5 FAQs About Buying or Selling a Business

Q: Why when I call a broker about a business I’ve seen listed on the internet, they give me the runaround instead of just sending me the information?

A: In a word, confidentiality. A Business can be damaged if the general public knows it’s for sale. Employees become squirrelly, customers skittish, priority with vendors can be lost, and competition may take unfair advantage.

Q: My business is stable, but it’s not longer challenging. Friends have suggested I should sell before it starts to decline. Your thoughts?

A: Perhaps selling now makes since. Business can decline, and decline fast, once an owner losses interest. However, there are other options. Perhaps you should acquire a similar business and grow through expansion. This could certainly add “challenge” back and perhaps increase the bottom line on both businesses. You might contact our Business Advisory Division to explore this and other options with you.

Q: When is the best time to sell my business?

A: When you’re ready. Complex question. Simple answer. I think the question was implying personal issues aside. Even so, same answer. If you have a crystal ball that can predict the direction of; the economy, government regulation, interest rates, competition, your health, employee’s loyalty, business cycles, industry cycles, and the like… Go ahead and sell your business. Now! Make a fortune in the ‘forecasting business’, or on Wall Street.

Q: I have a large down payment, but just a modest income. Will I be able to get financing to buy a business?

A: Unlike housing where your income helps determine how much a bank will lend, when buying a business, it is the income of the business that determines how much the bank will lend. Sounds like you are a good candidate to be looking for a business. Good chance you will increase your income too!

Q: I understand why I have to pay for the equipment, furniture, and inventory of a business, but why would I pay more?

A: The assets of a business is just a collection of “stuff”, but an operating business is so much more. Name, trained staff, accounts, reputation, systems, etc., are often called “goodwill”. All together it produces the “business”, and the sum is greater than the parts.