BayState Business Brokers Blog

Don't Miss This Great Training for Business Brokers/Buyers/Sellers

On April 9th and 10th, in Woburn, MA, at the Holiday Inn Select, the New England Business Brokers Association is hosting a Conference titled "New Decade, New Opportunities." The conference offers IBBA classes and workshops and is open to the public. You can learn more about the Conference and sign up for the classes and workshops at the NEBBA website.

Many of the classes and workshops at the Conference can be of value to individuals interested in buying or selling a business. There is a workshop that covers the basics of business valuation. There are two workshops that cover different ways to finance the purchase of a business. Anne Hunt, the Lead Lender Relations Specialist at the Boston SBA office, will conduct a workshop on SBA financing. Larry Carnell, of Benetrends, will explain how to use IRA funds to buy a business.

Two workshops will help individuals interested in buying or selling a business understand the sales process better. Scott Loring will present a workshop on negotiating. Marc Gudema, the writer of this blog, is conducting a workshop on managing the closing process. This workshop will present some of the problems that arise during closing and how to handle them.

There are two workshops that cover lead generation. Although they are focused on business broker lead generation, the information would be useful to any business owner. Debra Murphy will conduct a workshop on how to drive visitors to your website and increase your visibility. Glen Cooper will present a seminar on how to use LinkedIn to generate leads.

Most of the workshops are of value to business owners, but there are two workshops in particular that owners thinking of selling their businesses shouldn't miss. Michael Coyle will present a workshop on Exit Planning. Ira Bryck, the Director of the University of Massachusetts Family Business Center, will conduct a workshop on the problems of selling a family business.

There are three IBBA courses being taught. Each is an all-day course. On Friday, Richard Mowrey is teaching course 301, Introduction to the M & A Process. In addition to business brokers, this course would be valuable to other advisors who are interested in learning more about what's involved in the process of mergers and acquisitions. Covering both days are courses 220 and 221, Pricing Businesses.

Three workshops are being offered specifically for business brokers. Ted Burbank, who wrote a book on the subject, will teach a workshop on how to obtain up-front retainers. Jeremy Poock, an attorney, is conducting a seminar on what business brokers should do avoid legal pitfalls. Phil Steckler is leading a workshop on the attributes of successful brokers.

The cost to attend the workshops and courses is very reasonable. If you live within driving distance of Boston, there is no cost for travel or overnight stay as there would be with attending an IBBA Conference where these classes and workshops are normally presented. Check out the NEBBA website for more information and to sign up. Registration for the workshops is by one day or both. This is a great opportunity to attend workshops and increase your understanding of the buying and selling process at a very reasonable price.

Buying a business? What a business broker should have told you.

Buying a business is different from buying anything else. Understanding how business brokers think and operate can help you to be a better buyer. Here are some truths that we operate from:

• At least 90% of the prospective buyers who contact us won't buy a business-from us or anyone else.

• On the average, a business has to be introduced to about 30 buyers to sell it.

• Having enough money to buy a business does not set you apart. Many buyers have the money to buy a business.
• It takes a lot of time to work with a buyer to sell a business. So we try very hard to be sure the buyers we work with are serious.

• Business brokers believe that a good business, priced reasonably, with a good seller will sell. Understanding what a "good" business is could be a topic for a whole blog, but at the very least, it means a business in a desirable industry, at a reasonable price, with available financing, with real numbers that demonstrate that the business will generate an adequate income to a buyer.

What all of this means is that it is important to our success to figure out, as quickly as possible, which buyers are in the 10% group that are actually likely to buy a business and which are in the 90% group that won't. Otherwise, we will waste a lot of our time working with tire kickers. Here are the things we look for to figure out which group you belong in:

"You show me yours and I'll show you mine" You are asking to see a lot of highly confidential financial information about a business. If you won't give us similar information about yourself, you won't be shown information about the seller's business. If you own a business, that, by itself, does not tell us anything about your financial situation.

It takes reasonable, and flexible, people to get a deal done. If your attitude is "it's my way or the highway", we are likely to let you hit the road. What do we look for? Do you give us information about yourself easily? Do you make a federal case out of the language in our confidentiality agreement? How do you treat us? We are not interested in introducing our seller to difficult, unpleasant people who are not likely to buy a business.

How can you stand out from the crowd? Take actions to show us you are serious. Come into our office and meet with us. Visit businesses you are interested in. Give us a phone call to remind us that you are still looking for a business to buy. This may not be what buyers normally do, but buying a business is not like buying anything else.

If you are serious about buying a business, you need to communicate. Respond to communication from us. If you look at a business, let us know what your interest is. Think about the broker's point of view: if we have to chase you to communicate, how likely is it that you have the drive to complete the purchase of a business?

Unless you have all of the purchase price in cash, you will need a loan to buy a business. Whether the lender is a bank or the seller, they will want to see business experience that relates to the business you want to buy. We do this screening right up front so we don't waste anyone's time working with an unqualified buyer.

Your personal situation reflects how motivated you really are. There is not much you can do about these issues, but we look at them. Do you have a corporate job that pays $150,000 a year? We question whether you are going to leave it, particularly in this economy, to take the risk of owning a business. On the other hand, if you are unemployed, come right in.

Finally, keep these things in mind, because they are extremely important:

Be honest. If you have a skeleton in the closet that could affect your buying a business, let us know about it. We want to sell businesses and may have a solution to your problem.

Maintain Confidentiality. This is the top concern for most sellers. If you ever violate confidentiality, that will be the end of our showing you any businesses. Don't tell your friends and relatives, who do not have a need to know, that you are looking at a particular business.

As a buyer, I hope these insights help you understand how brokers think so that you can be more successful in working with a broker to find the business you are seeking. We look forward to working with you, so contact us to schedule a meeting with one of our professional brokers.