challenges, and obstacles.  Some business sales have less obstacles than others, but they all have obstacles.  Selling a business to a Solider that is currently serving overseas brings on its own unique set of challenges.

Observations about Selling a Business to a Soldier-

  • This prospective business buyer is seeking an SBA loan we think we do have a good lending source lined up that is working hard on behalf of this veteran,- I have yet to locate any special lending programs for military veterans, and find that surprising.
  • As many know prior experience  in the industry is a standard requirement of SBA lending.  again I was surprised that the experiences in the military do not carry more weight in the lending community.
  • Obviously the logistics of calls, emails, faxes, signatures,  along with the big time zone difference and  are just not as easy as me working with a prospective buyer in Chicago Il.
  • Business sales that are contingent on appraisals, loans, and standard due diligence are the norm.  Drafting an offer that is contingent upon “not becoming another statistic before being  scheduled to leave theater “(Afghanistan) brings a new and sobering  element to the process.

On a somewhat related note, yesterday I volunteered at an event in Jacksonville Florida  called Hired Our Heroes.  (sponsored by the US Chamber of Commerce Foundation).  It was a job fair and workshop geared towards transitioning  Military veterans.   My role was to help military veterans that are preparing their transition to “civilian life”.  I also assisted with resume reviews and providing a “civilian business owner perspective”. During my 20 years as a business owner I interviewed and hired 100’s of employees and prospective employees.  At this event I had the chance to spend time with what turned out to be very qualified individuals.  One individual had a very lengthy resume.  We spent a lot of time  trying to simplify it and cut it back.  Problem was that during his 21 years in the military he had  managed  and coordinated so many impressive feats that his resume was long because he has accomplished so much.  Another I spoke to inferred not wanting to point out his involvement in “hostile environments” as he thought this may dissuade a prospective employer from hiring him.  He had been advised that this may be viewed as a negative from a prospective employer.

Our military is and has been producing so many impressive individuals.   Buying a business as a soldier should be a plausible and viable transition.  But pursuing buying a business   as a soldier has its own special challenges.  I think more could be done to assist a soldier  that desires to own a business after their time serving our country is completed.  In this case am I, the lender, and the Seller working a little harder because this prospective business buyer is currently serving our country?- yes.  But after working on this business sale I think  pursuing  the dream of owning a business after serving our country should be easier and more common place.

What does a South Carolina Business Buyer look like

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What does a South Carolina Business Buyer  Look Like? 

South Carolina Business Buyer

What does a Business Buyer look like

Are you a Business Seller Looking to Sell Your Business and wondering what does a South Carolina Business Buyer Look Like?

Do you represent a Business Seller and are looking for a business buyer for your client- What should you look for in a business Buyer- What Does a Business Buyer Look like?

I am a   Business Broker  working with both business buyers and business Seller in Anderson, Greenville, Spartanburg, the Upstate and the state of South Carolina.  I am also a Business Buyer.  Prior to being a business broker I started and owned my own business of 20 years and utilized business acquisitions along with organic growth to advance my business.  I had bought multiple businesses as a strategic business buyer.  I am also a business Seller as I actually did sell my own business.  The “Business Buyer”  I sold my business to was represented by a business broker and we experienced a successful business transition.

The person that bought my business is a business buyer -He is not a Business Buyer Prospect.  So much of the work and efforts involved with the process of buying and selling a business is the extensive involvement with Business Buyer Prospects.  Very often “business buyer prospects”  are referred to as Business Buyers. There is a significant difference between a business buyer and a prospective business buyer.  Each deal has 2 sides- a Buyer and Seller.  I like to use the term Business Buyer Prospect for someone contemplating an acquisition.  Most Prospective Business Buyers dont buy a business.  Various business brokers, M&A people, and related professionals have  their own personal experiences as to how many “Business Buyer Prospects” turn into actual “Business Buyers”.

Personally I think that anywhere between 75 %-95% of those that state an interest in buying a business do not buy a business.  So approximately 9 out of 10 (plus/minus)  of these “Business Buyer Prospects” never become “Business Buyers”.

SO What does a Business Buyer Look like?   How do they look different than the 75-95% of the “Business Buyer Prospects” that do not buy a business.

I contend that looks have nothing to do with what does a business buyer looks like.

A Business Buyer Acts a certain Way. A Business Buyer acts different than a Business Buyer Prospect.

What Does a Business Buyer Act Like?

1)     They have a plan-  “When you buy the business in South Carolina ,and you now live in Chicago-How will you run the Florida or South Carolina business?”

Business Buyer Prospect- “I dont know”

Business Buyer- ” I just sold my house and have a lake home in Anderson South Carolina and plan to move there in December”

 

2)     They have funds or funding plans-  “How much money do you have available to buy a business?”

Business Buyer Prospect- ” If I find the right business- I can get the money” or ” Im not sure yet”,”I’m not worried about that yet”

Business Buyer- “I have x amount available for down payment on a business, so I know what the maximum I can spend and need to find a business that fit this budget”

3)     They understand  certain information will be required from them-

Business Buyer prospect- “why do I need to sign this NDA and give you some financial or background information on me? I just wanted to know what the Sellers Taxes look like”

Business Buyer- ” I have returned the requested NDA and personal financial statement. what is our next step”

 

4)     They ACT,they make necessary steps/moves to move the deal forward

Business Buyer Prospect- ” Yes that business looks to be exactly what I said I was looking for but think I will wait to see if Seller drops price or another opportunity becomes available.”

Business Buyer- “Yes that business looks to be exactly what I said I was looking for- what is the next step so I can get closer to ensuring I dont miss out on this opportunity.

 

What does a business buyer look like? – They are tall, short, fat, skinny, young,old, wearing shorts, wearing dress pants, wearing a dress, have tattoos all over their body.  They are from many different backgrounds,  they are many different religions and races. They look “normal” like you and I.

When I was growing my business though acquisition and I identified an acquisition opportunity I would worry about not securing that opportunity.  I made the decision that the opportunity was good for my company and would be disappointed if I missed out on that business opportunity.  I knew I needed to ACT like a business buyer.   You wont know what a South Carolina business buyer looks like based on appearance, “business buyer prospects” and “business buyers”  look very much alike.  Are you looking to sell your business?  As a business Seller you will know what a business buyer looks like by the way a business buyer acts. Are you a prospective “business buyer prospect” and are you genuinely looking to buy a business?  I could suggest that you act like a business buyer and you will both stand out from all the others out there looking and also achieve your goal.  Are Looking to Buy a Business in South Carolina?

 

 

 

 

 

 

How to Sell Your Business-Two Most Important Ingredients

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How to Sell Your Business-Two Most Important Ingredients

How to Sell your business very often  involves many many moving parts and finding the right Buyer for your business can be a very involved process.  Do you use a business broker to sell your business?  Do you try to sell your  business yourself?  These are just a couple of the initial questions a business owner must answer to begin the process of selling ones business.  When selling a business it is easy to think that I will sell my business to “the first person to comes along with enough money to pay my asking price” .

The Right Conditions For Selling Your Business

The sale of a business involves many terms and conditions by both the buyer and seller that must be met to consummate in a sale.  Very often as you go thru the process of due diligence by both the buyer and seller, wants and needs are uncovered, and potential roadblocks to completing the sale can occur. Two important elements have a very strong impact on increasing the likelihood of a successful sale of a business.

When trying to sell your business are you working with:

An Interested-Qualified Buyer?.

  • An Interested business buyer
  • A Qualified business buyer

As a business broker based in Anderson South Carolina, one of my more important responsibilities  when I represent a business owner selling their business is to qualify or “pre-screen” the various inquiries on the business for sale.  There are many people that inquire/ask about a business for sale and probably less than 5% of those buyer prospects actually buy a business at all.

Difference Between Qualified And Interested Buyer

A Qualified buyer can mean many things, but having the adequate available cash, equity, financing, special skillset, proper personal family and life situations are important to establish.

An Interested Buyer is one that wants to buy the business.  They have seen basic information on the business and based on that, if no significant negatives or unknowns surface, they want to buy the business.  There will always be a lot of due diligence, verification, questions and answers, but this buyers desires to see the process move forward.  If my wife and I were looking to buy a new home, and she finds a home that she likes- I am pretty much transformed into an Interested Buyer.

I may turn from looking to buy a home to working to buy this certain home.  Issues may occur when doing the due diligence on buying the home but I task these as issues to overcome, not reasons to get out of the deal- If I am a truly interested buyer (and or my wife really wants the house).

When going through proper due diligence many discoveries and discrepancies can be uncovered.  When you have a Seller that is truly interested in selling their business and you are working with an interested and qualified buyer, issues uncovered in due diligence are not “Gothcha” moments but rather are business related issues that both parties seek equitable resolution and or explanation on. Issues that surface become hurdles but not roadblocks.

Buying and selling a business is a process.  When Selling your business at some point in the process you ascertain that you are working with an interested qualified buyer.  From my perspective, having an interested Seller and recognizing that you are working with a truly interested qualified buyer are two important ingredients towards a successful sale of a business.  Looking to Buy a Business in South Carolina or looking to sell your South Carolina business?

Scott Messinger

South Carolina Business Broker

Scott@GatewayBusinessAdvisors.com