The health food industry is a 26 billion dollar business and continues to increase yearly with greater demand. According to the Organic Trade Association, U.S. sales of organic food and beverages have grown from $1 billion in 1990 to $26.7 billion in 2010. More Americans are concerned about eating healthier, you can help people achieve their ultimate health through this health food store.

The gross sales that the former owner reported to the IRS were as follows: 2008 ($927,709); 2009 – ($887,737); 2010 ($810,392). For a $225,000 investment you receive a guaranteed $100,000 of inventory at cost. You are buying the business for just $125,000.

You can use $200,000 from your retirement funds to earn $150,000+ year. Any profits left after paying yourself are non-taxable. You can invest them any way you want within the retirement plan.

The current owners are the original owners from 30 years ago.

If you pay all cash, you can buy the business plus inventory for just $200,000.

About the Business

• Year Established: 1980
• Number of Employees: varies
• Facilities: 3,000 sq. ft. of which 2,000 is retail, 400 are 2 offices and the balance is service, bathroom and storage. Lease is triple net at $7,000/mo. The only add ons are increases in maintenance, insurance and property taxes. There are 2 sub-tenants paying a total of $2,375/mo. So net rent is only $4,625 in prime location. Term can be 3 years with a 3 year option. Initial rent does not escalate for 3 years.
• Market Outlook and Competition: There are tremendous opportunities that the owners will share with the right buyer. While there is significant competition, the owners have said that if the store is run properly, a new owner can net $150,000+.

About the Sale

• Management Training and Support: Sellers will give 2 weeks assistance included in the sale. If more help is desired, this will be negotiated between new owner and sellers.
• Reason For Selling: Family needs in other states.
• Seller Financing: $150,000 down with $75,000 @ 6% over 36 months

Financial Details

• Asking Price: $200,000
• Inventory: $100,000 ++
• Gross Revenue: Not Disclosed
• Real Estate: n/a **
• Cash Flow: Not Disclosed
• FF&E: $50,000 ++

++ included in the asking price ** not included in the asking price

Don’t let this great business opportunity get away. Contact Bottom Line Management, Inc. today for buying details!

Broker Contact Information

Contact: Loren Marc Schmerler
Phone: 404-550-1417
Email: LMS@BOTLINE.COM

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Create a new life – be your own boss. Buy the business of your dreams.

Bottom Line Management, Inc. is here to help you identify business opportunities that meets your personal, professional, and financial goals. Business ownership can offer you financial rewards and a great deal of personal satisfaction. Preparation is a key factor in buying a business. Motivated buyers should weigh their options carefully before selecting a business to purchase.

Consider the following factors as you are deciding what kind of business to buy.

• What do you enjoy doing the most? Are you technically skilled in this area?
• What are your strengths and weaknesses?
• Are you motivated to do whatever it takes to make your business successful?
• Do you have the interpersonal skills to work well with clients and employees?
• Do you have a business plan with achievable goals?

Working with Bottom Line Management, Inc. will:

Save you time
If you are an entrepreneurial individual looking to capitalize on your dreams, we can help you select a business where you can use your current skills to discover satisfaction and success. If you own a growing business that is seeking an effective growth strategy, we can manage a well-executed acquisition where you can take advantage of synergies between your current business and the integration of a newly acquired business.

Save you money
Bottom Line Management, Inc. will mediate and negotiate the best price to buy your dream business.

Ensure buying process is seamless
Bottom Line Management will work with you from contract to closing to ensure that all the necessary paperwork is in order and that the business has seamlessly transitioned to you.

Bottom Line Management will work with you to determine how your strengths and interests will align successfully with businesses that are available in the marketplace. Contact us today to become your Own Boss.

Recently, a female friend of mine relayed an experience she had with a hair salon that inspired me to write this article. Over the last 25 years, I have been asked to list and sell numerous hair salons. Some of these salons operated off the “chair rental” model where each stylist paid a weekly or monthly amount for use of a work station throughout the week or month. In this scenario, the stylist is responsible for his or her total expenses. Each stylist is an independent contractor, and they are responsible for their own taxes, benefits, continuing education, etc. Scheduling can be flexible, but there are no paid holidays or vacation days. Most importantly, there is no cross training between stylists to handle another stylist’s customers or to perform other spa related services like facials, manicures, pedicures, etc.

The second popular and more common business model is the “commission” model where the stylist receives a percentage and the owner receives a percentage. Frequently, the split is 60% to the owner and 40% to the stylist. But for more experienced stylists, the split can be 50/50 or sometimes even more to the stylist and less to the owner if the stylist is a real superstar who has a large clientele and provides color along with cuts. In this model, the stylists are employees. They have payroll taxes withheld and “theoretically” they are supposed to report their tips.

Based on the philosophy of the owner, the stylists are responsible for their own scissors but are provided with other products like color, conditioner, shampoo, etc. The owner will normally pay for continuing education because it makes each stylist more valuable. Stylists may receive vacation days and some insurance benefits. The owner dictates scheduling and permission to take time off must be approved by the owner. If a stylist is sick, the customers scheduled for that day either must reschedule or are passed over to another stylist or stylists who may or may not have an equivalent skill level.

I might add that the turnover rate in the hair salon industry is quite high, particularly if the owner is a tyrant or lacks empathy. Often times, two or three stylists will break away to start their own business. But there is a big difference between being a good hair stylist and being a successful business owner. The most common reason that business owners give for wanting to sell their salons is that they do not like the business and management responsibilities. They tell me that they just want to cut hair and interact with their customers and other employees as equals.

This brings us to the reason I am writing this article. My friend met a very successful salon owner who provided my friend with an unbelievable experience. From the moment she entered the salon, she was treated like royalty. There was an initial consultation (for which there was a fee charged) followed by an explanation of the “team” business model. Every stylist was cross trained to be able to provide shampoos, haircuts, facials, manicures and pedicures. If a stylist was ill or needed to be gone for the day, any of the other stylists could provide the desired services.

My friend was offered a beverage of her choice, and the stylist provided her with a very careful and methodical cut and color. Her bangs were especially important and were cut to perfection. Her color was matched exactly as she wanted. The next stage was a manicure followed by a pedicure. All services were delivered with the greatest of care.

The owner pays for all annual continuing education to keep her team current with all trends. Benefits to the employees include 50% medical/dental/vision insurance, paid vacation, paid holidays, flexible scheduling and bonuses. I am saving the most amazing aspect of this operation for last. No tips are accepted. Yes, you read me right – NO TIPS.

Pam Brinson’s own words follow. “I have been in this business a long time, and hated the competition between employees and also not knowing what I was going to make each week. With this plan, the girls clock in and out. Their hourly depends on their total services and retail sales, but also their commitment to teamwork, and also care of the salon. This has been good for us, because our clients are usually touched by all of the girls during a visit, and learn to trust us all as a team. Times have been hard the last few years; but I trust God to keep us here to take care of our wonderful clients!”

Do you own a business and are you looking to pursue new endeavors or thinking about retiring?

The best time to sell your business is when you don’t have to. With the right exit strategy and proper preparation, the more successful the outcome will likely be.

Our chief mission at Bottom Line Management, Inc. is to sell your business while keeping a razor-sharp focus on helping you to achieve your goals and objectives.

As you begin the process of selling your business, your first step should be to select the right broker.

When working with Bottom Line Management, Inc. you can expect:

• Confidentiality. Unlike a real estate sale, you don’t want to stick a “For Sale” sign in front of your business. We will explore all possible marketing channels and methods, even sound out competitors, while maintaining complete confidentiality.
• Pricing Expertise. Pricing a business can be tricky. If it’s too high, it won’t sell; if it’s too low, you’re leaving money on the table. We help you establish optimum pricing so your business will sell as quickly as possible while netting you the maximum amount.
• Protection. “Tire Kickers” can waste your time, and selling to an unqualified buyer can create a nightmare after the sale. We screen every potential buyer to save you time and protect your confidentiality.
• Focus. In one way, selling a business is like selling a house; you want to show it at its best. When your business is actually on the market, every month should be a banner month. We will let you concentrate on what you do best – running your business.
• Comprehensive Marketing. We develop a broad marketing strategy, which may include media advertising, multiple listing services, and targeted mailings, as well as our internal database of buyers who have indicated an interest in certain types of businesses. In this process, we will always maintain complete confidentiality.
• Value. Because BLM’s principals have extensive experience in small business management consulting, we frequently find innovative ways to increase the value of a business prior to the sale.

Contact Bottom Line Management, Inc. today to start a successful selling process and begin your new venture.

Loren Marc Schmerler CPC, APC, President has been designated an Industry Expert by Business Brokerage Press. Business Brokerage Press supports and equips the business brokerage industry providing valuable resources and information.

Bottom Line Management was founded by Loren Marc Schmerler, a Certified Professional Consultant and Accredited Professional Consultant with more than 25 years experience selling businesses in over 200 industries has a passion for helping business owners understand and maximize their bottom line.

Loren Marc Schmerler CPC, APC has been designated Industry Expert by in the following industries:

• Beer, Wine, and Liquor Stores
• Limousine Service
• Prerecorded Tape, Compact Disc, and Record Stores

About BBP’s Industry Experts Program

From experts in accounting firms to specialists in the wireless industry, each of our industry experts has qualified for our program through their demonstration of an in-depth knowledge of a particular type of business. Their knowledge may have come from owning that type of business, from working in that industry, or through transaction experience with that type of business. Regardless of the source, they have expert knowledge in their prospective industry.

Loren Marc Schmerler, CPC, APC, President and Founder of Atlanta based Bottom Line Management, Inc. recently shared how to apply and obtain a SBA loan for those interested in buying a business during "What You Need to Know When You Are Ready to Sell or Buy a Business or Franchise"  free monthly seminar hosted by The Edge Connection, community partner with Coles College of Business, Kennesaw State University.

Once you have found the business of your dreams, you need to figure out a way to purchase it. One way is if you have the proverbial “rich Uncle” who can write a check for the entire purchase amount. The probability of this happening is less than 1%. Or you can go to your parents, siblings or other relatives. The probability of this happening is less than 5%. Perhaps your friendly banker will make you a conventional loan. The probability of this happening is less than 10%.

How then do you improve your chances of getting the money you will need to buy the business in question? Well, if you are like most first time buyers, you will need a SBA loan to buy the business. And if this is your first time down the SBA path, the process is somewhat overwhelming and time consuming. Also, you need to understand that the SBA does not make loans. They insure loans. The SBA Preferred Lender makes the actual loan.

1. Step one is to obtain the 2 most recent tax returns for the business. So if we are in August of 2011, you will need to obtain the 2010 and 2009 tax returns for the business. The SBA Preferred Lender will apply a formula to a calculated figure called Owner’s Discretionary Cash Flow also known as Seller’s Discretionary Earnings. This figure starts with Net Taxable Income from the Tax Return or Net Income (or loss) from the Income Statement and then certain line items are “added back.” The items that are added back include owner’s compensation and perks, depreciation and amortization because they are non-cash items, one-time non-recurring items, interest because it is different for each owner, etc.
2. When the preceding number is determined, the SBA Preferred Lender will apply a formula where they take the anticipated debt service (principal plus interest) and multiple it by 120 percent. They want to make sure that the business can pay back the loan without going into default. They are less concerned with the borrower’s credit score than they are concerned with the company’s ability to pay its bills.
3. Once the SBA preferred lender knows that the business can pay back the loan, they then start making you jump through additional hoops. You will need to complete a very long application that can run 30 pages in length. You will need to draw up a business plan that includes assumptions and strategies.
4. The SBA preferred lender will require that a 3rd party business valuation is performed. They will also require that you obtain term life insurance for the term of the loan. Most SBA loans for businesses sold without real estate have 10 year maturities. If real estate is included, the term can be more than 20 years or less than 20 years.
5. The loan process can take from 4 to 6 weeks if everything goes smoothly. If complications arise, it can take longer.

The preceding steps constitute a crash course in applying for and obtaining a SBA loan.

To learn more about applying and obtaining a SBA loan or how to buy or sell a business register for Bottom Line Management, Inc.'s free seminar "What You Need to Know When You Are Ready to Sell or Buy a Business or Franchise" >>

Loren Marc Schmerler, CPC, APC is President and Founder of Atlanta based Bottom Line Management, Inc. He has been a business broker since 1986 and a business consultant since 1970. His accomplishments include being the original and only Business Advice Columnist for Wal-Mart’s Sam’s Club.

62 Reasons
Why Sellers of Small & Midsize Businesses Hire Business Transfer Intermediaries
© 2011 Ted J. Leverette (“Partner” On-Call Network LLC) 

This poll was commissioned by the Authorized Business Buyer Advocates ® who are licensed by “Partner” On-Call Network ®.

Poll:  "Why do sellers hire business brokers instead of trying to sell by-owner?"

62 reasons are why sellers of small and midsize businesses hire business transfer intermediaries (i.e., business brokers and advisors who specialize in dealmaking on behalf of sellers), according to our poll, conducted in the USA and Canada (plus a few contributors from around the world).

To view all 62 Reasons Why Business Sellers Hire Brokers click here to view PDF. 

The top reasons are these:

• Brokers know how to sell businesses; most sellers don’t
• Seller doesn’t want to be distracted from running business
• Confidentiality preservation and knowledge of what/when to show buyers
• Access broker’s database of potential buyers and investors
• Maximize price buyers will pay for the business
• Owner does not know how to find buyers
• Prepare owner to sell and prepare business for sale
• Broker understands and can depersonalize negotiations
• Explain and handhold seller throughout selling process
• Owner afraid of trying to sell by-owner 

TIP

Business transfer intermediaries of all types function as go-betweens; they can filter communications so all parties to the pending transaction can focus on the most salient points and realistically negotiate differences of opinion. It is normal for conflicts to arise between sellers and buyers (and their advisors). Sometimes it pertains to personalities; and maybe differing goals or misunderstandings about facts. The best business transfer intermediaries can help people understand the facts and find win-win compromises instead of becoming unnecessarily defensive.

Author: Loren Marc Schmerler, CPC, APC, PresidentBottom Line Management, Inc.
Featured by INC. Magazine

Business Intermediaries Facilitate Business Sales

What Is a Business Broker? What is a business? If you're the owner of a privately held company, it's your livelihood, your brainchild, and your identity. If you're the purchaser, it's buying a job after downsizing, taking a leap of faith that you can be an entrepreneur. For employees, it's a wish for steady income in an uncomplicated market.

When is the best time to sell a business? It's when the business is doing well and you don't have to sell. Unfortunately many owners don't follow that pattern. 

Where does the business broker or intermediary fit into this picture? A business broker is a trained specialist in the field of business transfers, just as an attorney is trained in law and a CPA in accounting and taxes. These are issues that are far more complicated than a real estate transaction.

Owners, who would never think about writing their own contracts or doing their own taxes, often feel that if they have run and grown a successful business, they should be able to handle its sale.

What should buyer and seller expect from an intermediary beyond their introduction? Besides the time consumed in qualifying buyers, there are issues that are obviously emotionally and financially involved.

And an intermediary's experience and knowledge of the whole story of your company – finances, competition, your market – gives him (or her) objectivity to effectively offer your business for sale and know whether a deal will or will not work.

How do you know if your business is fairly priced? The broker may suggest an “Opinion of Value” to determine the fair market value of your business within a specified pricing range. This is the best way to sell the business quickly.

Confidentiality is of course paramount. What about employees? Should they be told? Will key employees stay and if not, how will that affect the sale? Special packages may have to be negotiated for them as part of the offer.

Owner financing always speeds the process. Determine ahead of time reasonable payments the cash flow of the business can support and still leave enough for the buyer to have a return on his investment to live on. You can often get your asking price if the terms are attractive enough.

Give yourself adequate time to plan your sale. Smaller businesses should expect to be on the market a minimum of seven to nine months; middle market ones at least a year or longer. As with most things in life, it's the attention to preparation that leads to the best results. A professional intermediary can help make the difference.

Let us show you what we can do for your bottom line. We are open for business 24/7/365.
Bottom Line Management, Inc.
info@botline.com
(770) 977-7334

Prospective buyers often ask me where they can obtain money for a down payment to purchase a business. There are several answers to this question based on a variety of factors. I will attempt to answer the question as thoroughly as I can below.

Personal Savings

The quickest and easiest way to obtain money is to withdraw it from your personal savings. You may have a passbook account, money market account, Certificate of Deposit, etc. With a CD, you will have an early withdrawal penalty, but that should not discourage you from using these funds to buy a business.

Cash Value of Whole Life Insurance

This is an area that is often overlooked, but if you have a whole life insurance policy that has accumulated a cash value, these funds may be withdrawn as a loan that never has to be repaid. If you die, the outstanding loan is deducted from the face value of the insurance policy proceeds. Whole life is very different than term life insurance, which most people are buying today. With term life insurance, there is no build up in cash value for you to borrow against.

Your Parents

This is an area that is fraught with some degree of danger. While your parents may have the money to loan to you when you first approach them, if the transaction is not handled at arm’s length with a certain degree of business formality, the lines between your parents as a lender and your parents as your immediate family can become blurred. If you do borrow money from your parents, you should sign a promissory note with specific terms of repayment. The rate of interest may be slightly below the current market rate of interest. This is the “family rate” of interest, but it is still interest. In my opinion the note should provide for equal payments of principal and interest on a monthly basis with a specific term for the amount to be repaid in full.

You need to feel committed towards paying your parents back, which many children never succeed in doing. If the business acquisition turns out well and the loan is repaid as mutually agreed upon, there is never an issue. But if the business venture turns sour, and you stop repaying your parents, you can strain the relationship at best or lose the relationship at worst. Additionally, if your parents loaned you funds they needed for retirement, your inability to repay them can result in considerable damage to their financial security.

Your Rich Uncle

This is a “figure of speech” for another family relative other than your parents and your siblings. It can be an Uncle, Aunt, Cousin or Grandparent. Once again, the loan needs to be handled as a formal business transaction as explained above. If you do not repay the loan, there are similar negative consequences. The loss of affection at best or loss of the relationship at worst is the price you will pay. Because each of these individuals is somewhat removed from your immediate family, the damage might be viewed as being less severe.

Your Brother or Sister

With these individuals, you are now very close to home again as you are with your Mother and Father. You need to think very carefully before you approach your siblings, since under normal circumstances their financial resources are less than your parent’s resources. If you do not pay them back, they are likely to be hurt much more than Mom and Dad. But if they do agree to loan you money, the same business formality should apply as explained above.

Your Regular IRA, Roth IRA, SEP-IRA, 401k, etc.

Normally there are restrictions and/or penalties when you use these funds. Based on your age when you withdraw these funds, you may or may not have to pay a steep 10% tax penalty. If your Roth IRA has been open 5 or more years, you will not be penalized since your contributions were “after tax” dollars, and you did not deduct the contribution on your personal tax return. If you are over 55 years of age, your withdrawals from your IRA accounts are not penalized. If you are under 55 years of age, your 401k may loan you limited amounts of money.

Your Friend

The quickest way to lose a friend is to borrow money from them and never pay them back. While you should use the same business formality as explained previously, you need to really evaluate your friendship before you borrow the money. Some friendships are invaluable, and the loss of a friend can be more devastating than the loss of a family relationship. After all, a family member will always be that family member regardless of estrangement, but a friend ceases to be a friend when they no longer regard you as their friend.

Rob a Bank (Disclaimer – this is a joke)

Please understand that I am just kidding. I needed to provide for a little humor in this article. Banks will normally not loan you money for a down payment. They want you to have some “skin” in the game. They may loan you money if they feel the business has the ability to pay the loan back. A lot of people think that if they have excellent credit a bank will make them a loan. That is not what motivates a lender to make a loan. The lender’s belief based on the business’s solid track record of financial performance is what determines whether the banker will make the loan.

Buying an existing business with an established and verifiable history is superior to starting from scratch with no customer base. An existing business could help you obtain bank loans easier than starting a business from scratch.

If you are unsure of what type of business opportunity to purchase or looking for more information on how to buy a business, Bottom Line Management, Inc. provides a FREE Consultation with no obligation to help you get started.

Register for one of Bottom Line Management, Inc.'s Free seminars entitled "What You Need to Know When You Are Ready to Sell or Buy a Business">>

Loren Marc Schmerler, CPC, APC has been a business intermediary for 25 years. He handles Mergers and Acquisitions as well as Main Street transactions. Loren has experience in more than 200 industries and/or types of businesses. He offers a free no obligation consultation for sellers or buyers of businesses.

Bottom Line Management, Inc. is excited to host the first 2011 FREE 2 hour monthly seminar entitled "What You Need to Know When You Are Ready to Sell or Buy a Business" on March 16, 2011.

Preparation is a key factor in buying or selling a business. This free seminar provides an overview of the buying and selling process, offers specifics on how to successfully prepare yourself and pitfalls to avoid.

This Seminar is for:

• Individuals who are interested in either buying or selling a business.
• CPA/accountants interested in providing information to clients interested in buying or selling a business.
• Attorneys interested in providing information to clients interested in buying or selling a business.
• Business Professionals.

To register: Click on the link of the date you prefer below and you will be guided through the easy registration process. If you have any questions regarding registration or the seminar, please contact Bottom Line Management, Inc. email: info@botline.com or call: (770) 977-7334.