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How To Know A Prospective Buyer Is Serious to Buy Your Business?

Selling a Business is a serious business, as a reason it is of utmost important to understand how serious the prospective buyer is when inquiring into a business opportunity for sale.

So, how does a seller find out if a buyer is serious or a time-waster?

Buyer

A Serious Buyer will- 

tickmarkKnow what he/she wants

A serious Buyer will know the type of business he/she wants to acquire. First off, it should match their skills and experience. The buyer will also have some realistic expectations on the location, the investment budget and the size of the company he/ she is looking to invest into.

tickmarkNot waste time

A serious Buyer targets businesses, does research on the business, and is ready to make contact, set up appointments and visit these companies. They meet with potential financial partners. They discuss with the seller or broker important considerations. They focus on businesses that are suitable for their background.

tickmarkBe “Transparent” to the seller

A serious Buyer is always ready to disclose his/ her identity (profile and background) to the seller. The buyer needs to reveal his interests and the reasons why he/ she wants to get into this business. The buyer should emphasize his/her understanding of the industry and  the qualification they have to operate a similar business. This will build an initial trust as the transaction proceeds to advanced stages.

tickmarkHave resources available to buy a business

A serious Buyer will have sorted the financing to fund the purchase of the business. A ready proof such as an income statement, banking references, and borrowing capacity should be in place. A serious Buyer will have a substantial amount to pay for the down payment and should disclose the plan on how will the deal be financed. Funds from investors or partners should be formally committed.

tickmarkBe ready to sign a non-disclosure or confidentiality agreement.

Signing an NDA speeds up the process as the buyer can get the information required to make a decision about buying the business. And gives the seller the trust and confidence that the information shared will not be leaked out.

For a Buyer, who wants to be taken seriously, be prepared before beginning the search for businesses for sale. Business brokers and sellers can easily spot whether you are a “time waster” or a “serious buyer”.

For a Seller, asking some basic questions to qualify a buyer is important – at times this can be a provocative issue as some buyers get offended that they are being pre-screening but this process ensures that you are dealing with a qualified inquiry and a serious buyer. Serious buyers will appreciate this approach by seller though.

My two cents – continue running your business and don’t get obsessed with couple of enquiries even if they are at advanced stage. One thing you don’t want is to lose focus on your business and the business starts to run down.

So, stay focused on running your business till the deal is closed and keep your options till you get the money in the bank.

Post Source : http://www.indiabizforsale.com/blog

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How to Value an E-Commerce Business for Sale?

You may have a trendy website or a not so user-friendly website. You may have other business requiring priority so not able to give earnest attention to your website. Perhaps you have increased competition for your e-commerce business or you just want to cash it out and invest that money into something else. While you have your own reasons to sell out your e-commerce business, you still want the best price from the buyer. But let’s face it! Determining the value of an online business for sale is not easy because of its intangible nature.

How much is your e-commerce business worth? It is certainly not determined by the number of hours you have put in or the SEO and promotion you have done or the growth potential it has. Buyers of an e-business are interested in the profit that a website generates. The other activities are ultimately focused on increasing the profits and hence do not increase the value of your e-business. Continue reading

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Seven ways to sell a Manufacturing Business

Business owners invest a lot of time, energy and money in a business to make it a grand success. However, at times situations come when owners put the Manufacturing Business for Sale. It is a gigantic task that needs a lot of efforts.

Tips to sell a manufacturing business profitably;

1.  Find companies who are interested in consolidation: Consolidation offers the best way of expanding market size. For middle-market companies, it is a great chance for selling themselves.  For large companies, it is much easier to consolidate with small manufacturers rather than spending huge money in setting-up fresh units.

2.  Lower the potential risk and boost the asset value: Once you decide to close down the unit, prepare the Business for Sale by increasing the asset value. By redeploying sale of goods, revamping the budgets, and tracking inventory you can achieve good control over the situation. Continue reading

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Things to Consider When Buying an Existing Restaurant Business for Sale

Buying a business can be difficult; the buyer needs to consider innumerable factors that decide if the business is worth buying or not. But when you try to buy a restaurant business, the decision is much simpler. The food industry is one of those industries that will never go out of business and will always have a dedicated customer base. That solves the most important issue of a business selling-buying scenario – loss of customers.

Take for instance – Chami’s Restaurant and Caterers, it’s a small but well-established restaurant. This business was established about 3 years ago and provides home cooked style food to its customers. The restaurant currently attracts about 40 dine-in customers in addition to 20-25 customers daily who order tiffin. With a dedicated customer base of these many customers, the business makes a turnover of more than Rs.2.25 lacs per month. When this business is sold, the new owner inherits the customers, staff and equipment and will also have the turnover right from the start. Buying a business doesn’t get simpler than this. Continue reading

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Buying may be better than starting from scratch

So you want to own your own business.

Notice I didn’t say start your own business. The popular idea of going into business usually conjures an image of an entrepreneur or two starting at their kitchen table, growing their small business from the ground up.

But you can go into business another way: You can buy an existing business.

Too few entrepreneurs consider the option of buying a business. When you buy on ongoing concern, you’re further down from the starting line and you have several other advantages:

1. Existing customer base. This is the No. 1 reason to buy an existing small business.

But you need to make sure these customers will be a source of recurring revenue.

In some types of businesses, a hair salon or a doctor’s practice, for instance, customers or patients are likely to try you at least once. But you have to assume they’re also asking their friends for recommendations. Continue reading

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Selling Your Own Business, A New Approach

Until maybe just a few years ago, selling your business was considered a taboo. Traditions defined that the son must follow the footsteps of his father, and join the family business. But with changing trends in the mentality of people, the business environment, and the constant need to create something bigger and better, the stigma is vanishing quickly, and selling business is no longer looked down upon.

Being new to the idea of business selling, sellers often make some basic mistakes, forcing them to sell the business at a lot less than what it is worth, or in worst cases, shut it down without getting any return on investment. Traditionally sellers will try with their own contacts (limited reach and confidentiality issues) and talk to people that they want to sell their business. This often provides limited reach and also it creates situation where the word soon gets out that business is for sale, and it can greatly decrease employee morale, and might provide advantages to competitors to bash the seller company, and gravely affects the future scope too. Continue reading

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Exit Strategies for SME’s in India

Every now and then, several SME’s have been thinking on the exit strategy from their business. The most common exit plan for SME’s is the out-and-out sale of the business.

There could be various reasons for which the owner decides to sell the business. Irrespective of the reasons [why's] or motivations, the business owner should be confident that the real object is met – the business is sold.

Today we have a guest article by Priya Bhagat; Co-founder of Indiabizforsale. Indiabizforsale is an online platform for Business buying, selling, Business valuation and leasing. Before starting Indiabizforsale, Priya had a successful career in UK and India working for companies like Suez groupNestor healthcareBilldesk.com in various capacities in finance. Also, she has gained masters in international finance from Middlesex University & masters in commerce from Mumbai University. Continue reading