Sunbelt Business Brokers of Baton Rouge

Putting together the buyers and sellers of privately owned businesses. Tweeting acquisition opportunities and market trends.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

An often understated issue with all buyers of businesses....can they psychologically pull the trigger and do a deal. Many have the means or ability, but can they commit to a deal?

Many FSBO businesses allow buyers to linger around past the time to execute.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

Valuing a business is a true skillset and requires industry experience to perfect.

Before you go to market get a proper valuation done from a group or individual that has actually marketed and sold businesses. Not the other way around.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

One of the biggest mistakes business owner make when looking to sell their business themselves is never getting a proper NDA signed before engaging in discussions with a potential buyer.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

Scalability - Have you proven it yet?

Is that a second location or third that is functioning and profitable? Or is it just a belief but never capitalized on.

If you have time to prove it, do it. The growth that brings will be proven, validated and applied to your multiple.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

Potential and Scalability are two different realities.

Buyers pay premiums for what they can see and is proven.

Claiming your company has potential or scalability without proof will not work.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

Non-Competes and employment agreements prize a lot of sellers when it's time to sell. 

Going to sell is also preparing for life after ownership. Knowing what you want to do, if you want to stay on or use the same skills you had to build the business in the future, is key.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

Is your business truly scalable and has potential to grow?

Claiming so just because you have a certain EBITDA number is flat out wrong. Companies with strong numbers still can receive lower multiples because they are not set up to be scalable or lack potential to keep growing.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

Elite Tip for Business Buyers:

If a business owner tells you their business is truly scalable and has" great potential" then ask for those answers .

Have that owner lay out in detail to you exactly what they would do, why they haven't done it yet.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

What guard against unintentional inaccuracies or deal fatigue when it comes time to finalize the closing documents. 

This is especially true in the reps and warranties section. 

Get it right. Take your time, and be fully sure you know what you're signing.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

If you've been a part of a business sale you know UCC's an be a hiccup at close.

Before you go to market a great pre-sale item to circle is having a UCC check on your equipment.

You may be surprised how many were paid off, not formally cleaned up that are lingering.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

Full disclosure if the single most important action you can take as a seller.

This is especially true when to sign the reps and warranties section of your purchase agreement documents.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

What truly makes a business trade at a higher multiple? 

Good financials, the right industry, and history of continuous growth are important. 

But the number one factor that truly expands the multiple and the value of a business is key key management.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

When your company is on top, revenue is great, profitability is at an all-time high; that's the time to sell. 

I often hear, "I'm not ready" or "I have several more years to go." That's fine, but this is when you need to take strategic action.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

Doing the proper homework before taking your business to market is so crucial. 

When you identify risk, key elements, and products or services systems to improve, you've created value.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

The runway available to prepare your business for sale can change the real value and outcome when you decide sell your business.

Taking advantage of the time before it's time to sell is crucial.

Get the process started 2-3 years in advance. Identify key issues and fix them.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

Owner who net the most amount at close don't fret over fees.

They focused on building great businesses and maximizing value.

They built businesses that buyers found desirable and were easily transferable.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

Do you want a "yes man" representing your company?

Do you expect that person to get the best value for your business? The answer is no.

Being a great advisor often means having to be strong in your position and offer the right advice even in the face of the backlash.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

Under reporting income is common in main street service businesses. That's well known.

What is not talked about enough is under reporting employee pay and paying employees cash only.

If you plan to sell your business you can not do this. Nothing else needs to be said.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

Why do we stress the questions, information and particulars needed to value a business?

Sometimes it does seem like a lot. Even over kill. We get it.

We ask because when it's time for that first discussion call or information packet to be sent over to the buyer, it matters.

[Sunbelt Business Brokers of Baton Rouge @SunbeltLA]

Everyone knows time kills deals.

In reality? The first presentation is what will truly kill your deal and prospecting chances.

Don't fight an uphill battle. Get started today and prepare your business to sell properly.