Keys to Improving the Value of Your Company
The first key is to have your accountant take a look at your accounting procedures and make recommendations on how to improve them. He or she may also help in preparing financial projections for the coming year(s). Getting your company’s financial house in order is very important in establishing the value of your firm. The…
What Are Your Company’s Weaknesses?
Every company has weaknesses; the trick is to fix them. There is a saying that the test of a good company president or CEO is what happens to the company when he or she leaves. Some companies–on paper–may look the same, but one company may be much more valuable due to weaknesses in the other…
When Is A Company In Trouble?
Companies can be in trouble or headed for it for many reasons. However, most of them can be linked to one or more of the following: • Lack of proper focus • Poor management • Poor financial controls • Loss of key employee(s) • Loss of important customer(s)/client(s) • Not keeping up with technology • Quality control or other operating issues • Legal…
What Sellers Don’t Expect When Selling Their Companies
In the proverbial “perfect world,” business owners would plan three to five years ahead to sell their companies. But, as one industry expert has suggested, business owners very seldom plan to sell; rather, selling is “event driven.” Partner disputes, divorce, burn-out, health, and new competition are examples of events that can force the sale of…
How Does Your Company Rate?
Valuation of private companies is much more subjective than public companies because there is no free trading marketplace for the private companies’ stock. Just like a champion Olympic figure skater, the performance has to be flawless. Take a look at the following check list – see if the target company rates near perfect (on a…
Points to Ponder for Sellers
Who best understands my business? When interviewing intermediaries to represent the sale of your firm, it is important that you discuss your decision process for selecting one. Without this discussion, an intermediary can’t respond to a prospective seller’s concerns. Are there any potential buyers? When dealing with intermediaries, it always helps to reveal any possible…
Mistakes Sellers Make
• They neglect to run their business during the sales process. – The owner of a business with sales under the $20 million range can get so involved in the selling process that they neglect the day-to-day operation of the business. • They don’t understand the “real” value of their business. – A business may actually command…
Fairness Opinions
Since one often hears the term “fair value” or “fair market value,” it would be easy to assume that “fairness opinion” means the same thing. A fairness opinion may be based to some degree on fair market value, but there the similarities end. Assume that you are president of a family business and the other…
Learn the Dynamics and Save the Deal
Many business owners are unfamiliar with the dynamics of selling a company, because they have never done so. There are numerous possible “deal breakers.” Being aware of the following pitfalls and their remedies should help prevent the possibility of an aborted transaction. Neglecting the Running of Your Business A major reason companies with sales under…
Expediting Change Post-Closing
The deal is done and you have completed the closing. Now what do you do? You help the new owner because chances are that you have some vested interest in the new entity, and it is in your best interest that the new owner is successful. For example: – there may be an escrow account due…