How to Qualify a Business Buyer

The process of selling a small business can seem intimidating. Most people are unsure of the steps involved. Listing your business for sale with a professional business brokerage is an advisable step. A business broker will assist you throughout the listing process including determining an appropriate list price. They will also market your business to find qualified buyers. A common mistake that business owners make is that they assume that a business broker’s only role is to ‘find’ them a buyer. This is a misconception that business intermediaries are often faced with.

Although a business broker may find prospective buyers, the real key is to qualify them. Some business for sale listings may require that a business brokerage interview up to 50 or more interested parties. The goal is to filter out the purchasers that are not qualified for one reason or another. It is often stated that up to 90% of business ‘buyers’ will actually never purchase one.

The purpose of this article is to go over some of the criteria that business brokers may use when qualifying business buyers.

Financial ability
A buyer must have the financial resources in place in order to consummate a deal. The reality is that you cannot buy a company with 10% down. For a small business, it is not unrealistic to expect an interested party have at least 35-50% of unencumbered funds available for a purchase. They must also have access to financing and credit to finance working capital needs. An overall understanding of the financing required is a good first step to qualify a buyer. A business broker may also ask for a credit check to be run or to see a personal net worth statement if required.

Ability to operate the company
A prospective business purchaser must also have the skill (or ability to learn) to be successful in the venture. For instance, a hair salon likely will need someone with a suitable background or plan to get staff in place that do have the appropriate backgrounds.

How long have they been searching for a business
Buyers who have been looking to buy a business for an extended period of time may be too unrealistic about what they are expecting to find and may be the consummate ‘searchers’ and never find anything. A business broker may pause when approached by someone stating they have been browsing for the past 2 years.

Why is the buyer looking to buy a business?
A good business intermediary may find out why a person is looking to buy. If they recently lost a job they may see business ownership as a good next step. The truth is that most corporate employees possess a different risk tolerance from entrepreneurs so, relatively speaking, few of them actually buy a business. Instead, most end up finding another corporate position and going back to the working world.

Enthusiasm for the business is another characteristic to look for. The key to qualifying a person is to really find someone who is a right fit on all fronts. Consult with a business brokerage to discuss the process of selling and ask how they go about screening inquiries.

How to Build Your Business to Semi-Retire Quicker in 8-12 Months!

Are You Building Your Business To Give You True Freedom?

I speak with so many people after having started an Internet marketing business, network marketing business or whatever online business opportunity they’re using as a vehicle to earn money online, who’ve unknowingly built it so that they are shackled to what amounts to a hamster wheel long term.

As a result, no self-respecting person would apply to join what several called “the management cult” because the company structure positioned success and advancement to be a threat to their personal lives. I’ve said it before and I’ll quote Covey again, when it comes to our business we must “begin with the end in mind”. You have to ask yourself, if I achieve even a respectable level of success, will I be more enslaved by the business model I’m currently in or less? Pardon my direct tone my friends, but if you’re not building your business to at least have the choice to semi-retire in 8-12 months then you’re foundational business plan is terribly flawed. It’s not necessarily your fault however, you’ll be forced to live with the consequences unless your course is altered. The Reasons Why So the next natural question is why. There are many scenarios however most can be traced back to one of these three:

Started the business with wild unrealistic long term goals but without short term action steps and proper training.
Found a business opportunity designed to keep you on the hamsters wheel that got you excited and passionate about potential financial freedom. You’ve run incredibly hard with it and never looked up.
You know you’re on the right track but you’ve never learned the strategies behind building your business so that you could truly walk away while it still earned you revenue, returning periodically when you choose to tweak it.

So What Do You Do? If you are building an affiliate or Internet marketing company then you have full freedom here to incorporate changes and I’ll get to you in a second. If you’re involved in a business opportunity or a network marketing company you must first examine the compensation and advancement structure. Is it a realistic one or a carrot meant to bait you? Second look at the culture. With many business opportunities you have the flexibility to practically run your business the way you want within that structure. If the company is sound and you have an attachment to the product line or offering, it is often difficult to just pick up and walk away from an emotional standpoint. So in either case if you are building your own business or building a business opportunity, here are your choices:

Scrap it all together, take what you’ve learned and start from scratch with a new foundation
Remain but with a different philosophy and try to change it from within
Remain but learn to build a complimentary “Plan B Venture” with the right foundation.

But How Do I Build My Business To Semi-Retire? As I always preach, you first must be passionate about what you do. The second however is that you have to be building the business so that you control it as it grows or it will control you and destroy all the reasons you first pursued the venture in the first place. You see, if you’re not starting your business to at least have the choice to semi-retire within a year then why are you doing it? So how do you structure and build your business to semi-retire? Ah! That is the real question isn’t it. It’s actually pretty easy and I teach it to all those that are part of the “free coaching for life” that I’m offering on my crusade to teach 1000 people how to earn 6-figures this year which is getting some phenomenal results.

I know those whom I’ve coached that are “work-aholics” but build a business with this foundation every 6-10 months and then travels for several weeks before coming back and doing it again. The point is, that they have the freedom to do that because they’ve built it that way. When I work with you I’ll show you how your online business can do this as well by utilizing several strategies in which to structure your business for it to provide that for you. If you sign up to jump start your business by the “Success-Step” training system, I’ll teach you how to structure your business to achieve the future you really want. You deserve to live a fulfilled life which is why you decided to start your online business in the first place. Now take the next step and create it to reward you with the future you deserve.

Reason We Get Overwhelmed When Writing Our Business Plan

Recently, a client-call her Jane- came in to discuss her lack of progress developing her business plan for her coaching business. She was struggling to put words down on her plan because she wasn’t able to focus on the task at hand-completing her business plan and launching her business with a strategy in place. She found herself overwhelmed by the business planning process.

Jane was making little progress because every time she sat down to write, her mind would wander to certain questions like:

• Do I have enough training to be an expert on the matter?
• How will I use social media to market my business?
• Do I want to risk my savings?
• What kind of coaching business should I have?
• When should I start blogging or writing articles to build a following?
• Do I develop a blog/website?
• Who’s my customer?
• Who’s my competition?
• How is my life going to be different if I open this business?
• How will I make money?

Business planning tends to overwhelm a large percentage of those writing. Truth be told, it’s not easy to move from business conception to business launch. Jane’s case is typical of those who spin their wheels and never get past a rough business plan outline.

An aspiring Solopreneur will be flooded with questions to answer and choices to make when they are designing their business. These questions are difficult to answer because by answering one question, it has implications that effect another question. These questions come in waves. There seems to be little one can do to slow the torrent of inter-connected questions that appear to be needed to be answered simultaneously. Like any decision you make with many variables, you must consider the “moving parts.”

I used to watch the Simpsons in the 90s and recall Homer Simpson sitting at his desk in the Springfield Nuclear Plant. Homer’s responsible for managing some sort of equilibrium so that the nuclear facility doesn’t blow up. How does he do it? In the cartoon’s wry sense of humor, it’s as easy as moving a few levers up and down.

If radiation goes up, Homer will need to pull lever A down. But, when Homer pulls lever A down, the heat will rise. To lower the temperature, Homer needs to push lever B up. But, in doing so, the radiation goes back up and the pressure will build. You get the picture: all the elements in the factory are inter-connected. By taking course on one factor, another factor of your business will be affected, making it hard to move forward. You will to be in a constant state of uncertainty and tweaking that never leads anywhere.

By the end of your business plan, you’ll understand how the parts of your plan are connected. But between Feasibility and the end, blinders should be put on as if you are working in a vacuum. So, if we go back to Jane’s questions that arose at once, I would tell Jane that she’s going to know these answers eventually, but don’t try to answer all of them in the beginning.

This is the big source of frustration when writing a business plan. Because all the parts (competition, company resources, marketing, business model, work-life balance) are tangled, many people writing become overwhelmed trying to push the metaphorical levers up and down, trying to brainstorm, research, interconnect concepts, and complete business plan sections all at once.

A course of action that exacerbated Jane’s frustration was her skipping Feasibility, which consists of basic questions about her business and personal goals. Instead of working through Feasibility, and then building upon it through a structured process, she filled in a business plan template with “answers to questions”. Without having a purpose of the business (and her life), she was starting the process without any sense of direction. It’s like designing a house with no idea who is going to live in it or where the house is located. The lack of context and direction will lead to disaster.

Jane-a registered nurse-described how she envisioned the business planning process would be when she started the course. “In nursing, we ask the patient a few questions then put the symptoms in a computer. The computer analyzes the symptoms and then spits out a diagnosis. I don’t have to think that much. I thought writing a business plan would be like this, where you show us where to fill in some information and then the business plan would come together.”

I wish it were that easy!

Business plan writing-as you probably have figured out-isn’t like a computer program that spits out the answer. You don’t go through a series of steps to arrive at a magic formula that will make you a happy millionaire. The interconnections between the moving parts require you to think and make decisions throughout the whole process.

The system I teach my students-a system that this student had not followed-is based upon answering questions at certain times in the business plan process and staying disciplined to the system. This will discourage you from trying to answer all of them at once (by moving levers up and down to solve everything simultaneously).