Blog entries

How to get more Value for your Business

fsimo@tworld.com — Wed, 11 Aug 2010 19:19:19 +0100

Unfortunately, sellers often ignore one very simple truth: The value of their business increases in direct proportion to the buyers’ decrease in risk. I think this is a very important element of valuation and, as such, should be very well understood by those looking to sell or currently selling their businesses. So, the less risk the more value you may be able to get for your business buyers will compete with price to get at your business. So,Read More...

Buying a Business?--Why Sellers Sell their Business.

fsimo@tworld.com — Thu, 15 Apr 2010 23:36:09 +0100

Recently, I was having a meeting with one of my network colleagues. During our conversation, she pointed out how leery she was of businesses for sale. When I asked why, she indicated that if the seller wants to sell the business is because it is not doing well. I found her response interesting and immediately indicated to her that sellers sell for a variety of reasons, most of which are not related to poor performance, cash flow or profitability issues. Here arRead More...

Buying a Business using 401K Funds

fsimo@tworld.com — Sat, 06 Mar 2010 06:41:57 +0100

How would you like to buy a business using 401K funds--without any tax penalties? The purchase would leverage the government's taxable share of your 401K--therefore lowering your risk--and be effectively tax free on its operating profits. Should you want to know more, please contact me at 407-361-8886 or email me at fsimo@tworld.com. Also, please click here for more information on buying and selling a business in Orlando or Central Florida.

Selling or Buying a Business?--Is there an Economic Upturn?

fsimo@tworld.com — Tue, 09 Feb 2010 22:15:40 +0100

There is no doubt that a major topic of discussion (and concern) today for most of us is the economy. One of the main issues regarding a market where unemployment nears ten (10) percent (or 20% for those who include workers who no longer submit claims or are simply working on a part-time basis, or simply gave up), is whether the recession and/or the recovery is underway. Based on two continuous GDP growth quarters, most economists would indicate that the recession is over—andRead More...

Selling your Business??--What Happens after you Sell it?

fsimo@tworld.com — Tue, 05 Jan 2010 00:08:52 +0100

Ok, so you are lucky enough to have sold your business. Now what? One of the things sellers normally forget is the closing process. In one of my previous articles I mentioned that among the many things Business Brokers do for sellers and Buyers is to manage the closing process once a Purchase Agreement (sale) has been made. As brokers, we normally maRead More...

Selling your Business??--Get it Pre-Qualified!!

fsimo@tworld.com — Thu, 03 Dec 2009 02:33:13 +0100

As I mentioned in one of my previous blogs, the Small Business Administration (SBA) has relaxed some of their policies in regards to lending. I said before that they “became a lot more flexible by making changes to the acquisition policies impacting purchases which included Intangible Assets. These changes give &ldquoRead More...

Buying a Business??—What I recommend foreign buyers to do.

fsimo@tworld.com — Wed, 11 Nov 2009 00:19:49 +0100

Many foreign nationals come to Central Florida to purchase a business in order to get visas into the US on a somewhat permanent basis—so long as the business is viable the visa holder may stay, if not, they may have to get back to their country of origin. The two most common types of visas are the L1 and E2 visas. The L1 viRead More...

Selling your Business??--Consider an Exit Strategy

fsimo@tworld.com — Thu, 05 Nov 2009 00:23:12 +0100

In one of my recent articles, I discussed profitability (Owners Benefit) as one of the key elements in determining a business valuation. I mentioned that if a business generate limited or no cash flow, it normally can only sell its tangible assets—receivables, inventories, furniture and fixtures and equipment.—for a nominal amRead More...

Selling your Business??--Can you sell something with no value??

fsimo@tworld.com — Thu, 22 Oct 2009 03:26:39 +0100

As I go on listing appointments, I caution sellers that there are two ways in which one can normally value small businesses (notice the word “normally” and “small”). One way values Tangible Assets, such as inventories, receivables, furniture, fixtures and equipment. The other uses a multiple of Owners Benefit (Operating Profit plus owner’s salaries, depreciation, amortization, interest and personal benefits charged to the business). In other wordsRead More...

Selling your Business??—Cheap isn’t always a Bargain!!

Thu, 08 Oct 2009 23:15:27 +0100

What is it about most of us who decide that “cheap” is better? We do it when buying clothes, shoes, furniture, car, etc, only to find out, in most instances, that our decision was not a good one. Why?? Because in the very short term, clothes look like hell and soon deteriorate, shoes fall apart and last only a few months, and our furniture rips apart easily, forcing us to go buy the same things within months-- doubling our expense!! We do the same when buying Read More...

Selling your Business??--Focus on your Business, Outsource!

fsimo@tworld.com — Fri, 25 Sep 2009 18:02:46 +0100

During one of my listing appointments, I met a seller who wanted to sell his business in order to improve his quality of life—he wanted to spend more time with his family. According to him, he spent over sixty (60) percent of his time doing things that had nothing to do with the actual operations of the business—the back office stuff. He complained that the forty (40) percent he spent focusing on his business, although enjoyable, was not enough to pRead More...

Buying a Business??--Now is the time!!

fsimo@tworld.com — Tue, 15 Sep 2009 22:22:12 +0100

In one of my recent articles, I discussed the impact the current recession has had on the Business Brokerage world. I indicated that one of the major reasons for the negative impact has been the inability of buyers to get financing to purchase a business, particularly larger businesses-- I recently heard that the average price reduction in Florida businesses sold over the last two years, compared to the previous two years, is between $150-$200K.

Now for Read More...

Selling your Business??--Yesterday is History

fsimo@tworld.com — Sun, 13 Sep 2009 03:14:24 +0100

As we brokers begin the process of selling someone’s business, we normally ask the seller to provide four specific items: Year-to-Date Financial Statements; at least three (3) years tax returns; a list of furniture and fixtures and equipment; the lease agreement. All of these items will provide a piece of the puzzle in valuing someone’s business and determining what the right price for it should be. In this article, I will focus on financials and taxes.

For mostRead More...

Selling your Business—the Power of Analysis and Contribution

fsimo@tworld.com — Tue, 01 Sep 2009 00:46:30 +0100

More often than not, as I go on a listing appointment, the seller looks at me with concerned eyes and makes the following/or similar statement: “My business does not generate enough profit for me to sell it; I really cannot afford to sell for the price that I may get.” This may be a wrong assumption solely based on the profitability of the business.

First of all, the value of your assets, such furniture, fRead More...

Buying a Business??--The Golden Years!!

fsimo@tworld.com — Mon, 24 Aug 2009 17:04:36 +0100

As we move into the golden years, something happens to many of us (yes, it happened to me)—we want to become entrepreneurs! I think that the need to protect the financial viability of the rest of our life, force us into thinking that the only way we can effectively do so is by investing in a business of our own. Please, think it over. More often than not, we lose a significant amount of our life savings, if not all of it. We foolishly use our 401K, the equiRead More...

Business Brokerage—HOW DO YOU KNOW WHEN TO SELL YOUR BUSINESS??

Fri, 14 Aug 2009 04:39:29 +0100

During the week, I had a discussion with a very talented individual whose job is to help businesses “get well” financially through leadership development. He asked for my opinion regarding valuation and exit strategies. The essence of his question dealt with a topic in the mind of many-a-business: when can I sell mRead More...

Selling your Business--DO BUSINESS BROKERS EARN THEIR COMMISSION???

fsimo@tworld.com — Fri, 07 Aug 2009 13:24:46 +0100

Ok, so what in the heck do Business Brokers do to EARN a living?? I really think that very few people truly understand how they add value to the process of selling or buying a business. Although brokers help sellers value their business; structure it for sale; market it (confidentially) for sale; coach buyers; show their business; qualify buyers for financial capability to buy the business and, conduct most of the negotiations. Our job really begins when the buyer makeRead More...

Selling your Business??—ARE YOU “IN THE BOX?”

fsimo@tworld.com — Sun, 02 Aug 2009 01:14:33 +0100

Last week I talked about the Selling Criteria or areas that can make your listing a lot more competitive, such as good financials, proper documentation (i.e.,lease and franchise agreements), equipment lists and others. These are areas that brokers look into to determine how viable and competitive your listing is—looking for the probability of success.

During my discussion last week, I purposely omitted two additional elements (c’mon, I don’t want to tell yoRead More...

Selling your Business and the power of Competition—THE SELLING CRITERIA.

fsimo@tworld.com — Mon, 27 Jul 2009 04:22:20 +0100

More than ever before, the selling of your business has become extremely competitive. As a seller, in this market, you are competing with a greater volume of similiar businesses for sale, buyer's investment choices in this very tight and limited financing environment and, most importantly, the brokers' time and involvement in your listing.

Here, I would like to focus on the latter--the brokers' time and involvement in your listing. By the way, by "broker" I do not mean the pRead More...

So you want to buy a business, heh!!!

fsimo@tworld.com — Tue, 21 Jul 2009 21:46:11 +0100

So you made the decision to buy a business. Now what?? Well, to begin with, I would recommend you get the services of a business broker to help you find the right business—it is FREE. Just like in the real estate market, brokers get paid a commission from the seller not the buyer AND, in most cases, the broker represents the transaction—where he is not an agent of either the seller or the buyer. Secondly, I would really give a lot of thought as Read More...