May 31st, 2011 by admin

There are tons of ideas you can put into effect when you sell a business. Here are some more:

1. Start preparing to sell well before you place your business on the market.

In the employment business, some say the best time to start looking for your next job is as soon as you begin your current one. Let’s use that analogy for selling your business. Begin looking at how you can improve its salability right now, even if you don’t have plans to sell. Why even consider adding extra work onto your already full plate? Because you know that your circumstances and plans can change, and this helps you be ready faster and obtain a better price in any selling market environment should you find yourself wanting or needing to sell.

2. Be clear whether you want the new owner to make changes to what you have built.

For example, from time to time, buyers come into the market and buy the parent company of a number of operations and, bringing their ideas of how to improve the businesses, immediately begin to meddle with the fine tuning that makes these companies hum and gives them their value. A change in hours, return policies, treatment of preferred customers, employee benefits, vendors, and all of a sudden, customers evaporate like water on hot asphalt while employees freshen up and shop their resumés. One by one, the businesses close, long-time employees are let go, and the new owners have to make a public apology for ruining a town institution. Then the former owner is interviewed, regrets having sold in the first place, and the whole thing is rather messy. If you want some continuity in how your business is run, plan on it ahead of time.

3. Apply window dressing to the books.

Can you show a steady healthy growth in the various accounting metrics that apply to your business while eliminating potential red flags such as growing accounts receivables or cost of goods sold as a percentage of sales? Do what you can to cure financial defects first, then move onto the more cosmetic areas.

By always being ready to sell, you keep that option open to you. And I’m sure you like having more options in life.

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Business

May 30th, 2011 by admin

Initiating a business is just half the battle won. Its success lies in keeping it going. There are many marketing tools that will determine the presence of your business in the market. The greater the presence, the more successful your business, which in turn will get you the highest returns when you do sell your business eventually.

Why am I Selling My Business?

This is one question every businessman, considering to sell his business needs to ask himself. If the business was started with a fixed period of time in mind then it makes sense to shut shop. This is feasible in a situation where the business is dependent on current market trends. In such a case continuing with the business after the particular tends has passed will only result in losses. Here, it is practical to sell the business. These days it is easier to Sell a business than ever before thanks to the many tools at our disposal.

Reasons to sell a business

There are many reasons to sell a business. The leading reason why people sell is that their business has reached a saturation point and cannot grow any more than it already has. The others could be those of loss of health, moving out or simply a need of liquid cash in order to start another business venture. It could also be that you are tired of it all and want to take a break. At this point as the seller, you have to consider the most important question of all as to how to Selling my business.

Different Ways of Selling My Business

If you ask the question what are the different ways I can Sell my business, you will be surprised at the avenues of options that will open up for you. The best one is of course advertising, both print and electronic. One of the other modes is that of the internet. It wouldn’t be an understatement to say that these days the most powerful way to sell a business is via the internet.

“How can I Sell my business?” is a question that plagues every person wanting to sell his business. With the many options available to him today he will find that the answer to this question is not as difficult as it used to be.

Business

May 29th, 2011 by admin

After years of running a business successfully, there will come a time when you want to sell your business. Selling it though you may find is almost as difficult as starting it, as you will encounter a set of entirely different problems. The best way to make this process as easy and painless as possible is to hire the services of professional Business sales agents. Ideal place to sell a business

In order to earn maximum profit in the sale of your hard earned business, you should aim at getting the highest price for it. For this, you may have to get a feel of the current market scenario to get a rough estimate of the value of your business. Where to sell a business in order to gain maximum profit will be the next problem that you will encounter. Although newspapers and advertisements in the local media are viable options, the best one is the internet where you will find many sites with professional Business sales agents who can do the job for you.

Role of sales agents

An effective sales agent will handle the entire sale transaction or your business; right from its fledgling stage till the entire deal goes through resulting in the maximum amount of profit for you. These services comprise of professionals who are extremely knowledge in the complexities of business laws. There are many such professional services that will handle the sale for you. Following other recent sales in the same industry will give you the best leads on How to sell a business.

Finding the right Sales agents

The internet will give you information on which sales firms are getting the maximum listings which will help you decide on the most suitable Business sales agents. It is best to choose one familiar with selling businesses in the same industry. The apt agency is the one who can give you the best service and at the same time not charge you an exorbitant commission. They should be known for their professional and transparent dealings.

At the end of the day, you need to find the right one that will get the value that your hard-earned business truly deserves.

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Business

May 28th, 2011 by admin

Starting a business requires you to complete a number of steps and make some key decisions. Though part of your overall plan, you’ll need to decide on a business structure, and obtain the necessary licenses and permits. In addition, determining which financing options will meet your short-term needs and long-term goals is crucial.

One of the ways in which you can successfully start a new business without having to do a lot of the planning work is to buy into a franchise. Franchises are companies that are very well known and have many chain stores across the nation. You essentially pay the company to start your branch of their business in your community. Some of the most well known examples of franchises include McDonald’s, Sonic, and Terminix. Many other companies are also franchises, and this is especially popular in the restaurant business. Before starting a franchise, consider the disadvantages of such a deal, but remember that there are many advantages as well.

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In starting a small business you should never think you can do it alone! One of the best ways to insulate yourself against business failure is to find and work with a mentor, someone with business experience who can guide and assist you.

A good resource is the Service Corps Of Retired Executives (SCORE) which can link you to retired professionals who are available to give you advice.

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First, you rarely have to do as much advertising with a franchise company as you would have to do on your own. The company is already popular and people know what to expect when they visit your business. For example, you don’t have to create your own Burger King advertisements or television commercials-the corporate company does that for you. You simply need to let the people in your community know that a new business option is available. Even if you wish to create advertisements for a local paper, for example, the company probably has pre-set guidelines for you to use and, even more likely, a graphically designed advertisement already created. All you have to do is insert your own information, like address. The work is done for you.

With a franchise, you also build off of the company’s overall success. That is, what the company does well across the country, so will you in most cases. You don’t have to worry about developing new business goals or coming out with new products. With the Burger King example, for instance, the corporation will introduce new food products as the company does well overall. You simply order what you need. Again, the work is done for you.

The market research is already done for you as well. You can see if a company has been successful over time before buying into it. You can also get corporate reports describing consumer demographics. This helps you decide if this type of franchise will succeed in your community. There’s less guesswork here than with other types of businesses, and ultimately, if your business fails, you will be able to dissolve your branch of the franchise with less personal loss. It is also easier to sell a franchise to another would-be business owner if you decide it is not right for you. Consider the franchise option. The choice is not good for everyone, but if you want to start a new business with less of the work, you may benefit from a franchise option.

Franchise, Franchising

May 27th, 2011 by admin

With many people living out their dreams running franchises, there’s gotta be something right with the whole concept.?

Literally hundreds of thousands of franchise operations exist, offering some people a chance to become millionaires buying and running them. Many are willing to pay significant sums to get into a franchise — I’m told it costs about a half-million dollars to open a McDonald’s, which by some measures is the most successful franchise operation in history.

All that aside, buying a franchise is not an easy ticket to business success. For every success, there are many more failures, and the business landscape is littered with franchise fiascoes due to conflicts between franchisees and franchisors.

You have to practice the same due diligence as a franchise purchaser that you would with any major investment. In fact, in some ways you have to ask even more questions than you would if you were simply opening a business — because you have to understand issues involving the franchisor, as well as the usual risks involved in opening a business.

Here are 10 key questions I would ask before getting involved in a franchise operation.

1. What’s my upfront cost going to be? This is the most obvious initial financial question. But immediate out-of-pocket costs are only one consideration in franchising.

2. What other fees should I plan on? You may be required to lease property or equipment from the franchisor. You may also have topay the franchisor a percentage of your annual sales. Those numbers must be cranked into your own equations when you’re trying to figure out if a franchise deal makes sense.

3. How is the franchisor making money? Franchisors may make money by owning their own establishments, by providing services to franchisors, by simply collecting initial franchise fees from people like you or by some other combination. It’s tough to make a blanket statement about whether one model is better than another, but surely you want to know where the franchisor’s own interests lie.

4. What restrictions do I have on suppliers? Are you going to be required to purchase certain goods or services from particular vendors and/or from the franchisor? If certain purchases are required, are they going to cost you more than you would otherwise have to pay if there were no restriction on where you could buy them?

5. What kind of regional protection am I getting? Do you have any guarantees that the franchisor isn’t going to sell other franchises or open up its own outlets in your geographic area? If so, how long are those guarantees good for?

6. What kind of empire-building opportunities do I have? The flip side of the previous question: Do you get first dibs on new franchises in or near the same area as your first franchise? Some of the most successful franchisees are those who own multiple outlets in the same area and are able to develop their own economies of scale.

7. How many franchisees fail in a year? You’d want to find out how many (or what percentage of) franchisees close their doors within the firstyear or two years, and how many or what percentage of all franchisees close annually.

8. How many franchisees sell out in a year? A franchisee that gets out of the business by selling to someone else isn’t necessarily included in the statistics of “failures.” Indeed, he or she may be selling a successful venture. But you still need some idea of the turnover rate of franchisees.

9. What’s the value of a re-sold franchise? Another way of looking at the prospects for franchisees is to look at what happens to those who sell their establishments. What did they get for the re-sold franchise relative to what they put into it? Was it a profitable investment, or were they simply looking to get out and cut their losses?

10. How do I get out of this deal, if necessary? Put another way, would you be allowed to sell your franchise? Can you sell to anyone, or do you have to deal with the franchisor? Would the company charge you something to sell your franchise or otherwise restrict your ability to pull out of the business?

Hopefully, you’ll never find out what ultimately happens regarding that last question. But, as always, you need to be prepared for a worst-case scenario. With many people living out their dreams running franchises, there’s gotta be something right with the whole concept.?

Literally hundreds of thousands of franchise operations exist, offering some people a chance to become millionaires buying and running them. Many are willing to pay significant sums to get into a franchise — I’m told it costs about a half-million dollars to open a McDonald’s, which by some measures is the most successful franchise operation in history.

All that aside, buying a franchise is not an easy ticket to business success. For every success, there are many more failures, and the business landscape is littered with franchise fiascoes due to conflicts between franchisees and franchisors.

You have to practice the same due diligence as a franchise purchaser that you would with any major investment. In fact, in some ways you have to ask even more questions than you would if you were simply opening a business — because you have to understand issues involving the franchisor, as well as the usual risks involved in opening a business.

Here are 10 key questions I would ask before getting involved in a franchise operation.

1. What’s my upfront cost going to be? This is the most obvious initial financial question. But immediate out-of-pocket costs are only one consideration in franchising.

2. What other fees should I plan on? You may be required to lease property or equipment from the franchisor. You may also have topay the franchisor a percentage of your annual sales. Those numbers must be cranked into your own equations when you’re trying to figure out if a franchise deal makes sense.

3. How is the franchisor making money? Franchisors may make money by owning their own establishments, by providing services to franchisors, by simply collecting initial franchise fees from people like you or by some other combination. It’s tough to make a blanket statement about whether one model is better than another, but surely you want to know where the franchisor’s own interests lie.

4. What restrictions do I have on suppliers? Are you going to be required to purchase certain goods or services from particular vendors and/or from the franchisor? If certain purchases are required, are they going to cost you more than you would otherwise have to pay if there were no restriction on where you could buy them?

5. What kind of regional protection am I getting? Do you have any guarantees that the franchisor isn’t going to sell other franchises or open up its own outlets in your geographic area? If so, how long are those guarantees good for?

6. What kind of empire-building opportunities do I have? The flip side of the previous question: Do you get first dibs on new franchises in or near the same area as your first franchise? Some of the most successful franchisees are those who own multiple outlets in the same area and are able to develop their own economies of scale.

7. How many franchisees fail in a year? You’d want to find out how many (or what percentage of) franchisees close their doors within the firstyear or two years, and how many or what percentage of all franchisees close annually.

8. How many franchisees sell out in a year? A franchisee that gets out of the business by selling to someone else isn’t necessarily included in the statistics of “failures.” Indeed, he or she may be selling a successful venture. But you still need some idea of the turnover rate of franchisees.

9. What’s the value of a re-sold franchise? Another way of looking at the prospects for franchisees is to look at what happens to those who sell their establishments. What did they get for the re-sold franchise relative to what they put into it? Was it a profitable investment, or were they simply looking to get out and cut their losses?

10. How do I get out of this deal, if necessary? Put another way, would you be allowed to sell your franchise? Can you sell to anyone, or do you have to deal with the franchisor? Would the company charge you something to sell your franchise or otherwise restrict your ability to pull out of the business?

Hopefully, you’ll never find out what ultimately happens regarding that last question. But, as always, you need to be prepared for a worst-case scenario.

Related Selling Your Franchises Articles

Franchise

May 26th, 2011 by admin

Franchises are everywhere today. But are they the ‘way to go? If it’s a Mac Donald’s franchise I’d say “yes” but for probably 80% of the rest, you need to be very careful. My advice is to check out each one on its own merits and ask the following questions: -.Firstly, is this franchise someone’s ‘bright idea’ to sell a franchise network? Is there an existing demand for the company’s products or service? How much competition is there for these products and services? Is the demand likely to grow? This is a point that is often overlooked by budding franchisees. There must be a solid and growing demand for the products or service.

Secondly, what is the franchisor offering by way of ‘support’? Most franchisors oversell this point. When it comes to the crunch (usually after you have paid your franchise ‘buy in’ fee), you find out that what you are ‘buying’ is simply a so-called ‘opportunity’ to own a business in exchange for carrying 90 % of the risk. This risk involves the capital cost of ‘buying a territory’ plus your on-going franchise fees which need to be paid on top of the normal capital required to start a new business.

Thirdly, what are you getting for your franchise fee? The franchise fee is normally 6% of your turnover, of which 4% typically goes to the franchisor and 2% goes towards group marketing of the brand. So what does this mean in practice? If you are operating on say a 25% Gross Profit, then a 6% franchise fee on your turnover represents almost 25% of your gross profit! For example for each 0,000 of turnover, if ,000 is your Gross Profit, then you will pay ,000 in franchise fees, which leaves ,000 to pay all the other bills, leave something for your wages of management and pay a return on the capital outlay that we have mentioned.

I would suggest that this is not a ‘level playing field’, in fact it is heavily tilted in the franchisor’s favour! This is the one big killer of most franchises and for this reason I would generally not touch one (I did once against my better judgement and lived to regret it!)

The exception would be a franchise that was a well-known and proven brand, offers ‘turn-key’ operating systems (Mac Donald’s is the perfect model here), and has a network of happy franchisees, most of whom are making money. If it doesn’t meet these criteria then walk away!

In fact, this is the ideal way to check out a franchise. Before you buy, ask for a list of all of the franchisees (not just selected ones given to you by the franchisor!) and get permission to go and talk to them. Use the above criteria as a ‘measuring stick.’ If the franchisor is not willing to cooperate in this, then walk away (if you have not already done so!)

If you are looking to start a new business, another option is to work from home with the benefits of very low capital outlay and overheads, no staff, no traffic hassles etc. By learning how to use the internet to access 1.5 Billion current internet users, you can make money on-line from the comfort of your home. That has to be a preferable business model.

Related Sell A Franchises Articles

Franchise

May 25th, 2011 by admin

Selling a business much be approached with as much planning and care as you would exercise with any other major business move. Too many businessmen decide to sell, and make a number of mistakes which reduce the price they get. We suggest that you take the following precautions once you have decided that you will sell your business.

One, do not tell competitors or staff or customers what you propose. Begin by placing advertisements in the press which do not identify you. Rumors that you are selling can affect your business badly – and very quickly.

Two, before identifying yourself, ensure that potential buyers can afford to buy your business. Ask for details about their bank and/or financing information. Make sure they have the money to buy you out, and are not just “fishing”. This will eliminate those with whom it would be fruitless to negotiate.

Three, once you have established a number of possible buyers, Google them. Find out about their financial stability, and business history. Find out if buying your business would make sense to them. If buying your business does not appear to make much sense to you, (from their point of view), put them aside for a while. You can always come back to them after you have talked to companies that are more serious.

Four, once you have identified yourself, do not let out too much information too quickly. Do not give confidential information which could be helpful to a competitor unless you are convinced that they are very serious. At this stage, just give sales, net profit before tax, net worth, and general details about the business and the industry.

Five, do not allow negotiations to drag on. The longer they go on, the more information you will have to give, and the greater the chance that word will get out that the business is for sale. However, it is not wise to negotiate with more than one buyer at a time. This can give buyers the feeling that they are participating in an auction. If you think they are dragging their feet, you should indicate that you will commence talks with the other parties waiting. This strategy should provide just the right amount of pressure.

Six, remain cool. Do not display the slightest amount of anxiety even if you are desperate to sell the business. Your outward attitude should be “if the price is right, I’ll sell, if not, I’ll wait until the right buyer comes along.

By following these rules, you will save yourself a considerable amount of time and frustration.

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Business

May 24th, 2011 by admin

You fought through the start up, all of the ups and downs, worked the long hours, remained in business for all those years and now it is finally time to sell your franchise, cash in and reap the rewards. Will you get what you are looking for? It is hard to tell, but for many, disappointment is soon to follow.

One of the common questions prospective franchisees ask during the discovery phase of their franchise opportunity centers on the ability to sell the franchise. Generally, the franchisee is informed that it can be sold just like any other business. That is only partially true. Unfortunately, for the inexperienced franchisee, they will not find that out until many years down the road. While many businesses are sold based upon a multiple of the earnings of the business, this does not always hold true for franchises. You see, in the sale of a franchise, there is another party which must be dealt with, and that is the franchisor.

Just because you want to sell your business does not mean that it can even be sold. Remember, every potential buyer must meet the requirements of the franchisor and the landlord, just as you had to. The next hurdle is the price. This is where things get a little tricky. For basic illustrative purposes, assume the business nets 0,000 and you want to sell it for a multiple of five, or 0,000. Obviously, there are many factors that go into determining worth, so this is just an extremely basic example.

How realistic is it that you can command that price? Well, you will need to consider several factors. First, how many years are left on the current agreement and how many renewal options are left? Does the franchisor have the ability to decline the options? If you do not have enough years left on your term to enable the prospective buyer to get a proper return on the investment, your sale price will be reduced. An independent business does not have to deal with this concern.

A second variable that plays a part is the cost to transfer ownership. Many franchise agreements require the buyer to pay a transfer fee. However, that is not usually the biggest stumbling block. Generally, the franchisor will require that the unit be brought up to the current specifications and will invoke the mandatory remodeling costs to bring it current. In most cases, that amount, plus the transfer fee, will come off of the sale price. If a broker is involved, there is also that fee to deal with.

Finally, depending on the chain, your location and footprint of your building may not fit the current model or look the franchisor is using. Therefore, upon sale, the buyer may be approved however the location may not. The buyer may be required to relocate the business. If that is the case, you really have very little to sell.

All of these factors, plus many more, will play a huge part in determining what you will get for your business, IF you can sell it.

Franchise

May 23rd, 2011 by admin

If your business is a success, you probably had to pour most of your time, energy and money into it for what may seem like forever. You may see your company as an extension of yourself and it may be hard to even imagine life without it. In some cases, your entire family may have depended on the business, discussed it endlessly around the dinner table and practically made it into another family member.

On the other hand, your business may have only been marginally successful. It’s something you can’t wait to sell and get rid of. Or, perhaps you entered into the business with the idea that it would only be a short-term opportunity and that you’d sell it whenever you got a decent offer.

Whatever your situation, selling your business will be one of the most important things you’ll do as a business owner. Unlike virtually every other business decision you have made over the years, you’ll only do this once. You get a single chance to put a price tag on possibly years and years of effort. Once you sign the business sale documents, it’s over.

So, now the question is: Is now the right time to sell your business for maximum profit>?

3 Timing Factors That Will Affect How Much You Will Make from Selling Your Business

1. The Economy – What’s going on with the economy?

Is the economy growing? Is it kind of hanging in there? Are we in recession? If it’s a growing economy, that’s great news for you if you want to sell your business for the maximum price. If there’s a recession, then I strongly suggest waiting if you can. I’m not saying you can’t sell your business for the maximum price during an economic downturn, but it’s much more difficult. So you need to be aware of what’s going on in the macro, in the wider world.

2. Your Industry — What’s going on in your industry sector?

Just like the economy, if your industry’s outlook is growing strong, then now is the best time for you to sell your business for the maximum price. Once your industry matures, the longer you wait to sell your business, the less money you will make from the sale.

When keeping an eye on the industry, you must also look for warning signs, alarm bells and problems in the brewing stage. This includes talks about introducing new legislation either now or later that can affect your business and your exit strategy.

3. Your Business – What’s going on with your business?

Before you decide to sell your business you must ask yourself: Is the business growing, each year? Are you growing in turnover? Are you growing in profit? Is that going to continue? If you’ve got historic growth and the growth is continuing, then you have a wonderful business selling opportunity.

If your business is static or even worse stagnating, going backwards, and struggling to break even then you need to be aware of these facts. It doesn’t mean you can’t sell, but the preparation is probably even more critical because you need to sell and you need to create a good story why you’re selling.

Hitting the Jackpot – When is the Ideal Time to Sell Your Business?

Obviously, the perfect time to sell your business for maximum profit is when the economy, your industry and your business are all growing at the same time. When you’re prepared and ready to sell, then you can control that process and wait for all three to coincide.

When you’re not prepared and when you possess a victim mentality then you sell because you have to sell. All three timing factors will not be in place, and you will not sell for a maximum price, unless you get really lucky.

So, how are you going to start preparing to sell your business?

Business

May 22nd, 2011 by admin

There are many reasons why businesses opt for selling a business, probably because it is the most popular exit strategy for business owners. Businesses normally think of selling a business at some point of time with an idea to convert the business into liquid asset if they do not have any successors who want to continue the business. Few opt for selling the business when it is either running for loss or cannot stand up the competition in the market. Whatever the reason may be, the following tips would help you get the best price for selling your business.

- Calculate the worth of your business -The first step is to determine its correct value in the market. Until you determine the correct worth of it, you cannot fetch the right amount for it in the market. You can opt for different business valuation method to determine its correct value keeping the current market condition, economic trend and value of similar businesses. It is advisable to get professional valuation done for your business, as valuations done by professional people are regarded highly by any prospective buyers.

- Sell at the right time -Selling at the right time is the mantra for fetching the best price. Businesses sell their business when they are not in the condition to run it properly either due to bad health or no successor. Selling at this point of time is like selling a bad debt. Prospective buyers may take advantage of your situation and offer to pay lesser than the actual worth of your business. Hence it is advisable to sell your business when it is doing very well and at its highest profit margin level.

- Fix your House before you sell strategy – We all fix our house properly to make it look its best before we sell it out so that we can earn max. This strategy is applicable in selling a business too. Make sure that the business’s records up to date, the inventory up and the premises maintained. Also, you have taken care of your liabilities and settled all law suits.

- Professional Help – Selling a business is a complex transaction and cannot be done by individuals as it requires lot of paper work, legal formalities and professional expertise. It is the best idea to get professional help in selling your business thatwill simply things for you and you would be able to sell your business without any hassle.

Selling a businessis serious business and requires lot of ground work and validation. The above tips will be handy in getting the best price for your business.

Business, Selling, Tips