Home based business in Coastal Georgia – work 6 months and get paid for 12 months.

This well respected annual publication with decades of profitability and a loyal customer base in Coastal Georgia allows you to work only part of the year to earn a full year's pay. You work your own hours and customers routinely contact you to renew their ads. Many improvements have been well-received by the business customers with future improvements planned.

There are many print and recorded testimonials by prominent business owners.

Financial Information

• Asking: $225,000
• Gross: $128,923
• Cash Flow: $71,318
• Furniture, Fixtures & Equipment: $5,000
• Inventory: $1,000 (included in price)
• Financing: $150,000 down with $75,000 @ 6% over 36 months
• Seller financing is available

General Information

• Facilities (Home Based): The business is home based and can be run by anyone who lives in the surrounding area. ***Included: phone number; website; all CDs to beginning of time; all phone books; all working files; all software; Adobe Indesign Creative Suite included
• Competition: 1,000 brochures are distributed to new places in the surrounding area. The business is a member of the Chamber of Commerce and another group.The company buys a monthly list of everyone who has bought a new business license and distributes a directory to each new business owner
• Growth and Expansion: Hire more commission salespersons to market to outreaching areas.
• Support/Training: The current owner will introduce the new owner as the co-publisher during the first month and be available by phone assistance for 6 months afterwards
• Reason Selling: Owners retiring
• Employees: 1PT + 2 owners

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

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

Profit margins are healthy and customers are very loyal!

Looking for a successful business to purchase? Here is your opportunity!

Once every 5 years, a business like this becomes available. It's a really fine tuned machine. The staff is well trained and extremely friendly to customers and fellow employees alike. There is a branch office in Indiana manned by a key employee who is home-based. This employee knows everything there is to know about the business.

The business mails catalogs to 13 states to derive most of its business. It only carries the finest products. Profit margins are healthy and customers are VERY LOYAL.

Financial Information

• Asking: $1,000,000
• Gross: $2,018,446
• Cash Flow: $224,932
• Furniture, Fixtures & Equipment: $30,000
• Inventory: $180,000 (included in price)
• Financing: SBA pre-qualified

General Information

• Location: Metro Atlanta, Georgia 30041
• Facilities: 5,500 sq. ft. of warehouse and office space in commercial industrial park. Rent is $2,500/month.
• Competition: This business prides itself on offering the finest customer service available.
• Growth and Expansion: Since the business is just mailing to 13 states, by expanding the mailings to the other 37 states and Canada, the business can easily be doubled.
• Support/Training: Owners will assist a new owner for 4 weeks.
• Reason Selling: Retirement.
• Year Established: 1996
• Employees: 6ft & 3pt

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

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.

Once every 5 years, a business like this becomes available. It’s a really fine tuned machine with a brand new inventory control/shipping system. The staff is well trained and extremely friendly to customers and fellow employees alike.

There is a branch office in Indiana manned by a key employee who is home-based. This employee knows everything there is to know about the business. The business mails catalogs to 20 states to derive most of its business. It only carries the finest products. Profit margins are healthy and customers are extremely loyal.

Financial Information

• Asking: $1,150,000
• Gross: $2,020,142
• Cash Flow: $189,669
• Furniture, Fixtures & Equipment: $30,000
• Inventory: $180,000 (included in price)
• Financing: Seller will finance $150,000 @ 6% over 10 years with 4 year balloon.

General Information

• Location: Metro Atlanta, Georgia 30041
• Primary Category: Wholesale/Dist. – Durable Goods
• Facilities: 5,500 sq. ft. of warehouse and office space in commercial industrial park. Rent is $2,500/month.
• Competition: This business prides itself on offering the finest customer service available.
• Growth and Expansion: Since the business is just mailing to 20 states, by expanding the mailings to the other 30 states and Canada, the business can easily be doubled.
• Support/Training: Owners will assist a new owner for 4 weeks.
• Reason Selling: Retirement.
• Year Established: 1996
• Employees: 6ft & 3pt

Contact Information

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

If you guessed “jail”, you have either owned a retail store or worked in one. In my 25 years of being a business broker, I cannot tell you how many hundred times a buyer prospect has said to me, “I want a light manufacturing company or a distribution company but not retail. If you wonder why owning and working in retail is like a form of jail, keep reading.

With retail, you are faced with periods of inactivity and loneliness interspersed with periods of extreme activity. There is no way to know when you will be inundated with customers or left staring at cobwebs. Even taking a bathroom break can cause you to lose valuable business.

With retail, you have decisions to make as to what days you are open and what hours you work each day. If you are in a mall, those decisions are made for you by the warden or more affectionately known as the property manager. Even if you know from experience that on certain days and during certain hours, there will not be enough business to justify paying employees and keeping the store open, you are forced into hard labor regardless of the expense.

Then you have the issue of store openings and store closings. Most new business owners start out opening their stores early in the morning and closing them late at night. Then over time, they try to find an employee they can trust to do one or the other or both. But if that employee calls in sick or doesn’t show up for any other reason, the owner has to stop whatever they are doing and head back to the store.

This means those dinners, movies, sporting events, children’s activities, social events, etc. will be unexpectedly interrupted and quite a bit of disappointment will occur. Thus you never know when your life schedule will be thrown out of kilter. This uncertainly takes a toll on all family members.

Of course you have the issue of the lease agreement. The lease is a form of handcuffs that binds you to a commitment regardless of personal or business circumstances. The restraints are made tighter by way of the personal guarantee that is required where one or both spouses figuratively and literally imprison themselves. Should you ever try to seek relief from the lease agreement, it is solely in the hands of the landlord or property manager to determine whether your sentence is made shorter or if you can be paroled.

In the fourth quarter of every year, you have good news and bad news. For the most part, retail businesses live or die based on fourth quarter results. This is after enduring and trying to survive the first nine months of the year. And you always have to watch your back to make sure the competition doesn’t manhandle you.

Then we can deal with public failure coupled with embarrassment and humiliation. Your credit record will be severely damaged if you file for bankruptcy or break your lease. Items other than bankruptcy will damage your life for 7 years, and a Chapter 7 bankruptcy will hang over your head for 10 years. You will have a record that will haunt you for a decade and affect the cost of anything else you attempt to buy, finance, lease or rent. Your record will be expunged after 10 years, but the scars will last a lifetime. Applying for a job, renting an apartment, buying a car, obtaining different types of insurance, buying a home, etc. will always be constant reminders of your incarceration.

So in conclusion, anyone considering the purchase or startup of a retail business needs to fully understand everything that’s on the line. One false step by you or an employee can have life long and devastating circumstances for you and your family members. Now, I hope you understand why you should think jail when the word retail is mentioned or suggested.

Even though there maybe challenges as outlined in the article having the right tools such as using a business broker will not only help you avoid some of these pitfalls but will help make the sale or purchase of a business a smooth and successful one.

The most important reason to use a business broker is to have someone who routinely must “think outside the box.” Someone who has worked in this industry for over 20 years has probably seen almost anything imaginable. They have been called upon to mediate transactions in order to help sellers and buyers put their egos aside for the benefit of the deal. Creativity can save a transaction that has been stopped dead in its tracks. The business broker brings this creativity to the equation to help solve the problem and make everyone a winner.

Most people will purchase or sell only one business in a lifetime. You’ve got to get it right the first time. Let Bottom Line Management, Inc. show you what we can do for your bottom line. As leaders in business sales, acquisition, valuation and management services for over 25 years, Bottom Line Management, Inc. has accrued experience in over 200 industries and exceeded the expectations of hundreds of clients.

Beginning in March 2011, a FREE 2 hour seminar will be offered monthly to help people sell and buy businesses. The seminar is entitled “What You Need to Know When You Are Ready to Sell or Buy a Business.” Registration is required and attendance is limited. Stay tuned for more details – visit our website for updates.

Loren Marc Schmerler, CPC, APC is President and Founder of Atlanta based Bottom Line Management, Inc. He has been a business consultant for 40 years, a business broker for 25 years, and a public speaker at Inc. Conferences, BellSouth Symposiums and STAPLES new store openings. During the early 1990’s, Mr. Schmerler was the first and only business advice columnist for Sam’s Club where he used actual case histories to illustrate business problems and their solutions. Mr. Schmerler has experience in more than 200 types of businesses and/or industries. Bottom Line Management, Inc. offers both Seller and Purchaser representation.

For immediate release

Contact Loren Marc Schmerler
LMS@BOTLINE.COM
Cell 404-550-1417, Office 770-977-7334
www.BOTLINE.com

ATLANTA, GA. The economy may be in the doghouse, but Georgia businesses that pamper pooches and caress kittens are doing well.

Schmerler with his dog Sydney

Last year, top Georgia business broker Loren Marc Schmerler helped owners sell two pet-centered businesses, and says such businesses are bucking the economic trend. Although Schmerler, a member of the Georgia Association of Business Brokers’ 2009 multi-million dollar club, sells all kinds of businesses, he has noticed that pet-related businesses always generate a high level of buyer interest.

“Every time I get a listing for a pet-related business, I get interest nationwide,” says Schmerler, President and Founder of 24-year-old Bottom Line Management, Inc. in Marietta. “We receive multiple offers.

At the last sale, we had four parties making offers at the same time for the business. That’s unheard of in this business. Usually, we’re lucky to get one offer.”

The American Pet Products Association estimates that Americans will spend $47.7 billion on their pets in 2010. The APPA’s annual comprehensive review shows spending on animals, food, supplies, veterinary care, grooming, boarding and pet sitting jumped to $45.5 billion in American in 2009, up from $43.2 billion in 2008. According to the 2009/2010 National Pet Owners Survey, 62% of U.S. households own a pet, which equates to 71.4 millions homes.

Pet owners take children to daycare, and they take their pets to doggie daycare, notes Schmerler.

Mike Ringuette and Melissa Woodhead worked with Schmerler to purchase Kelsey’s Dog House in Buckhead. The partners said they were seeking to buy a business that had a sustainable long-term business model, redeeming society values, and a pre-existing establishment with reasonably sound fundamentals.

People interested in getting into the pet business should know that there are advantages to buying an existing business, Schmerler said.

“An existing business has a track record and a customer base which allows you to analyze profitability,” says Schmerler. “Potential buyers can examine tax returns and financial statements and determine whether the business is profitable.”

With most businesses, a general rule of thumb is that they are worth two to three times the businesses discretionary cash flow of the business.. “In today’s environment, people are willing to pay three to 3.1/2 times” that for pet businesses, Schmerler says.

Schmerler says, “when I have listings for pet-related businesses, Internet websites, and distributing or service-based businesses, I am always able to sell them quickly and profitably.”

“Quite frankly, it’s amazing how fast businesses priced correctly and realistically sell,” says Schmerler. “In fact, often those companies are sold within three to four months.”

Ringuette says he enjoyed playing and caring for a variety of dogs, but was pleased to find out “how truly special the employees and customers in this business are.”

“Our employees really love animals,” said Ringuette. “Their genuine enjoyment at work is infectious both in how they care for the dogs, how they team across different areas of work, and their care and compassion for the dogs.”

Pet grooming and boarding businesses are popular because “pet owners need to have some way for pets to be cared for while they are at work,” says Schmerler. “People who enjoy traveling want to be sure pets can be well cared for in their absence.”

“The reason that this type of business is desirable is that it’s fun,” says Schmerler. “You’re not sitting behind a desk all day.”

Woodhead has been working with animals ever since she was 11, when she started working for a veterinarian. She previously owned a full-service veterinary hospital, but decided that she enjoyed doggy daycare and grooming the most.

“There’s nothing like seeing a happy, satisfied client pick up their dog after playing with their friends and sparkling after their groom,” says Woodhead.

“We’ve been approached by many clients and competitors about how we have been able to enjoy double digit growth the past several years during these very challenging economic times,” says Woodhead. “ Our response has been by remaining true to our core values of hiring the best employees that have a collective passion to always provide the best experience for our clients’ dogs and their families.”

Because people tend to humanize their pets, APPA President Bob Vetere says the gap in quality of life between humans and their pet companions is quickly disappearing in all categories from food and clothing to health care and services.

“These higher quality products and services combined with a strong consumer focus on their pets’ well-being, make health and wellness the most powerful trend in 2009 across the entire pet industry,” said Vetere. “We feel our pets give us so much it is no longer enough to simply give them a treat. We want to keep our pets healthier, longer, and are willing to spend what it takes to make it happen.”

“Many people are out of work and thinking of going into business for themselves,” said Schmerler. “Pet-related businesses have weathered the recession better than other businesses, and, if managed well, ought to thrive when the economy turns around, as it appears ready to do.”

# # #

Recently, I read an excellent article about becoming an entrepreneur by Jeffrey Bussgang from the Harvard Business Review titled, “Should I Become an Entrepreneur?”

The article addresses many points to consider when thinking about owning your own business. This article outlines important questions to ask yourself if you are interested in taking the next step to becoming your own boss.

I offered a comment to the article about a less risky alternative than starting a business from scratch and that is to buy an existing business.

“Having been a Business Consultant for 40 years and a Business Broker for 25 years, there is a less painful way to become an entrepreneur. Buying an existing business with an established and verifiable history is superior to starting from scratch with no customer base. If the business is profitable, you can always use your creativity to tweak it to make it better.” – Submitted by Loren Marc Schmerler, CPC, APC – President and Founder of Atlanta based Bottom Line Management, Inc.

Below is the article or click here to link over to the Harvard Business Review.

Should I Become an Entrepreneur?
2:31 PM Friday January 21, 2011
by Jeffrey Bussgang

When to become an entrepreneur is a common quandary for many. For whatever reason, this issue has come up a great deal recently (recession-driven workforce dislocation?), so I thought I’d share a few thoughts that might help frame this critical decision.

I have concluded that being an entrepreneur is an irrational state of being. If human beings were purely rational, evaluative, value maximizing individuals (see HBS Prof Michael Jensen’s paper on self-interest and human behavior (link PDF)), they would not start companies. If they sat down and did the expected value calculation by laying out the probability-weighted outcomes of being an entrepreneur as compared to taking a safe job, it would not pencil out.

Yet, entrepreneurship is not simply a rational journey. It is one that is defined by passion and personal satisfaction that transcends purely financial analysis. And, of course, there is always the hope for the big payout, no matter how long the odds.

Despite popular wisdom to the contrary, age is not a major factor in the decision to start a company. The Kauffman Foundation reports that the median age of founders is 39 – right at the midpoint of a typical professional career – and 69% are 35 or older. Another study by Washington University professors of 86,000 science and engineering graduates showed that age was not a significant predictor of becoming an entrepreneur.

So when should you become an entrepreneur. Here are the kinds of questions you should ask yourself:

Do you have an idea that no one can talk you out of? When you bounce your start-up idea off your spouse, friends and trusted advisors, are they able to raise enough objections that you begin to doubt whether the idea has merit. Getting honest, objective advice can be hard because the people you are likely to go to care about you and may be afraid to tell you what they really think for fear of offending you. Thus, you need to get feedback from objective parties (e.g., advisors, experts, prospective angel or VC investors with whom you don’t have a deep personal relationship).

Do you have a partner you trust with complimentary skills? Starting a company is a lonely adventure. Having a partner that you can trust and whose skillset and experience is complimentary to yours can be a huge functional and emotional benefit.

Are you prepared to endure with modest or no salary for a few years? Founding a company often means making personal sacrifices and below-market cash compensation. All the talk about “lean start-ups” (which I’m a big fan of) sometimes obscures the practical reality of what it means to eat through your personal savings.

Are you bored with your current work environment/life situation? There is nothing boring about being an entrepreneur. More apt adjectves might include stimulating, engrossing, obsessive, exhilarating, nerve-racking – but not boring. If you are tired of viewing your work as a chore and if every day is a bit of a grind, then entrepreneurship is for you. I find that the intrinsic motivation behind an aspiring entrepreneur is sometimes the simplest – because it’s fun. Seeking fun can transcend all other factors.

Do you perform best in the absence of structure? In my book, Mastering the VC Game, I describe a metaphor for the three stages of a start-up: the jungle, the dirt road and the highway. In the earliest stages of a venture – the jungle – there are no clear paths available and the skills required are to thrive in the midst of the chaos. For those who possess that makeup, being a start-up executive is an excellent fit. But for those that like clear paths with little uncertainty and a great deal of structure – the highway – an early-stage venture will feel like a very uncomfortable environment.

Reflecting on these questions, I find it intriguing to reflect on what kind of environment – either from the perspective of parents raising their children or policy makers thinking about encouraging entrepreneurial ecosystems – can be created to foster more entrepreneurship? HBS Professor Noam Wasserman is writing a book called Founding Dilemmas which is coming out later this year (I’ve read early drafts and believe it will be a must-read for entrepreneurs). In it, he quotes career guru Dr. Tim Butler who points out that signals from parents, mentors and local leaders have a large influence on whether people chose to become entrepreneurs. “We receive very powerful messages [from those around us] about what’s important, what success is, what failure is, what counts for achievement and what doesn’t. ”

Celebrating entrepreneurial success stories in our culture and putting folks like Steve Jobs, Bill Gates, Larry Page (the new Google CEO!) and even more accessible, local heroes on magazine covers and in front of audiences is obviously a huge factor. Every college kid in America looks at Mark Zuckerburg and thinks, “Why not me?” Why not, indeed?

Jeff Bussgang is a general partner at Flybridge Capital and an Entrepreneur in Residence at Harvard Business School. He is author of the book, Mastering the VC Game.This post originally appeared on Jeff’s blog, Seeing Both Sides

As leaders in business sales, acquisition, valuation and management services for over 25 years, Bottom Line Management, Inc. has accrued experience in over 200 industries and exceeded the expectations of hundreds of clients.

The Bottom Line Management, Inc. YouTube channel provides tips on buying and selling a business or simply evaluating your options. Check out these latest help videos below or visit Bottom Line Management YouTube Channel.

Key Employees and the Sale of Your Business

Private Equity Groups and Acquisitions

Internet, Online, eCommerce, and Home Based Businesses

Preparing your Business for Sale and Maximizing it’s Value

2011 is a great time to buy or sell an existing business. Read why 2011 is a good time to become your own boss or sell your business to move onto a new project.

Reasons to Buy a Business

1. Many baby boomers are reaching the retirement age of late fifties or early sixties. From my experience, the most common age when business owners call me is 62. They are tired of working 40+ years since high school, the last 15 to 20 years as owners of their own businesses. The available supply of good and well established businesses has never been greater.

2. When you find a business you want to buy, the owner will be more receptive to both traditional and creative financing. Traditional financing would be where an owner holds a note for part of the purchase price. Interest rates are roughly 6% for owner notes at the current time. Creative financing would be assumption of liabilities or earn outs. Earn outs are based on a percentage of sales above certain thresholds.

3. SBA preferred lenders are more willing to make loans due to relaxed federal guidelines and the elimination of certain costs and fees. While you will not be able to obtain an 80% loan like the good old days, you should be able to easily obtain a 65% loan with you making a 25% down payment and the owner holding a 10% note.

4. Vendors are highly motivated to make sales. Their businesses have suffered financially during the last 2 years. As a result, you should be able to purchase inventory, supplies and other materials at substantial cost savings.

5. Due to the millions of unemployed workers, the labor pool is loaded with qualified and motivated prospective employees. Additionally, existing employees at the company you purchase will be highly motivated to stay with the company, since finding another job will be quite difficult.

6. You are now able to use 401k funds, IRA funds, Sep-Ira funds, etc. to purchase a business. There are many tax advantages to doing so, and you can control how much you may yourself for salary and how much you keep within the C Corporation tax free.

Reasons to Sell a Business

7. With millions of unemployed workers living off of their savings and retirement plans, there is a high demand for good businesses. And due to the unprecedented demand, multiples of Owner’s Discretionary Cash Flow are exceeding 3 where in the past the multiples ranged between 2 and 3. Thus there will never be a better time to put your business up for sale.

8. Since unemployed people have had their 401k plans and savings devastated, and they are tired of only earning .25%, they need an alternative plan. The tax code allows them to purchase a business using retirement funds and creating a C Corporation. Once the Corporation is created, all profits can grow tax free, and the new owners are not obligated to disburse profits, dividends or salaries.

9. If you are in your late 50’s or early 60’s, there is no way to know what the future may hold. Regardless of your current health, it can change unexpectedly. Or you may have issues with aging parents. By selling now, you can remove some of the uncertainty.

10. If you are willing to provide owner financing for some or all of the purchase price, you can earn interest in the range of 6% which is more than 20 times what a bank will pay you.

11. SBA financing is loosening up which will allow more prospective buyers to have an opportunity to buy your business.

12. There comes a time when quality of life becomes more important than money. Only you can decide if obtaining freedom trumps obtaining money and to what extent.

13. There are investment vehicles that will allow you to defer most or all of the seller’s proceeds. Thus there will be little or no tax liability due in the year of sale. You can work with a financial professional to set up a residual income stream that will meet your needs and spread the capital gain over many years.

If you are unsure of what type of business opportunity to purchase or looking to sell your business but are unfamiliar with what steps to take, Bottom Line Management, Inc. provides a FREE Consultation with no obligation.

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 and explain the entire selling process. Call (770) 977-7334 or click here to contact Bottom Line Management, Inc. to schedule a FREE business broker consultation.

Author’s note. After helping sellers and buyers for more than 20 years, I have found that honesty, integrity, full disclosure, patience and a willingness to consider various alternatives makes the probability of success for all parties very high.