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Casual Articles - How to Sell Your Own Business
Sustainable packaging addresses performance and cost along with maximizing the use of renewable types of plastic materials or the use of recycling of other various materials like paper or cardboard. I figure the following factors would contribute to cost savings. The use of renewable or recycled source materials; able to manufactured using clean production technologies and best practices; make products from materials healthy in all end-of-life scenarios; designed to optimize materials and energy; effectively recover and utilized in biological or industrial cycles.<
8. After Confidentiality Agreements are executed and you have provided the Executive Summary or whatever information the buyer has requested, you should arrange a buyer visit to further explore the acquisition potential.
9. If they are interested push for a Qualified Letter of Intent (LOI) or Term Sheet. This basically lays out the transaction economics prior to due diligence. The basic concept is that if I (the buyer) can validate what you have told me about your business and find no negative surprises, these are the terms of my purchase offer. It is a non-binding letter and is used to move the process forward. The buyer w
Upon reading of the death of Peter Drucker, I was reminded of the problems of family business, individual accountability, and succession of which he wrote years ago.In the over 30 years that I have worked with family owned businesses there have been so many occasions where the business is on the brink of failure, will fail, or has substandard performance because the company has not been prepared for “up and comers” from the family within the enterprise.All too often family business “up and comers” are unprepared with a lack of financial management or o
PURPOSE: To provide a quick guide to business owners that desire to sell their business but do not want a significant portion of the transaction value to go to a business broker or M&A intermediary.
1. Have an idea what your company is worth. The most common rule of thumb is that buyers usually pay a multiple of EBITDA. The normal range is a selling price between 3 and 5 times EBITDA. There are exceptions to this rule, but if you have a main street business, you generally fall in that range. If you are a member of an industry association, they may be helpful to you in identifying industry multiples or resources that can help you determine a selling price range.
2. Create a blind profile. It is a brief summary of your company and is designed to communicate the key points about your acquisition opportunity without giving away your company's identity.
3. Have a Confidentiality Agreement or a Non Disclosure Agreement executed if a potential buyer shows interest in your company.
4. Create a database of Target Acquisition Prospects. You may already know the most likely buyers, but those most likely buyers may also do damage to your business if they determine you are for sale. Your industry or trade associations and trade publications will be helpful. If you want to expand to those potential buyers to a greater universe, I recommend creating a database using one of the database service. You can do a search by location, company size, SIC Code and other criteria to arrive at your selection criteria. There is a charge for this service or a charge for each company you select, and you have to subscribe and do the search yourself.
5. I personally like to call the prospects because sending a mailing is very ineffective these days. Once I get the CEO on the phone, I try to get their interest with a 30 second elevator speech. If he/she is interested, I ask for the email address and email a copy of the Blind Profile and the Confidentiality Agreement and request its execution and return via fax before any more information is exchanged.
6. Post your business on some business for sale web sites.
7. Have the last three years tax returns that reflect the company's performance available. Create an Executive Summary for potential buyers. A sample Table of Contents is below:
§ OVERVIEW
§ STOCKHOLDERS' MOTIVATIONS
§ GROWTH HIGHLIGHTS
§ BUSINESS SUMMARY
§ MANAGEMENT ORGANIZATION
§ KEY EMPLOYEES
§ CRITICAL COMPANY MILESTONES
§ FAQ's AND ADDITIONAL DETAILS
§ EBITDA ANALYSIS (000's)
§ MARKET BALANCE SHEET
8. After Confidentiality Agreements are executed and you have provided the Executive Summary or whatever information the buyer has requested, you should arrange a buyer visit to further explore the acquisition potential.
9. If they are interested push for a Qualified Letter of Intent (LOI) or Term Sheet. This basically lays out the transaction economics prior to due diligence. The basic concept is that if I (the buyer) can validate what you have told me about your business and find no negative surprises, these are the terms of my purchase offer. It is a non-binding letter and is used to move the process forward. The buyer wi
Mr Right, for lack of a better name, had decided it was time to move on to a new job. He had all of the qualifications: education, experience, accomplishments, industry experience and contacts. He was definitely an "A" player in his industry.So he went about the business of looking, and in short order he had three different companies that were very interested.Company A interviewed him, set up a second round of interviews with top people directly involved in the position he was being considered for, interviewed him and, after checking references - with h
2. Create a blind profile. It is a brief summary of your company and is designed to communicate the key points about your acquisition opportunity without giving away your company's identity.
3. Have a Confidentiality Agreement or a Non Disclosure Agreement executed if a potential buyer shows interest in your company.
4. Create a database of Target Acquisition Prospects. You may already know the most likely buyers, but those most likely buyers may also do damage to your business if they determine you are for sale. Your industry or trade associations and trade publications will be helpful. If you want to expand to those potential buyers to a greater universe, I recommend creating a database using one of the database service. You can do a search by location, company size, SIC Code and other criteria to arrive at your selection criteria. There is a charge for this service or a charge for each company you select, and you have to subscribe and do the search yourself.
5. I personally like to call the prospects because sending a mailing is very ineffective these days. Once I get the CEO on the phone, I try to get their interest with a 30 second elevator speech. If he/she is interested, I ask for the email address and email a copy of the Blind Profile and the Confidentiality Agreement and request its execution and return via fax before any more information is exchanged.
6. Post your business on some business for sale web sites.
7. Have the last three years tax returns that reflect the company's performance available. Create an Executive Summary for potential buyers. A sample Table of Contents is below:
§ OVERVIEW
§ STOCKHOLDERS' MOTIVATIONS
§ GROWTH HIGHLIGHTS
§ BUSINESS SUMMARY
§ MANAGEMENT ORGANIZATION
§ KEY EMPLOYEES
§ CRITICAL COMPANY MILESTONES
§ FAQ's AND ADDITIONAL DETAILS
§ EBITDA ANALYSIS (000's)
§ MARKET BALANCE SHEET
8. After Confidentiality Agreements are executed and you have provided the Executive Summary or whatever information the buyer has requested, you should arrange a buyer visit to further explore the acquisition potential.
9. If they are interested push for a Qualified Letter of Intent (LOI) or Term Sheet. This basically lays out the transaction economics prior to due diligence. The basic concept is that if I (the buyer) can validate what you have told me about your business and find no negative surprises, these are the terms of my purchase offer. It is a non-binding letter and is used to move the process forward. The buyer w
The Olympic Games are a global celebration of challenge, performance and achievement. Around the world, viewers thrill to see who takes home the Bronze, Silver and Gold.I enjoy looking deeper, silently granting ‘Personal Diamond Awards’ to anyone who goes faster, higher or longer and achieves a ‘personal best’.What would the Olympics be like if we officially included the Personal Diamond Awards?Imagine an athlete who wins the bronze medal as well as a Personal Diamond. How would that athlete react? How might the audience respond? Would the bronze
5. I personally like to call the prospects because sending a mailing is very ineffective these days. Once I get the CEO on the phone, I try to get their interest with a 30 second elevator speech. If he/she is interested, I ask for the email address and email a copy of the Blind Profile and the Confidentiality Agreement and request its execution and return via fax before any more information is exchanged.
6. Post your business on some business for sale web sites.
7. Have the last three years tax returns that reflect the company's performance available. Create an Executive Summary for potential buyers. A sample Table of Contents is below:
§ OVERVIEW
§ STOCKHOLDERS' MOTIVATIONS
§ GROWTH HIGHLIGHTS
§ BUSINESS SUMMARY
§ MANAGEMENT ORGANIZATION
§ KEY EMPLOYEES
§ CRITICAL COMPANY MILESTONES
§ FAQ's AND ADDITIONAL DETAILS
§ EBITDA ANALYSIS (000's)
§ MARKET BALANCE SHEET
8. After Confidentiality Agreements are executed and you have provided the Executive Summary or whatever information the buyer has requested, you should arrange a buyer visit to further explore the acquisition potential.
9. If they are interested push for a Qualified Letter of Intent (LOI) or Term Sheet. This basically lays out the transaction economics prior to due diligence. The basic concept is that if I (the buyer) can validate what you have told me about your business and find no negative surprises, these are the terms of my purchase offer. It is a non-binding letter and is used to move the process forward. The buyer w
In many parts of the world, people still band together in primitive tribes. They work in unison and do whatever is necessary to survive. Life is harsh. When they make mistakes, they die. We are lucky in that for our modern tribes or companies the consequence of failure is rarely death. Of all similarities between tribes, primitive and modern, it is the ability to maintain battle readiness during times of prosperity that is most critical.When the living is easy, the opportunities to work in harmony under stress are infrequent. Teamwork skills soften. There is v
6. Post your business on some business for sale web sites.
7. Have the last three years tax returns that reflect the company's performance available. Create an Executive Summary for potential buyers. A sample Table of Contents is below:
§ OVERVIEW
§ STOCKHOLDERS' MOTIVATIONS
§ GROWTH HIGHLIGHTS
§ BUSINESS SUMMARY
§ MANAGEMENT ORGANIZATION
§ KEY EMPLOYEES
§ CRITICAL COMPANY MILESTONES
§ FAQ's AND ADDITIONAL DETAILS
§ EBITDA ANALYSIS (000's)
§ MARKET BALANCE SHEET
8. After Confidentiality Agreements are executed and you have provided the Executive Summary or whatever information the buyer has requested, you should arrange a buyer visit to further explore the acquisition potential.
9. If they are interested push for a Qualified Letter of Intent (LOI) or Term Sheet. This basically lays out the transaction economics prior to due diligence. The basic concept is that if I (the buyer) can validate what you have told me about your business and find no negative surprises, these are the terms of my purchase offer. It is a non-binding letter and is used to move the process forward. The buyer w
Have you ever found a lead on a scrap of paper after the prospect purchased from your competition? Are you spending time recreating proposals because you can’t find a similar one you wrote a few months ago? Do you run out of the door for an appointment at the last minute because you couldn’t find the brochures you really wanted to take? Are you feeling overwhelmed? If so, here are six simple steps to help you increase sales and decrease stress:1. Make a date with yourself for getting your act together. Plan a minimum of three hours when there will be no i
8. After Confidentiality Agreements are executed and you have provided the Executive Summary or whatever information the buyer has requested, you should arrange a buyer visit to further explore the acquisition potential.
9. If they are interested push for a Qualified Letter of Intent (LOI) or Term Sheet. This basically lays out the transaction economics prior to due diligence. The basic concept is that if I (the buyer) can validate what you have told me about your business and find no negative surprises, these are the terms of my purchase offer. It is a non-binding letter and is used to move the process forward. The buyer will normally ask you to stop talking with other buyers if you accept his LOI. He wants to know that if he is going to invest his resources in due diligence, you are not going to shop his number to other buyers.
10. Try to limit the period of due diligence to no more than 45 days. If the buyer finds unexpected issues, they will usually try to adjust their offer downward. It is just part of the process. Just make sure you reveal any warts before he finds them in due diligence.
11. Once that is completed, the buyer's attorney will draw up Definitive Purchase Agreements and submit them to you. Do not attempt to complete this process without an attorney. You need their help to make sure you understand the contracts and to make sure you are reasonably protected. Do not, I repeat, do not attempt to renegotiate the economics of the deal at this point. It will blow up. You are only dealing with legal issues at this point.
12. Cash Your Check (do not be surprised if you are asked to carry some portion of the purchase price as a seller note). Over half of all business sales involve some form of seller financing. The smaller the company, the higher the percentage. Go to your island and drink your umbrella drinks. Good Luck.
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