Whether you are considering selling your business now or sometime in the future, the most important thing you can do to ensure a successful and profitable sale is to take steps to properly prepare your business for the sale.  There are hundreds of reasons why a company is difficult to sell or offers are not as expected, most of which can be attributed to a lack of planning.

Selling a business is like selling a house.  The better and more salable you make it look, the faster it sells and at a more favorable price.  Whatever your reason for selling, I strongly suggest that you start preparing your business two years before your desired time of sale.  All too often, owners come to us wanting to sell their business “yesterday,” yet they have done nothing to position themselves or the company for a sale. Recently, a company failed to sell because the lease had less than one year remaining and the building’s owner would not renew the lease.  The buyer would have incurred several hundred thousand dollars to move the operation, which made the sale unattractive. There was also an owner who made every decision himself and did not want to remain with the company one day after the sale.  A new owner would be lost for months without assistance from a key employee or secondary manager.

Pre-sale planning
The goal of pre-sale positioning is to deal with any negative aspects that might hinder or prevent a sale, as well as to show the business in its best light.While each situation is unique and there are often many solutions to any one situation, following are some of the major issues an owner must deal with in positioning the business for sale. (Note: A negative situation for one company may be a positive situation for another.)

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Finding a medical clinic for sale and buying one can be a complicated process.  There are many steps involved in changing over ownership of medical clinics, urgent care clinics and health care clinics.  These types of clinics for sale are good investments but require careful planning and being resourceful.

Client Base
When you find medical clinics for sale, visit them several times during the week for a couple months.  Determine what types of clients are visiting the clinic on a regular basis.  For example, is the clinic primarily visited by new patient or established patients?  This will help you create a solid business plan.

Specialty
If you can find medical clinics for sale that offer specialty services, these often do better than general clinics.  General clinics will have a large number of clients but often these are not established patients.  Established patients will continue to use the facility for their needs and health care.  For example, a medical clinic that specializes in eye care will have patients returning annually for eye exams and others returning for new glasses, contacts and other optical needs.

Duration of the Clinic
How long has the health care clinic that is for sale been in business?  Is there advertising and a promotion plan already set forth for the clinic that you can join or follow?  Often, a medical clinic that has been operating for a long time will have a large number of established patients that will return over and over to the facility for their health care.

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The financial industry got caught with its pants down.   The automotive industry got caught with its arrogance up.

The PC, CE, communications industry simply got caught between the two.

We feel the angst but the business is still fundamentally sound.  With the right course adjustments the industry will be in a better position to deliver solutions and satisfaction to global business and local consumers.

We aren’t polyannic about the state of the economy…or the industry. 

We don’t quite believe as President Reagan did in the mid ‘80’s that things are good and they’re getting better.

But fundamentally, the content industry did not have the sudden stop the financial and auto industries did starting six months ago. 

We’ve been in this industry for 20 plus (ok + +) years and we’ve been through the downturns.  But the industry always comes out the other side better, stronger, more aggressive.

Silicon Valley is both a specific location and a state of mind. 

The winners are not those who focus their attention on making millions for themselves (if they’re really lucky that’s a nice side effect). 

They aren’t those who cling to the rustbelt past.

They are the individuals who drive change – often very disruptive change – for the people who live on this orb and the planet itself!

At the recent 6Sight conference dinner our conversation naturally turned to the economy and one young lady noted her company had recently been acquired and that she wasn’t certain about her job but she noted…“that’s the way the Valley is.”

           
That Hurts

We’ve all seen our 401K shrink like a bad case of hemorrhoids. 

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Achieving Extraordinary Results: it’s just a Skill

Some tweaks for getting your GPS (Goals, Plans & Steps) System running like a finely tuned sports car.

1. Remember that a Goal is “a written detailed objective to be achieved by a specific point in time.  And, it is something that you want, believe in, can commit to and will focus on.
2. If world class athletes have been taught and are using Visualization so can we. Visualize yourself having achieved that Goal.  Visualize what it will feel like, look like. Visualize/Focus on everything that makes it an important Goal
3. Know that you will act on your most dominant thoughts, so think only about what you want.  Remember the story about the baseball manager who told his pitcher, “Don’t throw a high inside fast ball.”  That was the dominant thought, he threw it, and they lost the World Series.
4. Focus only on things that you can affect.  Don’t waste one minute of your valuable time worrying about things you can not affect. Stop listening to the news and so much TV watching!
5. A Plan is simply the route you will take to achieve your Goal.  It should only be a couple sentences long at most.
6. NO MULTI-TASKING, it only assures that you will do several things poorly. Give each Goal 100% of the time you devote to it.

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Achieving Extraordinary Results: It’s Just a Skill

“Give me someone who does – over someone who plans any day.”  That is what a sales manager told me one day. 

I knew exactly what he meant because some of the most highly educated people I know have had very little success in life.  While some of the least educated people I know have had tremendous success. 

The reason is remarkably simple.  The successful people in every walk of life Do things.  The unsuccessful people plan and have intentions but seldom Do!. 

Now this may sound pretty simple, but it is true in my experience and in yours to.

Think about it in regards to prospecting.  If you sit around and plan to make prospecting calls, but don’t prospect, how many prospects will you generate?  None.  How many exciting selling situations will you walk into – none!  You will never develop your prospecting skills since you never use them.

If, on the other hand, you go out and start prospecting 3 times a day every other day lots of fun things will happen, most of which you can not possibly predict.  This is one of the exciting things about field prospecting.

For example, we called on a company in Youngstown, Ohio recently and as we walked into the lobby, we were greeted by a man putting on his sport coat and walking out.  We recited our blitz call words and he said he was the owner and wanted to talk with us right then since they had just gotten a new contract with the Navy and were in the process of seeking bids for materials.  No way to predict or plan for that!

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If you’ve been paying any sort of attention to the news this week, you’ll probably be aware that the Chancellor released his pre-budget report on Monday. This report is likely to have a major impact on your business, whether or not you are VAT registered. 

I’ve outlined the main points below:

VAT From Monday 1st December, the VAT rate will go from 17.5% to 15% for at least a year. If you are VAT registered, you will need to use the new rate as of this date. HMRC have issued detailed guidance on this.

The new calculation for working out VAT is now 3/23.

CORPORATION TAX The Government is deferring for a year the planned increase to the small companies rate of corporation tax. The rate will remain at 21% for 2009-10.

EXTRA LENDING UK small businesses should also be able to benefit from around £4bn of lending from the European Investment Bank (EIB) between 2008 and 2011. Approximately £1bn of these funds should be available by the end of 2008. The Government will launch a new Small Business Finance Scheme to support up to £1bn of bank lending, together with another guarantee facility for up to £1bn of bank support to small exporters. It will also make available a £50m fund to convert businesses’ debt into equity.

TAX PAYMENTS Businesses in financial difficulty will be able to spread payment of their tax bills over an indefinite time period. A new Business Payment Support service has been launched to help businesses calculate over what period they need to spread their corporation tax, VAT, PAYE, income tax and national insurance contributions in order to remain profitable.

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Advertising and marketing is the industry you should get into if you want to make a lot of money very quickly because the advertising industry can actually make you your money back within a couple of years. We are all used to seeing advertisements for various products everywhere and the idea of extensively advertising brands buys into the consumer society we live in today. As a result, it is worth thinking about taking a slice of the pie and buy an advertising and marketing business.

In terms of the investment of time and money, the possible return is limitless. One advertising contract can generate millions in revenue so it is worth looking into the possibility of buying an advertising business for sale. However, there are factors that you need to examine before making an investment.

Your Advertising And Marketing Background
If you want to buy an advertising and marketing business then you first need to look at your own level of experience in business in general. Although it is not necessary for you to know anything about marketing and advertising when you buy an advertising and marketing business, it is essential that you have the business skills to be able to put the right people in place. There should be two separate departments in an advertising and marketing business – an advertising department to put together a selling campaign and a marketing department to establish the brand. Both have to have the top people in place so that the departments can establish themselves within the business and attract new customers.

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Did Harley Davidson create the desire for rebellion and the feeling of freedom that comes from conquering the open road?  Did Starbucks create the desire for a sense of sophistication or for people to feel like they are part of a community?

Of course not!  Harley Davidson and Starbucks simply found wonderfully resonant ways to tap into these deep emotional currents that course through people’s veins.  However, it is important to remember that everyone does not have the same emotional imperatives.  That is why some people buy a Suzuki bike and many people prefer to buy their coffee at Dunkin Donuts.  That is how great branding works – companies find ways to connect with the emotional drivers that move their specific target audience.

When you’re walking down the grocery store aisle, have you ever listened to the tiny voices in the back of your head that are asking questions like, what does this product say about me as a mother?  What does this product say about my status?  Do I prefer to be irreverent or traditional?  Am I frugal or do I prefer to be decadent?

These are all brand questions your semi-conscious or unconscious mind is asking at warp speed.  In fact, according to experts as much as 90% of brand decisions are made at an unconscious emotional level.

So what does this all mean for us as PR professionals?   It means that purchasing decisions are made based on the strength of the brands you represent.  And brands are not built solely on our industry’s traditional view of PR.  They are the sum of the stories and experiences that your core target audience has had with a brand.

This means our profession must become expert at how great brands are created and nurtured.  And we better start helping our clients build resonant brands from the ground up.  If we don’t, others will, and we will move even further from holding that coveted seat at the table.

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I love my children and I know they love me.  In fact they love me so much they’ve been sharing all their germs with me. This time I’ve lost my voice and have an ear infection.

This all came about during a recent trip out to LA to attend Ali Brown’s last ever Online Business Success Workshop. Not only did I come away with some amazing marketing advice I also made some pretty big shifts with my own business which it seems is helping me get unstuck.

Have you ever reached that point where you know you should be moving ahead much more quickly than you are?

You feel like you are racing ahead but with the parking brake on.

Well, that’s how I’ve been feeling.  And being at the conference really opened my eyes to the possibilities for the next phase of my business.  But while my eyes have been opened, my throat and right ear have been closed.

It was half way through the conference that I got sick and lost my voice.  Everyone said it was a sign from the Universe.  I guess the Universe saw that I wasn’t responding to the quiet nudging and soft taps at my door so it needed to do something to shut me up and get my attention.

Ok, I’m listening.

Without my voice I have become aware of some interesting things.

1. People model our behavior.

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Have you ever had the experience of having to promote someone else’s products and services? I don’t know about you, but I always find this much easier than promoting my own business. May be it’s because we’re not as close to someone else’s business as we are to our own and so if people say no it’s not such a big deal.

Problem is, if you’re in business, you’ll need to market and promote your products and services and for this to be effective, you’ll need to get over the fact that you’ll have to talk about yourself in a positive light.

Easier said than done though, isn’t it?

I think we can all trace this problem back to childhood. We were all brought up by being told that being modest is the way forward. Talking about yourself too much is a bad thing – you should pay attention to other people instead. 

Great advice…but, not so helpful when you’re trying to sell your business.

So, let’s explore some ways in which you can overcome this:

1. If you’re not comfortable talking about yourself and would prefer to listen to other people, that’s actually a great selling skill. Ask people questions, encourage them to tell you their problems. Chances are that they’ll tell you exactly how you can help them and then it’s much easier to tell them what the solution is.
2. Write down some frequently asked questions. If you keep getting asked the same questions over and over again and you’re not sure what the answers should be, write them down with your ideal answer. Then you can do two things with this. You could put your FAQs onto your website so that potential clients can see them and you could also practice them so that the next time someone asks you a question, you’re ready with an answer.
3. Act.

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Buying a business is a huge step for any individual, whether he or she has bought businesses before or not. It is not as risky as setting up a new business because the name, product or service has already been established. In fact, buying a business can actually work well for someone looking to invest and take a step towards entrepreneurship.

Of course, much depends on why the business is being sold but if you do buy the right one then you could find yourself with a successful company on your hands, especially if you buy an undervalued business. This is a business that is currently making a profit but not necessarily doing as well as it should. There may be many reasons for this, which will be evident shortly, but that should not necessarily put you off purchasing the business.

Saving money by buying an undervalued business can give you a financial boost initially but much depends on why the business is undervalued as to how much of a bargain you are buying. The tips below will help you to put your mind at rest though by reassuring you that you are buying the right business.

The Buying Tips You Need To Know

1. Shortlist undervalued businesses – When looking to buy an undervalued business, never settle for the first one you come across. That is effectively rushing into the purchase. Shortlist several that you may be interested in buying and are relevant to your skill set.

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A trademark search can, in actuality, be many different things. In theory, a trademark search is performed to determine whether or not the mark you are hoping to use is already taken by another. This allows an individual to apply with a greater level of confidence for the use of a trademark with the United States Patent and Trademark Office (herein referred to as the USPTO). A trademark search is, ideally, a comprehensive, analytical way of researching a name, slogan or logo for prior use.

A trademark search can also be performed in a sloppy and ineffective manner, and may not protect you from potentially infringing upon another’s name or logo. This is why it’s important to ensure that the trademark research you have commissioned is done comprehensively and thoroughly!

It is not unusual for a trademark research company to charge hundreds of dollars for searching the USPTO, which you can do for free. Comprehensive research firms search Federal, State and Common Law records, which is a more logical and thorough way to research your name. When commissioning research on your name, it is important to ask the company you’re considering using to clarify what exactly their searches entail, each step of the way.

Companies may try and save money in other ways, including letting you pour through the raw data they collect without any summary of what it all means. It is important to be sure once you’ve decided to commission research on your name, that the information is compiled into an easily readable report. Examining the results of your research can sometimes be difficult, even when placed in an edited report. If you’re left to decipher the meaning of a company’s raw data, chances are you may under react or overreact to the results.

When searching your name, it is important that phonetic spellings of the name are searched, as well as vowel variations.

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At one point or another, we’ve all seen a product or business name with a small, encircled R floating next to it. You’ve probably wondered what this R symbol really means, and how exactly it got there in the first place. Most people will tell you that it means something to the effect of “registered,” but that’s only a small part of the significance behind the circled R.

It’s correct that this symbol does imply the term registered, but registered with whom, and how?

A “registered trademark”, or ®, refers to a name, slogan or logo that has been officially registered with the United States Patent and Trademark Office (USPTO). Registering a trademark is beneficial to a business because it publicly states that your trademark is registered with the USPTO and therefore, you have exclusive rights to that name within your industry. This means that if your business had a registered trademark, and you found another business of a similar nature utilizing your name or logo, you would *likely have the legal right to use your name!

Each time an individual applies for a trademark, the USPTO performs a cross reference check of their name and/or design for similarities among Federally registered or pending trademarks ONLY. The USPTO search is lacking in State trademark AND US National Common-Law databases. Because the USPTO protects names in this fashion, you do not run the risk of another business utilizing and possibly soiling the reputation of the company that you worked hard to build!

Once you have applied for your trademark, the USPTO will consider it a pending mark for up to 18 months. This is among the many reasons why it is important to apply for your trademark sooner versus later. The sooner you apply, the sooner it is that you will be doing business under a registered, protected name!

*This is dependent on if the name is truly available at the time of filing.

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Challenging times call for innovative thinking and problem solving.  I was interested to read in a section of the Wall Street Journal that Dominos Pizza is considering making loans available to its franchisees. This will allow franchisees to gain access to capital and not suffer from the limiting affects of the credit crunch in the US economy.   “Domino’s Pizza Inc. discussed how its borrowing capacity has been hampered by Lehman Brothers Holdings Inc.’s bankruptcy filing.  With the credit crunch weighing heavily on the restaurant industry, Domino’s said it will save its cash and potentially make loans directly to its franchisees.”

In fact Domino’s is the only franchisor so far committed to offering some of its own money to cash-strapped potential franchisees, though Burger King Corp., Tim Hortons Inc. and Sonic Corp. also appear open to the idea of stepping in to help franchisees, according to industry experts.

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Business awards, as entering and winning (or even reaching finalist position) one of these is a great method of ensuring PR and many awarding bodies, such as the big banks out there, also do a great job of publicising their winners. The big thing that puts people off entering these awards is the work that goes into it, but it’s important to remember that once you’ve done the work once, a lot of it can be tweaked and tailored to individual awards. One might focus on creativity, another on staff training, but much of the content will be the same. So, here are my top ten suggestions to give you the best chance of getting noticed by the judges.

1. Make the decision to do it.
If you are bringing entering awards into your PR programme then really do go for it. Just half-heartedly entering one award is a waste of your time. Do a little bit of research and see how many you are actually applicable for. Here are just a few I found in a 30 second web search – many of the banks annually run their own awards, as well as women’s magazines and the women’s website Handbag.

http://www.nationalbusinessawards.co.uk/nbaenterawards/
http://www.businessawardseurope.com/html/enter-awards.html
http://www.nationaltrainingawards.com/entering/index.htm
http://www.enterprisenation.com/detail/Entries_now_open_for_2008_Home_Business_Awards/2001/1.aspx

Likewise, give yourself the resources you need to do the job. Get outside help if you need it, as this is a big investment in your future.

2.

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You need to put yourself in the position of the potential buyers when answering this question.  Try asking what might influence you if the roles were reversed.  Why would you buy your company?  What might excite you to buy your company if you didn’t already own it?  This is an important part of the sale process because a seller must present the product, your company in this case, so that prospective buyers can understand what is special and what benefits they might gain by buying your product.

Some of the more common things that drive the buying decision are:

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I have summarised below the process that we use when acting as broker working for the buy side.  Although, the following assumes you will use a broker, you could consider following this process yourself, but I would warn you of two key things:
 
• Do not underestimate the time and effort absorbed by the buying process and recognise that it will divert you from running your own business with potentially damaging results.
• The process of negotiation involved in buying a business can get emotional and personal, risking damage to the relationship with the seller who will become your new partner or employee.

The main steps in the process are:

• Decide what you want to buy and why – Of these, why is the most important and it will feed into deciding what you will look for as targets.  What do you expect the purchase to do for you?  What will the purchase do that you cannot do without it? When considering the cost of the acquisition, you must also understand what else you could do with the money and then compare the returns that you will get from the different investment strategies always considering the risk profiles of each. 
• Finding targets -  The first stage helps you create a profile of the ideal target; business sector and location, customer base, offerings that serve a defined gap in your own armoury, revenue and profit ranges, private or public status, etc. Using the profile, identify potential targets that might match it.  Brokers do this through a combination of their existing network of contacts, recommenders and introducers, and specific searches using publicly available information.  They will also use additional sources of information such as memberships of trade associations, or attendees at appropriate trade fairs.

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Some readers will be asking; why use a broker, why pay these fees when I could do it myself?  The answer is quite simple, the business of selling a company is involved and time consuming which could easily lead you to neglect your business while trying to sell it.  Such neglect could create problems, reducing the value of the business by more than that saved in not paying fees to a professional broker.

Example benefits from using a professional broker are; the necessary knowledge to conduct a thorough sales campaign, experience and objectivity to avoid damaging conflict, and negotiation skills directly relevant to getting you the best possible deal.

So if you decide to use a broker, here are some thoughts that will help you to select and then engage successfully:

1. Before talking to any brokers have a reasonably clear idea of what you want to achieve by selling your business; your ideas on valuation, deal structure e.g.

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Many of the things that need to be considered when deciding to buy a business apply to any purchasing decision.  It is all about striking a sensible balance between risk and reward.  Consider a situation where you go into a store and buy something for $5, you get it home and find that it does not quite match your expectations.  You could take it back and get a refund or an exchange or you might just put it down to experience and write-off the $5.  After all, most people squander at least $5 on every tank of gas by the way they drive and waste similar amounts in other areas of their lives without even knowing it. 

So, you are now considering buying a business.  You may well be raising funds from the bank, probably secured on your assets such as your home or your pension plan, you may borrow money from friends and relatives and you will put in as much money as you can from your own resources.  You are now definitely into a high risk activity.  If it does not work you cannot just write it off, move on and put it down to experience, it could change your life forever.

I have often heard it said that many successful business people have had one or more failures in their past before becoming successful and as Friedrich Nietzsche said “That which does not kill us makes us stronger.”  While I am sure this is true and it is a great line to quote while licking your wounds over some failure or disaster, would it not be better to avoid the mistakes and move straight to your success story?

When considering buying a business you really need to know why you are doing it and to help you need to think about a few key things:

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When selling anything, it is important to focus more on the motivations of the buyer than those of you the seller.  When selling your business you need to imagine what potential buyers might want to gain from an acquisition and make sure you give them what they want.  We investigate this further in another article entitled “Selling a Business; What Influences Your Prospect’s Decision to Buy?” and this is a part of what helps in maximising your profit gained from selling you business.

One of the key features of an M&A deal is the valuation process.  One of the most common approaches is to offer a price based on a multiple of one of the key financial facts such as revenue, earnings before interest and tax (EBIT) or earnings before interest, tax, depreciation and amortizations (EBITDA).
 
Valuations based on revenue are not generally popular as revenue is only a measure of volume of business rather than the quality of the business as demonstrated by the earnings.  You do of course have influence over the amount of earnings and this should be a key focus when preparing your company for sale, so here we will focus on earnings based valuations.

Whatever industry you are involved in, there will be accepted norms, which may change over time, relating to the valuation multiples that will be used by prospective buyers.  For example, a company in the IT sector which owns its own products could receive offers of 7-10 times earnings.  A similar company without products but providing a people based service will attract a lower valuation of say 4-6 times earnings. 

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