Selling a small or big business is a complex venture that involves many considerations. It can require that you enlist a broker, accountant and/or an attorney as you proceed. Whether you profit will depend on the reason for the sale, the timing of the sale, the strength of the business’s operation and its structure.
The business sale will also require much of your time and, once the business is sold, you’ll need to determine some smart ways to handle the profit. Since this is a very important decision that in most cases affect your future and your family future as well, www.cambiohispano.com talked to Russell Cohen with Murphy Business & Financial Services LLC in Davie, Florida, an expert in selling business with more than 18 years of experience to review some considerations that can help you to build a solid plan and make negotiations a success.
- Reasons for the sale in Florida
According to Mr. Cohen, “A lot of people relocate down to South Florida in their 50s, when the children are out of the house and they move to Florida in the last 10 or 15 years of their work, so they buy a business from people that grow up here, people of a generation of Florida citizens that now are in their 50s or 60s –those are the sellers-.
“We are going to probably see over the next ten years a very robust amount of business coming out of the market owners, taking equity out of their business and selling their business, as long as the economy is well and the foreigners are welcome, we are going to see a lot of people coming to the south, people moving to Florida because of the weather, so this is a good time for south Florida” Mr. Cohen said.
- Timing of the Sale
It is important to prepare for the sale as early as possible, most likely a year or two ahead of time. The preparation will help you to improve your financial records, business structure and customer base to make the business more profitable. “When Obama took office we were in recession and when he left we were coming out of the recession and the economy was getting better and right now we’re in a very strong economic position, the last couple of years of the Obama’s administration we were in a good economic position and with Trump we are still with that, the economic trust is going forward, so I think business owners held back in the bad economy from selling because their earnings were lower and now when business is going so well, they have the opportunity to sell at a better valuation because their earnings are up and their values are up”, Mr. Cohen States.
4. Selling your business with a Broker
Why Choose Murphy Business?
[The following paragraphs were taken from www.murphybusiness.com home page]
The sale of an active business is more effectively managed by a professional business broker who is experienced in all aspects of the transaction. Buying and selling a business demands a level of expertise that you get from seasoned Business Brokers. We are one of the largest and most successful business brokerage firms in North America with business brokers conveniently located throughout the United States and Canada.
Service & Expertise
For business owners considering the sale of their company, Murphy’s experienced business brokers will provide the following services:
- Determine the market value of the business be sold
- Prepare an informational package describing the business to be sold
- Market to prospective buyers on behalf of the seller on a confidential basis
- Qualify prospective buyers on their financial capability and their sincerity in buying
- Assist the seller in evaluating offers and negotiating terms of the transaction
- Facilitate the consummation of the transaction in conjunction with the seller’s tax and legal advisors “Keep in mind that a broker can help free up time for you to keep the business up and running, or get the highest price (because a broker want to maximize his or her commission) Brokers also have a huge amount of contacts and business persons that may be interested in buy your business”
5. The first step when you are coming from abroad.
Coming from other country to establish or buy a business can be a hard task and you could face many risks as well. So this is a valuable advice from our expert, Russell Cohen. “My first recommendation for any potential buyer who lives outside US is to hire an immigration attorney to set the expectations, know the requirements and all related with business records, employees and depending on the visa, what type of business they can run, so the first step before calling a business broker is to get educated call an immigration attorney, so when you call a business broker you are not looking everything on the market, but the business that help with the situation”.
Mr. Cohen states that 30% to 40% of the transactions in his company are with foreign investors. An important advice for people coming from abroad, “Is very hard for people coming from other countries, to buy business build on the owner relationships, it is something very difficult to sustain so I would recommend to buy a business that do not depend on the relation of the owner and their clients”.