Sell a Business

Large majority of small business owners are completely unprepared to sell a business

A recent article in Globe & Mail details the fact that the majority of small business owners who are ready to sell their businesses in 2019 are completely unprepared to do so. With SO many other business owners out there planning to close up shop and sell their businesses for a nice exit in a baby-boomer filled market, the statistics are mind-boggling considering we’re talking about the transaction of a lifetime, -literally. The author, Matthew Halliday states:

“Between 2012 and 2018, the number of businesses who just planned to close outright, rather than sell, tripled, from five per cent to 15 per cent,” says Corinne Pohlmann, senior vice-president of national affairs at CFIB. “What worries us is that they’re not finding buyers, and then their only option may be to shut down.”

Additionally, most entrepreneurs tend to put their businesses on the market long before they are ready – for example, without first bolstering lacklustre financial statements or securing relationships with long-time clients in writing. Few have formal succession plans, Ms. Pohlmann says, and many also tend to let their revenue slip in the years before a sale.

So, in that field of under-prepared businesses, it can be easier to stand out if an entrepreneur has the patience to proceed with the months – or years – of preparation needed beforehand.

The article emphasizes the importance building the right team FAR in advance of the moment you’re actually hoping to sell. Preparation is key here…. If you do your research in advance, and start identifying buyers early on in the process, you stand a MUCH better chance of being able to play multiple bids against each other when the time comes to sell.

Takeaway lesson? Put together your business exit dream team early on in the process, and let them keep the ball rolling and keep you from getting distracted with day-to-day operations of your business.

To get matched with intermediaries that fit your geography, business, deal size and more, head over to BizNexus and get your top three suggested intermediaries today, for free.

Head-Scratcher of the day: -67% of business owners do NO planning before putting their business on the market....

How not to sell a business in 2019

It’s an M&A industry FAIL. The fact that the majority of small business owners, founders and solopreneurs out there have little to no awareness of the options for selling their business on the market is egregious, considering where this market is, and has been for sellers for some time (spoiler-alert: market is at an all-time high in terms of valuations and favorable deal-terms for sellers).

In their Q3 2018 Executive Report the IBBA states:

Few sellers are taking the time to prepare themselves for the M&A process. According to advisors, 67% of sellers did no advance planning before putting their business on the market. Nearly a quarter (23%) did less than a year of planning.

Meanwhile, retirement continues to lead as the number one reason to sell across all sectors, followed by burnout and new opportunities. And, year-over-year, time to close has increased in most sectors.

Sellers Don't Plan for a Sale.PNG

One option worth checking out? Find a business broker or related professional and figure out what you’ve got….

A consultation with a business broker, business intermediary or valuation specialist is typically free, and it’s a good relationship to start up early. If you’re an entrepreneur and you’re wondering what your business might be worth, who the buyers might be or whether it’s even sellable, -why not have a conversation? You can ask a friend, of a friend, of a friend if they have somebody the know who you can speak with, you can ask your accountant (which could be a great option if you have a trusted, established relationship), you can search online databases like the IBBA (non-profit) or BizBuySell (for-profit), or you can get matched with a professional in your industry, anticipated deal-size and geographic area with BizNexus. Either way, -probably a good idea to speak with some professionals and get your ducks in a row when you’re talking about selling the biggest asset you have, and possible the most significant financial transaction you’ll ever be a part of.

Top 7 Reasons Why 3 out of 4 Businesses Won’t Ever Be Sold

Top 7 Reasons Why 3 out of 4 Businesses Won’t Ever Be Sold

Wondering if you’ll ever be able to sell your business? Here are the top 7 reasons why 75% of businesses never even get sold……

Learn what it takes to sell your business, who the players involved in the process are, and why so many businesses out there simply just don’t ever sell…. -Which we think is tragic considering the untapped market of buyers out there researching entrepreneurship. Let us know what you think in the comments!

Selling Your Company Starts Today

Selling Your Company Starts Today

Choosing to sell a company can easily be one of the most important decisions a business owner will ever make in their life. That is why it is important to be very prepared to sell your business in order to sell it at the price that it is agreeable to you, the seller. However, preparation starts years in advance. Here are 7 steps to take to ensure your business is ready for sale:

The Art & Science of Selling Your Painting Business

The Art & Science of Selling Your Painting Business

Maybe it was a passing mention that someone was interested in buying your company. Perhaps health concerns have you thinking of an exit. Or is it a nagging feeling that you’re just done? Whatever the reason, if you’re thinking of selling your painting business, know that it’s a journey that’s not for the fainthearted.

About 80% of businesses listed for sale don’t sell, says Peter Holton, managing director with Chicago-based Caber Hill Advisors. Holton oversees Caber Hill’s construction, painting, landscaping, and facilities management division, offering valuation and business consulting insights for those looking to buy or sell service organizations.

“Unrealistic expectations of the business owner are the main reason only 20% of businesses actually sell,” he said. Few business owners truly comprehend the reality check they’ll endure when selling their company. But with a willingness to listen, learn, and correct some deficiencies, it is possible for an owner to make a profitable exit.

From $15 In His Pocket To A $3.2M Exit

From $15 In His Pocket To A $3.2M Exit

In 1961, Kamal Yadav arrived in the United States with $15 in his pocket.  He started Chemco Industries in 1975 and grew the business to $3M in revenue. Chemco sells environmentally-friendly cleaning chemicals, and Kamal’s customers included Walmart, eBay, Amazon, and the federal government.

When his children didn’t express interest in taking over the business, Kamal decided to sell.  He hired Certified Value Builder™ Steve Denny of Innovative Business Advisors to help, and they quickly received 14 offers.

Yadav sold Chemco for $3.2M cash upon closing.