Before You Sell There are a handful of elements that are fundamental to positioning a company for a sale. It is well worth a business owner’s time upfront to understand these elements. – Don’t force an owner-operator situation by making yourself irreplaceable or indispensable. It narrows the pool of buyers tremendously. – Don’t borrow a bunch of money – especially right before you sell. Over-leveraging is a real problem and will reduce the amount of cash a seller walks away with at closing. Your debt ratio will be examined closely. The potential buyer must calculate enough cash flow to satisfy debt service and their desired investment income. – Don’t tell your employees. I know this sounds counter-intuitive but it can cause unnecessary strain on the employees and business as a whole. Numerous transactions have been sidelined by key employees. – Do make sure your books are up to date. If you wait until the end of the year to do your bookkeeping, your business broker will not be able to complete the in-depth financial review, analysis, and repacking that is required. – Do have conversations with partners and family members that the sale may affect. Share your intentions and plans […]
Quick Calder Q&A with Advisor Shane Kissack
Why did you become a business broker? Ten years ago I was building my own small businesses – several of them – simultaneously. The work I did expanding those enterprises culminated in positive exit experiences when I sold two of the businesses a few years later. Although I used a business broker for one of the transactions, I discovered that my background and knowledge were accretive to managing the process myself with the buyer and our respective attorneys for the second sale. Following the sales of my businesses, I remained in an advisory role to the new ownership developing business plans, growth plans, budgets, succession plans, and even exit plans. From there I was enlisted to lend my skills to an economic development enterprise, managing real estate development projects and guiding developers and companies through incentive programs in conjunction with local government and state partners. Tasked with attraction, retention, and expansion of these businesses, I developed a keen understanding of the unique challenges and opportunities that growth affords. What has resulted, is a career in business brokerage – the intersection of my acumen for business strategy and my personal experience. What kinds of businesses do you like to work with? […]
Business Brokerage Specialization? It’s Different Than You Think!
You may be surprised to discover that, for us, business brokerage is largely industry-agnostic. Within the mergers and acquisitions (M&A) industry, we have encountered firms and brokers who focus their expertise in a specific niche, be it restaurants or healthcare-related businesses or otherwise. While these preferences serve their own strategic business goals, we find this mindset does not apply to Calder’s business brokerage services. Because our approach is technology-driven, we are able to transcend industry silos to ensure the broadest exposure to thousands of qualified buyers for each business we represent. We have found that there are other significant characteristics, however, of business ownership that are the key drivers in establishing a relationship and executing a transaction. OWNERSHIP. Independent and family-owned businesses are important to their respective industries, facing similar challenges and opportunities regardless of their industry. Understanding the nuances of private ownership and structuring transactions to ensure specific owner needs are met is crucial. RAPPORT. Entering into a transparent, trusting relationship is not something to be taken lightly. Interactions should be positive and professional, communicative, and understanding. The selection of a business broker is a highly relational component to a business sale’s success. THE OTHER SIDE OF THE DEAL. […]