What to expect when working with the New York City business brokers
If you are considering working with a business broker, it is important to understand what to expect. First, you will need to provide information about your business, including financial statements, inventory levels, and employee count. Next, the broker will develop a marketing plan to find potential buyers for your business. Once a buyer is interested, the broker will help you negotiate a sale price and terms. Finally, the broker will assist with the closing of the sale and ensure that all paperwork is properly completed. Working with a business broker can be a helpful way to sell your business and get the best possible price for your sale.
The first thing you should expect is a consultation. During this meeting, the broker will ask about your business and get an idea of what you’re looking for in a sale. They’ll also give you an overview of the process and what to expect.
Next, the broker will work with you to set up a marketing campaign for your business. This will include creating a listing, developing marketing materials, and reaching out to potential buyers.
Once buyers start expressing interest, the broker will help you screen them and choose the best offers. They’ll also negotiate on your behalf to get the best amount for your business.
Finally, once a sale is agreed upon, the broker will help with the closing process. This includes handling all the paperwork and ensuring that everything is done correctly.
Working with a business broker can make the process of selling your business much easier. They’ll handle all the details and work to get you the best possible price for your business. So if you are looking to work with the New York City business brokers, be sure to work with a reputable broker.
When you are ready to sell your business, you may want to consider working with a business broker. A business broker can help you determine the value of your business, find potential buyers, and negotiate a sale price. They can also provide guidance on the legal and tax implications of selling your business. Most importantly, a business broker can help you navigate the process of selling your business and maximize the value of your sale.
If you’re looking to sell your business, it’s important to know what to expect from the process. Here’s a look at some of the things you can expect when working with the New York City business brokers.
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How to Choose the Right Business Brokers in New York City
Business brokers can be a valuable resource for business owners looking to sell their businesses. But with so many brokers out there, it can be hard to know how to choose the right one. Choosing the right business broker is an important decision that can make or break the sale of your business. There are a few key factors to consider when choosing a business broker, such as their experience, reputation, and fee structure. By following these tips, you can be sure to find a broker who will help you get the best possible price for your business.
So below are some points to remember while choosing a Business Brokers in New York City:
Experience
When you’re selling your business, you want to make sure you find the right broker. Experience is critical in this process – you need someone who has a deep understanding of the unique challenges and opportunities that are specific to your industry. They should be able to provide insights and guidance that will help you get the best possible price for your business. If they don’t have experience in your industry, it’s unlikely they’ll be able to provide the level of service and support you need. When it comes to selling your business, experience matters – so make sure you choose a broker with a proven track record in your industry.
Reputation
Choose a business broker with a good reputation. Ask around and see what others have to say about their experience working with the business broker.
A business broker’s reputation is important for a number of reasons. First, it reflects the business broker’s ability to build and maintain relationships with clients. A business broker with a good reputation is likely to have a large network of contacts, which can be invaluable when it comes to finding the best deals on properties. Second, a broker’s reputation is a good indication of his or her level of experience and knowledge. A business broker who has been in the business for many years and has a good reputation is likely to be more familiar with the ins and outs of the industry than a newer broker. Finally, a broker’s reputation can also affect the level of service that he or she provides. A broker with a good reputation is likely to be more responsive to client needs and requests than one with a less stellar reputation. When choosing a business broker, therefore, it is important to consider all of these factors in order to make sure that you are working with someone who will meet your needs and expectations.
Fee Structure
Make sure you understand the broker’s fee structure. It should be clear and transparent. Avoid brokers who charge hidden fees.
Location
Choose a business broker who is familiar with the market in your city or town. They should know the ins and outs of the local business community.
References
Ask for references from past clients and give them a call to get their feedback about working with the broker.
By following these tips, you can be sure to choose the right Business Brokers in New York City.
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A Look at the Market Pulse Report
The Market Pulse Report Survey is a resource that has a variety of information that business brokers and M&A advisors regularly utilize to better understand the business landscape. The most recent survey was conducted April 1st to April 15th 2022 and had 360 broker and advisor respondents. It also marked the 40th edition of the quarterly report. The Executive Summary of the report can be accessed here https://www.ibba.org/resource-center/industry-research/
The Main Street Market
One notable fact included in the latest report is that in the Main Street market, between 70% to 80% of buyers are likely to come from within a 20-mile radius. However, with larger companies, it is common for buyers to originate from a distance of over 100 miles away or greater.
The survey also indicated there are two key “headwinds” that businesses are currently facing. These include labor shortages and supply chain issues. Not surprisingly, labor issues are currently creating problems for organic growth. Likewise, supply chain issues can cause prospective buyers to shy away from a business.
The Profile of Current Buyers
The survey also indicated that Main Street buyers not only include the “typical” first-time business buyer. These individuals are often looking for a job in the form of owning a business. Serial entrepreneurs who have made money off previous deals are also now seeking to jump back in and buy another business. The survey indicates that about one-third of buyers who purchased businesses in the $500K to $1M range are serial entrepreneurs.
Additionally, there is a great deal of money flooding into the industry. The money is mostly coming from private equity, family offices, and corporations. Feeling burned by the lack of bank credit by the 2008-2009 economic downturn, these buyers don’t want to get caught in a similar situation again.
A Seller’s Market
The survey indicates that it is currently a seller’s market and that record setting multiples have been occurring. In Q1, an impressive 97% of businesses were receiving their asking price. However, nothing lasts forever. If you’re considering selling your business, it’s a good idea to start making progress now before this trend stops benefitting sellers.
Even with the strong sales track record last quarter, it’s important to note that a fast sale is still improbable. Even in the best economic conditions, it typically takes many months to sell a business.
There are many factors currently benefiting sellers, such as low interest rates, SBA involvement, and people not wanting to work for corporations. However, it’s important not to wait for the “right moment” as often that moment never comes.
It’s always a good idea to begin taking steps to prepare for the sale of your business as soon as possible. This can make a tremendous difference toward fostering a positive final outcome.
Copyright: Business Brokerage Press, Inc.
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3 Ways to Make Your Business Appealing to Buyers
If you are like most business owners, you have never sold a business before and might not have a clear idea of what the process is like. We recommend preparing your business in a way that makes the sale and transition process as easy for your buyer as possible. It should come as no surprise that buyers will like the idea of an easy transition.
It will be very beneficial if you take the time in advance to evaluate the steps and think about what you can do on your end to benefit your buyer. Since you’re the expert on your business, you have unique insights into what would make the transition the most seamless for the other party. When you prepare for the sale with your buyer’s experience in mind, you will likely not only speed up the sales process, but also increase the selling price.
1. Automate Processes
Just like you may have never sold a business before, your buyer may have never bought a business before. If you can figure out how to automate as many processes as you can, it will help with their workflow and reduce the level of intimidation your buyer may be feeling about taking over.
2. Establish a Second in Command
One thing you can do is have a second in command on your staff. If there is a competent employee that your buyer can depend upon for assistance and support, that fact alone will be tremendously attractive. If you do not yet have that person in place, you might have an eye on choosing a person and preparing them for this role. Speaking of staff, you will want to make sure your entire staff is well-trained and any HR issues are resolved in advance.
3. Keep Things Consistent
As you get closer to the time you will put your business up for sale, you will want to begin to work with vendors and key customers. You will want to ensure that the supply chain and significant customers are consistent. Otherwise, this could cause major disruptions for your buyer and impede his or her success. Of course, it goes without saying that you’ll want to keep the potential sale of your business completely confidential. If customers, vendors, and even employees learn about an upcoming sale, this fact alone can lead to a chain reaction of disruptions and problems.
A business broker or M&A advisor can help in a wide variety of ways when you are getting ready to sell. They are experts in maintaining confidentiality while taking you through the sales process from start to finish. Brokerage professionals will also assess your business and inform you of any areas that could be improved to make your business more attractive to buyers.
Copyright: Business Brokerage Press, Inc.
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4 Takeaways from the Latest BizBuySell Quarterly Report
BizBuySell is an online resource that focuses on offering unique content that specifically addresses the needs of buyers and sellers. To make this happen, BizBuySell has teamed with a range of experienced business brokers who are covering topics relevant to business owners, buyers, and sellers. For example, they feature articles that focus on how to make a business more interesting to a potential buyer. These resources help to position BizBuySell as a go-to place for a range of relevant business information.
Of course, every quarter BizBuySell publishes Insight Reports complete with interactive market data. These reports offer a comprehensive overview of trends that are essential for brokerage professionals to know about. The latest report can be accessed here. It covers important trends noted in the first quarter of the year.
Some of the changes that were noted in this important report include the following:
1. Rebounding Transactions
For Q1 2022, the Quarterly Report indicates that transactions are continuing to rebound from the slump of Q2 2020. Year over year, transactions shot up a whopping 24% and are now beginning to return to 2019 levels.
Overall, the main sector that seems to be holding back an even stronger rebound is the restaurant sector, which is still not where it was in pre-pandemic years. However, with that stated, the restaurant sector has also dramatically improved and has shot up by 42% year over year. Yet, the restaurant sector is still down 22% from Q1 2019.
2. Changing Buyer Preferences
When BizBuySell surveyed buyers as to what kind of business they wanted to buy, the numbers were eye opening. 35% of surveyed buyers responded that they were interested in the service sector, and this was followed by 15% of respondents choosing retail. Director of Sales Doug Whitmire stated, “Buyer demand seems to be leaning toward business services, self-storage, car washes, as well as advanced distribution services for manufacturers. There have been few opportunities, so buyers are flocking to them and inventory is limited.” The result of the limited inventory is record sales prices.
3. Listing Growth
In Q1 2022 listing growth has increased substantially, with service listings up 14%. While the restaurant sector is obviously still lagging, it is important to note that the Quarterly Report indicated that restaurants were experiencing a 10% growth. If the pandemic continues to recede, we could see a robust rebound in the restaurant sector.
4. A Boom in Sellers
The Q1 report also indicates that sellers, who have previously been sitting on the sidelines, are deciding that now is the time to sell. Once again there is talk of a “silver tsunami” approaching as Baby Boomers begin to sell. It is also interesting to note that many of those who are selling are doing so due to burnout. Importantly, burnout is occurring for a variety of diverse reasons, ranging from supply chain and labor issues to pandemic burnout.
Advice for Sellers
The BizBuySell team strongly advises that sellers should fix major supply chain issues before entering the market. Whitmire noted, “We try to get our clients to work with us to fix those issues before we go to market. Many times, you only have one chance with a buyer and then you lose them.” It definitely makes sense for sellers to try their best to remedy any issues that might have resulted from Covid-related circumstances. This will ensure that the sales process goes as smoothly as possible.
Copyright: Business Brokerage Press, Inc.
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The True Meaning of a Fairness Opinion
Many people assume they know what “fairness opinion” means because they are familiar with the term “fair market value.” Fair market value refers to a price that is reasonable for both a buyer and seller in an open and competitive market. However, a fairness opinion is quite different. This term refers to a report that evaluates the facts of a merger or acquisition or any other type of business purchase.
A fairness opinion is typically in the form of a letter that contains an actual opinion and justification of why a selling price is fair. Of course, there are limitations, as this report is fully based on information that has been provided by the management of the business.
Who Prepares a Fairness Opinion?
A fairness opinion must be prepared by a professional with expertise in business valuation. It is typically done by a business intermediary or appraiser. An investment banker can also prepare a fairness opinion. Although the professional who prepares the fairness opinion may very well have experience in structuring deals, this letter does not include any information or opinion on the deal itself. It also doesn’t include advice or recommendation. In preparing the report, the advisor seeks to look at the deal from the perspective of the investors.
Basically, it is structured to specifically comment on fairness from a financial perspective, based on the information on hand.
Who Uses Fairness Opinions?
You will most frequently see fairness opinions utilized in the sale of public companies by the board of directors. When this document is received, it shows that the board is working to protect the shareholders. Of course, fairness opinions can also be used for private companies. In this case, it can serve to protect the interest of shareholders or family members who may later look to challenge the sales price. However, in most situations that involve middle market private acquisitions, a fairness opinion is not necessary.
In the end, a fairness opinion assists with communication and decision-making. It serves to lower the risks surrounding a deal. This important document can be used in court if a shareholder later decides to file a lawsuit against the director of a company.
Copyright: Business Brokerage Press, Inc.
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