The Top Three Major Legal Mistakes to Avoid During a Sale

The business deal process can be perplexing, or, in other words the motivation behind why it bodes well to have a professional business broker help selling a business. Lawful oversights can be exorbitant errors when selling a business. A legal mix-up can likewise convey the whole deal procedure to a sudden and complete end. How about we investigate what you can do to maintain a strategic distance from these sorts of issues when selling your business.   Major Mistake 1 – You Skipped the Non-Disclosure Agreement Nothing welcomes inconvenience like avoiding the non-disclosure agreement when working with a professional business broker. In the event that an arrangement fails to work out, at that point you have the NDA backing you up. This document guarantees that the prospective purchaser doesn't tell the world that you’re selling your business. Never expect that an arrangement will complete until the point when it really is 100% finished. Purchasing or selling a business is … [Read more...]

What Should Be in Your Partnership Agreement

One essential business document is a partnership agreement which the importance can be difficult to overemphasize. It is crucial to have a written partnership agreement whether your partner is either a stranger or a lifetime friend when buying a business. A well-written outline of all rights and responsibilities in the partnership agreement functions as an essential tool for dealing with any disagreements, fights, and various unforeseen issues. You will be able to identify and dispose of a wide range of potential dilemmas or issues before the start of the business with the proper documentation that can be discussed with a business broker. Determining the Share of Profits, Regular Draw, Contributing Cash and More Written within the partnership agreement, there should be an outline of each individual partner’s share of profits. Additionally, a partnership agreement should address whether or not each partner gets a regular draw. As this area is where conflicts occurs the most, … [Read more...]

Can I Buy Businesses With No Collateral

Initially, the idea of buying a business without any collateral seems impossible, but it can be realistically done with a business broker. Let’s examine your options. When achieving this goal, being open minded and having commitment to hang in there despite the odds is your greatest asset. The Small Business Association’s 7 (a) Program is Your Friend One route towards buying a business with zero collateral is opt for the SBA’s 7 (a) program that works gives the bank a incentive to make a loan to a prospective Buyer. Under this program, the SBA guarantees 75%. The Buyer will still have to put in 25%; however, the 25% doesn’t have to truly be his or her money. That’s where things get interesting. The 25% that the Buyer provides can come from either parents of an individual that was gifted cash in cases of young buyers or from an investor. Both these possibilities fall within the SBA’s guidelines which you can discuss with your business broker. Look into Seller Financing, You … [Read more...]

Should You Become a Business Owner?

There’s no denying that buying a business has great rewards, but being a business owner may in the end not be for everyone. Should you buy a business on your own? Take some time and outline the various benefits of owning a business and letting a business broker help you decide whether or not this path is correct for you. Do You Want More Control? One leading reason that many business savvy individuals opt for buying a business is that is offers high level of control. Especially, business owners are in control of their own decisions. Buying a business or franchise may be suited for you if you’ve ever wished for more control over your life and decisions. By buying a business, this will allow you to chart your own direction. Once the business is successful, you can hire employees to reduce personal workload and in the process should free up time to spend doing whatever you want. You will never achieve the free time to do whatever you desire while working for someone else; after … [Read more...]

Three Overlooked Areas to Investigate Before Buying

Before you buy a business, you’ll want to do your due diligence. There’s no time to make assumptions or simply wing it when buying a business. Consequences of not doing a careful investigation of any business could be extremely dire. Below is a quick look at the top three overlooked areas to investigate before signing on the dotted line and buying a business. Retirement Plans Majority of Buyers forget all about retirement plans when looking into a business prior to buying the business. Failure to examine certain regulations that has been put into place will spell out a huge disaster. For that reason alone, you’ll want to genuinely make sure that the business’s qualified and non-qualified retirement planes are up-to-date at the Department of Labor. While there can be various unexpected circumstances that arise when buying a business, this is the one you want to avoid. 1099’s and W-2’s Many prospective Buyers often fail to investigate the retirement plan of a business, … [Read more...]

5 Tips for Buyers of International Businesses

The decision to buy an international business is no doubt quite serious. There are numerous factors that must be taken into consideration when deciding whether or not an international business purchase is the right move. Let's take a closer look. Tip #1 – Relocating Vs. Hiring a Manager Buying an international business can also mean a substantial life change. Before jumping into the process, it is critical that you know whether you will be relocating or hiring a manager to run your newly acquired business. Obviously, owning a business is a substantial responsibility and you'll want to ensure that you know exactly what is going on with your new acquisition. Sometimes that means actually being there. The bottom line is that you will either have to relocate or hire a manager. Tip #2 – Regulations Understanding regulations, taxes and customs are another must for buyers of international businesses. A failure to factor in these elements can literally undo one's business or at … [Read more...]

5 Reasons Buying a Business is Preferable to Starting a New One

If you are considering running your own business, one of the first questions that might pop in your mind is: should I start a new one or buy an established business. In this article, we'll take a closer look at the age-old dilemma of buying an existing business verses starting a new one from scratch. 1. An Established Concept The benefits of buying an established business are no doubt huge. At the top of the list is that an existing business will have an established concept. Starting a business from scratch means taking a big risk in the form of a new idea. Will it really work? If the business fails, why did it fail? Both of these stressful questions need not be asked when you buy. An established business, especially one that has been around for years, has already shown that the concept and all the variables that go into it do, in fact, work. 2. Proven Cash Flow Another massive benefit of buying an existing business is that an existing business has proven cash flow. You can … [Read more...]

Considerations When Selling…Or Buying

Important questions to ask when looking at a business…or preparing to have your business looked at by prospective buyers. • What's for sale? What's not for sale? Does it include real estate? Are some of the machines leased instead of owned? • What assets are not earning money? Perhaps these assets should be sold off. • What is proprietary? Formulations, patents, software, etc.? • What is their competitive advantage? A certain niche, superior marketing or better manufacturing. • What is the barrier of entry? Capital, low labor, tight relationships. • What about employment agreements/non-competes? Has the seller failed to secure these agreements from key employees? • How does one grow the business? Maybe it can't be grown. • How much working capital does one need to run the business? • What is the depth of management and how dependent is the business on the owner/manager? • How is the financial reporting undertaken and recorded and how does management adjust … [Read more...]

Do You Have an Exit Plan?

"Exit strategies may enable you to get out before the bottom falls out of your industry. Very much arranged ways out enable you to show signs of improvement cost for your business." From: Selling Your Business by Russ Robb, distributed by Adams Media Corporation   Regardless of whether you intend to sell your business in a year, five years, or never, you require a leave system. As the term recommends, a leave system is an arrangement for leaving your business, and each business ought to have one, if not two. The first is valuable as a manual for a smooth exit from your business. The second is for crises that could come to fruition because of weakness or association issues. You may never plan to sell the business or work with a professional business broker, yet you never know! The initial phase in making a leave design is to create what is fundamentally a leave approach and methodology manual. It might wind up being just on a couple of sheets of paper; however it should … [Read more...]

A Buyer’s Quandary

It’s revealed statistically that only one out of 15 would-be business buyers will go forward with buying a business. Potential sellers should be knowledgeable on what buyers go through to become actual business owner of a business which is extremely imperative information for each seller which a business broker can provide. This is particularly true for individuals who started their own business or forgotten what went prior to the process of buying their business from a business broker. If a prospective business buyer is employed, that buyer has to be affirm with the decision to leave that job and operate the business for/by oneself. Also includes the financial commitment that is necessary to truly invest in a business and any subsequent loans that is a direct result of buying a business. It is likely that the new owner will need to execute a new lease or assume the existing lease, which is categorized as another financial responsibility. The new owner almost always guarantee … [Read more...]