June 29th, 2011 by admin

Selling a business in which you have put your time, efforts, and money is not an easy task. Big bucks are in stake while selling business and it calls for sound decision-making. There is a huge risk of financial loss involved in case you are not able to recover what you have invested in the business so far. Therefore, it is important that you prepare yourself well before you plan to put your business for sale. Listed below are few points that you should keep in mind before preparing to sell your business:

• Selling your business is a risky affair and should not be done in a rush. Give yourself enough time (at least a couple of months) to prepare your business for sale. You need to tie-up all loose ends, and make a proper list and evaluation of business inventor and assets before you sell them.

• Check your historical financial statements to ensure that they are in place. Also go through the current year’s audit reports and other financial statements to check that all the financial reports are up to date.

• Make a proper formal records of all the business related documents and the dealings. This will help the new management understand the business better and avoid any sort of confusion.

• Don’t leave any deal with a customer open. Close all the deals before you hand over your company to the buyer. Also, inform all the customers about this new acquisition beforehand.

• Take care of contract details of both suppliers and franchisees. Make proper documentation regarding this and keep a copy of this for the new management.

• Unwritten rules are difficult to follow. Therefore, take care to print record of company’s rules and guidelines. This will help the new management to abide by the policies which the company’s employees are following.

• Make a clear list of assets that are included and excluded for sale. This is important to avoid any discrepancies in future.

• Check your lease contract. In case the location or property lease can cause a problem for your business sell, consider moving to a better location before selling your business.

• Upgrade your computer systems and software up to date before selling the business.

• Keep a good business broker by your side that can help you make good business decisions.

By adhering to guidelines mentioned above, you are sure to feel confident regarding your business sale. Being informed and ready with all the system in place help you avoid the pitfalls of bad business deals.

Business, Selling

June 28th, 2011 by admin

Buying or selling a business is a complex matter. There is no question about it. The complexities start from the moment a buyer and seller start interacting but there is natural conflict in place. For a start, the buyer doesn’t have any history of the operation of the business and so has to rely entirely on the representations of the seller. Conversely, the seller has lived and breathed the business, knows its upsides and downs including its strengths and weaknesses. My Golden Rule when assisting with a business transaction is for each party to put their feet in the shoes of the other party. In other words, the seller should see things from the buyer’s perspective and the buyer should see things from the seller’s perspective.

A key way this would help a business transition from a seller to a buyer would be if the seller used a Management Plan. What you may ask is a Management Plan? From my perspective, a Management Plan is where all the critical areas of a business are summarized so if the owner of the business wins the lottery and never wants to work another day in their life in the business and not come to work tomorrow, the business will survive and grow.

What are some things to include in the Management Plan? At a minimum the Management Plan needs to include a summary of key business information.

This includes the following:

1. A current and monthly updated summary of all the employees in the business. The rule should be that if any employee needs to be contacted, their information should be available in less than one minute. This information needs to include emergency contacts of each employee, if they are willing to provide it and your State government agency allows you to collect it.

2. A current and monthly updated summary of all suppliers. All suppliers may be too much but at least the suppliers that supply any critical materials or provide more than 5% of the company materials.

3. A current and monthly updated summary of all business support services such as the CPA, attorney(s), financial planner(s), landlord, lenders, government agencies in case any are needed urgently.

4. A critical document that would help any buyer is seeing the business Training Manual. Again this document should be kept up to date and break down each of the current positions of the business. If the business doesn’t currently have this document, start creating it. It’s very easy to do. Have the current person encumbered with that job write down what they do. This is then presented to another member of the business with the instruction to execute what’s provided. If they can do it then the jobs done. If they can’t, it goes back to the person who wrote it for re-writing. If some employees don’t want to write the document as they are concerned they will be let go because anyone now knows how to do their job, hire a student from a local college to come and write things up or hire a technical writer.

5. In addition to the Training manual, put together an Operations manual. Michael Gerber is the master of written procedures. He’s written numerous books including The E Myth and The E Myth Revisited. Very simply, Michael Gerber believes that being a true entrepreneur is being able to take an idea and break it down and writing to the point where each person in the enterprise clearly knows what they need to do to collectively make the enterprise successful.

This is the purpose of the Operations manual; to clearly state the business process to achieve an outcome. Would you like an example? Let’s go with the example of a fast food restaurant that sells hamburgers. Let’s choose the person that makes the fries. The Operations manual would break down each step of that process. It starts with where to get the fries, what to do when the quantity of fries in the storage area gets to a critical point and what to do to order more; what temperature they should be stored. The next steps would detail what temperature the oil needs to be to cook the fries, for how long and in what container. Now detail what to do with the fries when they are ready, how much salt to add and in what container to place the cooked fries. Where the containers are stored and what to do when you reach a minimum threshold? You can do this in more detail but the beauty is that once this is done, it only needs to be checked say monthly and now on a consistent basis you can cook and deliver the best fries in the world.

It may seem like a lot of work putting these things together. These suggestions are the tip of the iceberg. What else can you document to make your business easier to operate? Using technology can make doing this so much easier. And remember to make sure you have a backup so all your hard work is not lost.

The most important reason to do this is that by creating this Management plan, your business will be of more interest to the right business buyer. In real estate, there is a rule called the principle of comparison. In simple terms it says that when a buyer is looking to buy a house, they will buy the best option not only on price, but also comparing it to other houses for sale in that area. If the buyer wants a 3 bedroom, 2 car garage, 2 bath house in a specific school district and they have 3 to choose from, they will not necessarily make their final decision on price but it could be features, for example, because one has a swimming pool… or not. The bottom line is that a strong and clearly laid out Management Plan adds value to a business being sold.

Part 8 of this article series looks at the value in creating a Productivity Plan and its importance to defining what and how things need to be done so the business is successful.

Business, Buying, Selling

June 26th, 2011 by admin

I especially hate it when I am placed on hold and I have a spat with the company. Unfortunately this will be happening in your business as well, people having to be placed on hold. With an irate customer the following will most likely not work, but will surely work with a customer inquiring about your company.

A lot of companies have a dreadful hold service. They either play some dreadful old tune or some radio station with no tone. Or even worse they have a computer voice telling you to “please hold, your call is important to us”. Yeah right.

Well if this is your hold message then you are losing a golden moment to actually promote your company and specials that you offer. You can even make it that only the person that is on hold will hear about the special offer and you can even inform them as such. Now imagine how special that person will feel on hold. Even a free be will do very nicely.

Just tell them that they must get their special coupon code from the next consultant that answers. See how your bottom line increases. Even make it a mystery gift but please ensure that the gift is actually worth it, don’t try and give them junk.

Most of your customers will actually ask you to place them on hold. Also insure that you change the gift often. Even if some customers get more than one gift every month. You’ll have customers for life and the viral effect will spread like a wild fire.

Make sure that the gifts that you give have something to do with the products that you sell. They must compliment the product.

Remember even when giving gifts for free you need the message to be short and sweet; most people don’t have the whole day for the hold message to finish.

You can even change the message to cater for after hours. Should the person leave their details they will be contacted the next business day and a free gift will be offered for the inconvenience of not finding your business open.

With today’s technology the holding system can actually generate a coupon code automatically, which the customer can use at their earliest convenience.

Now isn’t this a low cost way of attracting customer. The hold time used to be dead time and space.

Can you afford to get customers this easily. So what are you waiting for?

Steve Watson enjoy building websites which are product based. See for yourself. Click a few links to navigate.

Leave a comment of you like it.

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Business, Selling

June 26th, 2011 by admin

Selling A Business in Auckland – An unfortunate story

I’m going to share a true story from a few weeks ago – it was a phone call between myself and a lady I’ll call Sue.

Sue phoned me in response to one of my own marketing campaigns – “a fax blast”, where I’d sent a fax of a professionally written (and in part fictitious) newspaper article to a group of business owners to get their attention and to get them to ring me. Sue was one of the business owners who rang me. I’d had a number of positive calls from a number of business owners and from there I’d secured new clients, all after using this one single marketing tool as a way to get the attention of some very busy individuals.

All in all, the marketing campaign went really well, all but for this one story – Sue.

So back to Sue.

Sue: “Hi, yes well my husband has made me call you because he thinks we need some help”

That was my first clue that this call may not go in the direction I’d expect this call to go.

I asked 10-15 minutes of questions to find out where their main business challenges were so I could start to learn more to be able to help, and after understanding that her main competitor was outperforming her company by more than tenfold “but they are not as technically competent as we are” I shared a number of quick fire business ideas to assist, all very positive, all would have helped her business, her response was:

“This is nothing I don’t already know”.

OK.

So with phone in hand, pacing around my office, I literally took a step back to take stock of the situation:

1. A business owner has phoned me for help
2. I’ve shared some focused ideas that I know would hugely and positively impact her business, and
3. I receive the sharp response.

OK.

I now understand.

I politely ended the call by suggesting she talk to her husband, and ring me back if they agree they’d like to meet. She and I both know we’ll never talk again.

There are lessons in every situation, and this one has two really good ones.

The first is: “You can’t help someone who doesn’t want to be helped”.

I’ve learnt that in my coaching training and when applying the principles – don’t spend time with those who don’t value your time, there are too many others out there who would enjoy spending time with you and benefiting from your experience. Life is far too short.

That was lesson 1.

Lesson 2 was marketing focus.

Sue’s competition was DVS – a company well known across NZ because of their solid marketing & branding, radio & TV adverts, where the words and pictures are all focused on the benefits of the home ventilation system – how it “removes the steam and excess water from your home, making your home a more healthy place to live, for you and your family”. They were the first company to really focus on the benefits of their system and they have performed really well for a number of years.

I wonder what would appeal to the mums and dads at home:
1. “I’m more technical and know how to install your system, come to me”
2. “My system will make your home a healthier place to live for you and your family.”

In case you’re wondering, it’s option 2 every time, because it appeals to 90%+ of the decision makers of home owners – appealing to their life, their family, their home, their style of living, to name a few. All being improved by ‘this system’ – great – I want one.

That’s why DVS is outperforming Sue in tens, even hundreds of multiples.

One company understands their market, and the message needed to resonate with their market, through the benefits of their product.

It’s not a fair fight.

And I feel sorry for the husband.

So why did I share this story? Because I don’t want you to be like Sue. I don’t want you to unnecessarily struggle in business, when there is help close to hand, you just have to know when to ask for it.

If you want to avoid being like Sue, and want to take positive action, then why not join the group of business owners and entrepreneurs who are collaborating together on areas of improvement under my guidance – I’d love to be able to support you to achieve more in your everyday.

To be different to Sue, to get ahead in your marketing to ensure your business is worth as much as possible when you come to sell, visit The Profit Partnership today.

Business, Selling

June 25th, 2011 by admin

Just as there are different sellers with different motivations, there are also buyers with different types of needs and personalities. If you’re the seller of a business or looking to buy, understanding these different personality types may help you be more successful.

1. Unemployed

This is the best type of buyer. But there are some catches. They need to have enough money as a down payment to buy the business. Zero down payment to buy a home hasn’t been successful. As well as the down payment, they need a good credit score (FICO 700 plus), good credit report and if they want to qualify for a third party loan such as an SBA loan; they need to have industry experience. If you are the seller of a business, the unemployed are motivated and generally want to move quickly to make a decision and start earning an income again.

2. Engineer

This will be the hardest buyer that you work with. They invariably have the money and the skills to run a business, but they have a need to know absolutely every piece of information about the economy, industry, and your business. Many meetings are required and each is long and laborious. Questions that are answered in the first three meetings are asked in subsequent meetings and if the answers are slightly different from what was said earlier, the buyer wants to know why and then go back and revisit every other question around that topic. Their chances of taking the emotional risk to buy a business are very low as after all the questions are answered, they find it impossible to commit by signing their name to the check to buy the business.

3. Talker

This person loves to talk. They have great personality and charm and you think they are the perfect person for the business. They are pleasant to deal with, ask polite and relevant questions, are genuinely interested in being liked and making sure they fit in. There is only one problem -they don’t have any money and can therefore be a huge time waster. Watch talkers carefully as they are such good talkers that you may be afraid to say no or offend them.

4. Know-It-All

Another problem buyer is the know-it-all. They are like talkers but not as diplomatic. They have a bunch of knowledge making them sound like a great candidate as they “get it” and the industry and your business. They probably have money, it is just that they are hard to get along with as they love to tell you what they are going to do to make the business better and at the same time they have no problem in suggesting changes you should make now or telling you what you are not doing right.

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Business, Selling

June 24th, 2011 by admin

Most business buyers and sellers are unprepared for the level of human psychology involved with selling a business.  The reality is that unlike many other investments, the sale of a company is one where human irrationality can many times trump hard facts.  The key is to understand this reality and to deal with advisors who understand this and have the relevant experience to guide you through the transaction.  This article will examine some examples pertaining to when psychology and emotion can interplay within a deal dynamic.

Timelines are important
When you go about selling your business it is critical to respect timelines.  Over and above the legal requirement pertaining to a purchase agreement or a letter of intent, timelines matter because buyers get nervous and delays that pertain to the waiving of conditions or closing can jeopardize a deal.  Buyers are human and they do get cold feet.  Nothing material may have happened to the business to cause a purchaser to back out of the deal but sometimes they talk to friends or family or other people who are not qualified to advise them and the buyer may allow doubts to be cast into their mind.  All other things being equal, for a seller it is better to close a business sale sooner rather than later.

Sometimes professional advisors do not heed the emotion & psychology involved in a deal
A prime example of this is a lawyer.  A lawyer is a professional that is crucial for when a business is sold.  He or she will gave you legal and practical advice regarding the sale but they do sometimes overstep their expertise and give opinions when they don’t have all the facts at hand.  Again, they are removed from the intimate contact between a buyer and seller and not be privy to the emotion and normal deal jitters that a buyer may have (even though they may be unjustified).  Again, the principle of, all else being equal, sooner is better than later.  Get the business purchase agreement executed as soon as you can and don’t let unnecessary delays happen.  Business for sale listings do get stale if they don’t move along quickly enough and delays can impact a buyer’s emotions and perceptions of the deal.

A business broker can help you gain perspective
A business broker typically has a depth of experience when it comes to selling a business.  Always rely on your professional advisors and do not rush a deal so as to put yourself at increased risk.  But do heed the advice from knowledgeable (and ethical) business brokers.  They will be able to give you a perspective that an attorney may not.

In many sales, time is of the essence.  Buyer psychology is intrinsically interwoven with the time required to execute an agreement and generally move things along.  Conditional periods that drag on and lawyers and other professionals that do not move quickly enough can have a negative outcome on the sale of the company.  The key point to remember is that you are ultimately the client and are in charge.  Be prudent and stay protected by heeding professional advice but don’t let negativity and delays dictate the way your sale progresses.

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Business, Selling

June 22nd, 2011 by admin

Are planning to sell your business and engage in a new 0ne? Opening a business and making it triumphant encompasses a great deal of work, but occasionally it gets irresistible and you feel that selling it is the best option for you. While the existing business market is unstable with the global downturn affecting everything, you still have a good chance to sell your business. Even if you settle on to wait until the market is in a better state, you can be start establishing your business for sale. At this juncture, here are some factors to regard while organizing to sell your business.

1. If you have any troubles within your company whatever, try to get them determined as soon as you can. Try to talk to any business associates about major decision relating to the business and its sale, and make confident that a buy and sell agreement is in put before any sale is settled to make sure a smooth transition.

2. Effort on getting all of your monetary papers up to date and as precise as doable. This is a great way to amaze the buyer of the businesses insight, and it will help induce them that the business is important as the worth you are asking for it. It’s best to be up obverse and truthful about all aspects of your business as well. Even if there is something negative in the businesses history, not revealing it could lose the sale.

3. Be ready to help finance the sale of your business, since the current financial conditions could keep the purchaser from getting support put into place. You can also begin looking for a reliable commerce broker to help you in your search for buyers. They will be able to be eligible the buyers for you based on their economic reliability and their capacity to successfully run a business.

4. Talk about with the business broker the price you should be asking for your business. They have all of the expertise needed to help you determine a price for your business that is based on the current economic conditions, how the marketplace is moving, and how a sensible price will help you sell your business instead of leaving you out in the cold because your price is simply too high.

At the same time as waiting for the business to sell it is worthwhile to keep the business running as professionally and advantageously as possible, letting the business broker hand over the sale for you. They are functioning on your behalf and by allowing them to handle all of the sales aspects for you.

Business, Selling

June 22nd, 2011 by admin

There are actually several modern and up to date business marketing plans and strategies in the market nowadays that businesses can use in advertising or promoting their business image. This can range from the lavish multilingual sites in the internet to high class and expensive television marketing campaigns. However, not all businesses can afford these expensive strategies. When portability, affordability, and effectiveness are what you look for in a marketing material, then what you need is the business card.

An attractive and excellent business card can make a good impact to your clients and customers and can deliver your full contact details and information. This is why most business establishments today use business cards as one of their main advertising strategy. Colored cards are the trend these days as they are appealing and eye-catching, and cover a wide range of styles and designs.

Every time you will meet a prospective customer, offering them an elegant and convenient reminder how they can see or contact you is one of the most crucial things of making a good and positive impact. So, make sure that you will not forget your business cards as they are a very effective means of getting your target clients and customers interested in your business offerings. Whatever you are offering, keep in mind that it is very crucial for your cards to have a strong visual impact and appeal. Your cards may require help from printing companies in order to create a professional output, however, it is important that you choose carefully the printer that will produce your cards.

Your cards must not only have your contact details and information, but they also must have an eye-catching look to attain remarked interest from potential clients and customers. If you do not know to achieve this yourself, you can always turn to a reliable printer. Business establishments that offer printing services will take your suggestions into account and come up with their own ideas to aid you in your design. You will also be presented with different printing choices such as the colors to use, paper choice, and printing technique. You will select the one that you think will help you effectively sell your image to your target clients and customers in the market.

As your business improves or expands and begins to offer wide arrays of products and services, it is a must to keep your business marketing tools especially your business card templates up to date. Usually, dealing with your promotional or advertising strategies on your own can be a complicated process. Many business owners have tried and failed to make their own professional looking cards using their personal computer and printer. Keep in mind that home or office printing does not always work to your advantage. For a lesser cost, you sacrifice the identity and image of your business.

There are online printing companies who can help you in your print job. Once your card design is ready for printing, you can order as many as you want. Ordering in bulk is often less costly than ordering in small quantities, so you might want to order in large numbers. Before you know it, your cards are delivered to you and waiting to be put to good use. Online printing companies are here to help you. Get their services and you can be sure to produce professional and high quality cards.

Business, Selling

June 21st, 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

June 19th, 2011 by admin

These days, selling a business requires as much planning as starting it. After all, you spend a great deal of your precious money and time on setting up a business; and obviously, you would not like to sell it for a loss. Not surprisingly, experts say it takes a business owner a minimum of 5 years time to implement a successful exit plan strategy.

There could be various reasons for selling a business. You could be compelled to sell a business because of bankruptcy or some emergency or natural disaster that may have disabled the business to operate. Or you might be thinking of selling a business to go into retirement.  Or better still, the plan might be to start a new business by selling the present one.

Usually, businesses do have some logical successors, especially the family owned businesses. But typically, the small and medium sized entrepreneurial startups do not have the luxury of logical successors. Hence, such entrepreneurs or small business owners are left with no option other than selling the business.

Whatever the reason, you need to chalk out an effective exit plan that yields profits for you. Here are a few things which you need to consider when you plan to sell your business:

Keep everything up-to-date

Selling a business is like selling a house. When a house is up for a sale, don’t you clean it up, give it a fresh coat of paint and make it presentable? Similarly when you plan to sell a business, keep everything organized and ready, right from the infrastructure to the financial records. Even if you are no more interested in running the business, you would still have to keep the financial or business records updated, keep the premises spic and span and the inventory full; in order to draw potential customers.

Check your facts about what you seek to sell

Selling a business doesn’t only mean physical assets. It includes trademarks, goodwill, clients list and so on. You have to determine whether you want to sell everything in the corporation or not.

Greater revenues

Place yourself in a buyer’s position and ask yourself this question: ‘Will you buy a business that doesn’t guarantee great revenues”. The answer will of course be NO. Can you then expect to attract good buyers if your business is not bringing in large revenues?

The key to getting good buyers and an expected price lies in maximizing your operating profits in the run up to the sale of the business. If you require proper guidance on how to maximize revenues, you can join a CEO peer group in Atlanta or any other city in which you operate. CEO peer groups are one of the best ways of getting practical guidance, especially if you are yourself a CEO, President or General Manager who does not get the right kind of support or honest opinions in his/her own organization.

Minimize risks

If you are confused about what you can do in your business to draw potential buyers; start thinking from a buyers’ point of view. No buyer will buy a business which involves big risks. Identify what needs to be done within your organization in order to minimize risks. Besides reduce your liabilities as much as possible and settle lawsuits if you have any.

Chalking out an exit planning strategy is not as easy as it appears to be. Therefore it is always a good idea to become part of a CEO peer group which can assist you in effectively carrying out an exit plan. CEO groups in Atlanta or any other city consist of CEOs, COOs and other top level executives who meet once a month to share their problems, business ideas and exit planning strategies. They counsel each other and give each other honest, no-frills-attached opinions and suggestions. Here you can expect to get practical ideas about how to conduct an exit plan.

Most of the time CEOs are so busy in managing their own businesses that they don’t get time to plan exit strategies. That is why it is all the more necessary to join a CEO peer group and take help from people who have years of experience behind them and can offer you practical advice and not just bookish knowledge.

Business, Selling