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Determining the selling price is critical to selling your business. Our experienced Florida business brokers know that pricing a business too high or too low can have a detrimental effect on the sale of the business. It is important to price the business correctly from the start. The final selling price of a business is ultimately decided by the market. However, a respectable Florida business broker such as Boss Group International can provide you with an objective and fair market valuation of your business in a price range that will sell. Boss Group International has the capability and experience to perform a fair market valuation for almost any type of business. We do this at no charge and without obligation to use our services.
One of the most important aspects of selling a business is keeping the sale confidential. All front-end and back-end marketing will be done in such a way that your employees, vendors, suppliers and competition will be unaware that your business is for sale. Our diligent Florida business brokers put much effort into pre-screening prospective buyers in terms of financial capability, experience and motivation. Following this process, prospective buyers are required to sign a confidentiality agreement before specific information about the business is disclosed.
Boss Group estimates that 19 out of 20 buyers are either not serious or not qualified, and national statistics indicate that only 20% of all businesses for sale actually sell. Consequently we feel that it is imperative that a knowledgeable professional guide you through the process. Historically, we at Boss Group, with our unique company structure and strategies, have been able to obtain better terms and a better price than our competitors, saving both time and money. In spite of grim national statistics, we feel confident that we can sell almost any business.
Boss Group International will be compensated only when your business sells. If for some reason we don’t possess the talent, skill, experience, or connections to sell your business within the agreed upon time frame, we will not get compensated. National statistics demonstrate that only 20% of all businesses for sale in the United States actually sell each year. This is a very low number. However, don’t be discouraged. Boss Group International can more than likely sell your business if you follow our recommendations and our strategies.
Many deals fall apart because of poor planning. From the beginning, prior to presenting your business to prospective buyers, you and your Boss Group agent will discuss and strategize the sale of your business in order to successfully transfer it.
It typically takes six months to a year to sell a business. Larger businesses may take longer. However, If you need to sell your business faster, we can position your business with special price and terms that will shorten the time frame.
Although national statistics show that only 20% of all businesses for sale in the United States actually sell, Boss Group International can probably sell your business if you follow our strategies and recommendations. It is imperative that you be an active participant in the process, and work closely with your Boss Group Agent. You can also:
- Follow the pricing and offering terms recommended by your Boss Group Agent
- Follow the strategies your Boss group Agent outlines
- Keep the overall appearance of your business neat, clean, and organized (paint etc. if needed)
- Replace or repair broken furniture, fixtures and equipment
- Organize your financials and have suggested paperwork ready for prospective buyers
- Understand the entire business sales process upfront
- Disclose to your Boss Agent and prospective buyers the pros and cons of your business
- Continue running your business to the best of your ability until the day ownership is transferred
Most buyers look for a sustainable business that has a customer/client base with a cash flow that they can build upon to grow the business. One of the major considerations, as might be expected, is whether the present owner can prove that the business is actually making the sales the seller claims. Buyers look for businesses that are priced comparably. They typically look at several, and consequently are aware of overpricing. Businesses that tend to fare the best on the market and can command prices at the high end of the range for comparable businesses are those that have been operating for at least 7 years, have a favorable long term lease, and are doing better in the current year than in the previous one, and whose owner works a maximum of 45 hours per week , files an accurate tax return, and offers seller’s financing. While considering all of these things, your Boss Group Agent will work with you to position your business in a manner that will be most appealing to potential buyers.
A seller’s natural instinct is to ask for an all-cash deal from a buyer. However, it is often detrimental to do so. Buyers tend to feel that a seller’s willingness to finance a portion of the sales price demonstrates a seller’s confidence that the business will continue to perform at the same level or better. It also allows buyers who may not otherwise be able to afford purchasing a business to be able to go ahead and pursue the opportunity. In addition, when the seller is willing to provide 20% or more of the asking price as owner financing, buyers usually show more initial interest, often generating a higher sales price. In short, carrying an owner’s note is an important part of setting both price and terms of sale, and could make the difference between selling your business for a top price and not being able to sell it at all. Your Boss Group business broker will advise you as to what you should offer in terms of seller financing, according to your industry, sales price and the length of time in business. When owner financing is involved, Boss Group business brokers will do a UCC-1 filing with the State of Florida. This places a lien on both the assets and the business to help ensure that the seller’s financing is paid in full. You may want to consult with your CPA since there could also be very favorable tax benefits to you for carrying an owner’s note.
Here are several other financing options available to buyers, including conventional and Small Business Administration loans. Sometimes, however, lenders require that seller’s financing be part of the transaction. Boss Group business brokers work with buyers to explore various options.
If you are not reporting all your income for tax purposes, we highly recommended that you start doing so immediately. Because a prospective buyer will want you to prove that your business is doing what you state, unreported income can prove to be very detrimental. It will reduce the amount you will receive for your business, which will undoubtedly take longer to sell, and greatly limit financing options. It will also greatly increase the chance that you may not be able to sell at all.
Florida business brokers can help maintain the confidentiality of the sale, suggest suitable price and terms, handle the marketing/advertising, pre-screen buyers, help in the negotiation of the contract, guide the transaction to closing and help ensure an easier transition of the business. Boss Group International can provide effective marketing, experience, knowledge, support, and strategies that can make the successful sale of your business a reality. Business brokers are not magicians however. They cannot sell an overpriced business or one with terms unfavorable to the buyer.
Sometimes the seller’s lease is assigned to the buyer with the landlord’s approval and sometimes the seller is released from the lease, with a new one being executed at the time of closing. Occasionally a seller needs to remain on the lease as a guarantor. The terms of your lease will probably state what will be required in the event that you sell your business. After a purchase contract has been executed, Boss Group will work closely with your landlord/property management company concerning the transfer of the lease.
You have several options if you own the real estate that your business is in. First, you have the option to sell both the real estate and business to the buyer, sometimes beneficial to the buyer in terms of bank financing. Secondly, you can sell only your business, and then lease the premises to the new owner. In addition, there are several hybrid options. Your Boss Group business broker can discuss this with you.
Typically the asking price of the sale of a Florida business includes all the furniture, fixtures, equipment, inventory, and goodwill. All loans are paid off at the time of closing so that the assets are conveyed to a buyer free and clear. Money in bank accounts, deposits and the accounts payable are usually not included in the asking price. Accounts receivables are usually not included, although in some circumstances this might be necessary in order to meet the criteria of a financier.
Many small business owners decide not to utilize the services of an attorney or CPA. However, Boss Group suggests that you do work with your attorney and CPA to ensure that the transaction is as you understand it.
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