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The Elements of Valuation

Accurately valuing a small business can be challenging for prospective business buyers, but it is an important part of the selling process that encompasses many factors. Cash Flow – In real estate, a buyer’s main focus is location. In business acquisitions, it is cash flow.  Small businesses are often priced using a multiple of cash…

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The Best Time to Sell

Deciding to sell your business is a big deal. In fact, it’s likely to be the biggest financial transaction in a small business owner’s life. Many business owners operate under the assumption that they will operate their business until retirement, but things can change.  Too often these changes come via unforeseen circumstances such as illness…

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Training Employees on a Tight Budget

Lack of training can result in business inefficiencies.  It can lead to employees who aren’t motivated to improve.  It can also result in the departure of employees who do want to improve.  Lack of training and opportunity are key reasons that employees leave a company. Too many small business owners don’t consider the costs of…

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Who are the Buyers?

You will have a head start in selling your business if you can identify the most likely type of buyer in advance.  By answering a few questions, a seller will be able to forecast the buyer’s probable financing needs and priorities. Questions include: Will the buyer have industry experience? Will he be a first time…

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What is Your Business Worth?

Prospective buyers make the decision to purchase a business based on future upside potential, but they establish the price they’re willing to pay for the business based on its past and current performance. When you are ready to begin the valuation process, a business broker or a business valuation service can help you determine its…

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What Do You Want to Achieve? Negotiating the Sale of Your Business

Every business acquisition will involve some form of negotiations before the process is done. The negotiating phase can be difficult and the final result may be radically different from the original deal.  If a business owner is not prepared to properly negotiate, he could lose a deal, or settle for a lesser deal, and not…

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Should You Consider Taking Over an Existing Business?

So you want to be an entrepreneur, but don’t have an idea you want to pursue? Then you may be a great candidate to buy an existing business.  Buying an existing business may involve more cost upfront, but it also represents less risk than starting from scratch. One advantage is that, once you are a…

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Deciding When to Sell: Timing is Everything

 A business owner can spend his entire career developing a business. It’s his baby, which can make selling it the most difficult decision he will make. The timing and reason for selling must be right.  But how do you know what those are?  Here are some factors to think about: Burnout If you have lost…

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Showing Your Business: First Impressions are Important

Showing a business is more than just touring a prospective buyer through the building and showing him four walls and a new paint job. It’s about perception.   External Business Appearance Most business showings are performed after business hours due to confidentiality. The buyer should understand that employees may not be aware of a possible…

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Murphy’s Law: 5 Pitfalls to Avoid

Murphy’s Law is an old adage that says Anything that can go wrong, will go wrong.  Murphy is bound to strike at some point, however, the following common mistakes that can be avoided. Comparing Sales Prices Don’t compare what another business sold for to your business.  There are just too many variables and too many…

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