Ready to Sell? 3 Steps to Prepare

You’ve spent years building your company, but the day has come. It’s time to sell your business. Whether you’re planning to retire, move to a different industry, or reinvest in a new company, selling your current business can be challenging.

It’s important to find a buyer who is ready and willing to do right by your customers, employees, and suppliers. However, there are also likely hard changes to be made. How can you prepare your company for sale and get the right buyer?

Here are three steps to help you prepare to sell your business:

1. Build Your Revenue

A buyer will look closely at how your business is trending. A growing business is more desirable and will command a higher price than a stagnating or downward-trending company.

Consider creating a new sales initiative for your employees or bumping up your sales staff. Also, make sure that every dollar of income and expenses is recorded accurately in your financial records.

When you have a growing business with impeccable records, your company will become much more attractive to buyers.

2. Reduce Your Influence in the Company

This may be one of the hardest, but most important, ways to prepare for a business sale. You need to reduce your role in the business so that your management team can step forward. If you haven’t created a strong management group, this is a great time to do so.

Selling the business naturally means that you won’t be there to call the shots. Someone else will be taking over. The more you’ve stepped back and let others lead, the easier the transition.

Employees, customers, and suppliers need a go-to contact that isn’t you. Set these reporting structures up now so that when you sell, the process will be seamless.

3. Turn Excess Inventory and Assets to Cash

It’s easy for a company to sit on old inventory well after it should have sold. If you’ve been leading the business for a number of years, there may be a lot of excess inventory in storage.

Generally, a new buyer isn’t going to be interested in paying for old stock, so now is the time to liquidate it and turn it into cash for your company. Get your inventory down to the level it needs to be for normal business operation before you sell.

The same principle applies to business assets. If you have old equipment you’re not using anymore or other assets that are gathering dust, it’s time to sell them. If they don’t have retail value, sell them for scrap or parts or dispose of them.

Just the Beginning

These three steps are essential, but there’s more you need to know. There are actually nine steps we recommend to prepare your business for sale. Get the guide for free now!

Once you’re ready to sell, you need the right brokerage to partner with you and help you find a qualified buyer. Don’t waste your time with people who are just practicing their valuations or “kicking the tires.”

When you work with Murphy Business, we can connect you with serious, highly-qualified buyers who are ready to take action on your company. Ready to get started? Contact us today!

How to Create an Exit Strategy From the Start

You’re just starting your business. You have a deep passion to serve your customers and provide the very best products and services available. Thinking about how you’re going to exit the business is likely the last thing on your mind.

Unfortunately, failing to plan for the end means that you aren’t sure where you’re going. Yes, your business can grow and develop, and an exit plan might materialize. It’s a much better idea to plan for your exit from the beginning.

Best of all, with an exit plan, you’ll have an easier time winning over investors. They love a business plan that shows them how they’ll get their return on investment.

Possible Exit Strategies

What are the possible ways you can exit your business? There are several.

If you’re a sole proprietor without investors, you can simply increase your personal income from the business in the final years. At the end, close the business, liquidate, and retire or move to your next venture.

Other companies might plan on growing to the point that they can go public. Once your business is publicly traded, you can sell your shares when you’re ready to retire. Your management and employees will choose a new leader and move forward.

Or you might decide you want to sell the company to another entrepreneur or a larger firm. To do this, you need to be aware of who needs your technology or products and cultivate a relationship with them as early as possible.

No matter how you plan to finish your involvement with your company, whether it’s in three years or twenty, you need to plan for it now.

 

Step 1: Design the Business to Run Without You

The biggest mistake business founders make is centering the business on themselves personally. It’s easy to do — after all, you have the passion and the vision, and in the early days, you might have the most expertise as well.

As your company progresses, you may want to bring in a CEO. You might be tempted to be the CEO yourself, but this can hamstring your company. Independent leadership helps you grow in new ways and gives your company an independent leg to stand on.

You should also build work teams and ensure that you aren’t the primary face that the customer sees. That way, when it’s time for you to exit, the company will continue to run smoothly.

Step 2: Keep Your Finances in Order From the Beginning

When a business owner wants to sell their company, one of the biggest challenges can be getting the financials and documentation in order. You need detailed historical financials as well as projections for the future.

If you plan to sell as an exit strategy, develop a process for creating and storing these documents right away. It will make everything much easier when you’re ready to sell.

Step 3: Decide How Much to Say

You probably don’t want to publicly broadcast your exit plan as soon as you found your company. Customers and partners will have a hard time trusting you, and employees may not want to work for an owner who seems uncommitted.

Instead, plan for your eventual exit and put processes in place quietly.

Are You Ready to Sell Your Business?

If you’re ready to exit your business through a sale, we’re here to help. Murphy Business has helped many companies market themselves, qualify buyers, and negotiate the terms of a sale.

If it’s time to implement your exit plan and sell, contact us today for more information!

How to Be a Great Leader in Uncertain Times

Leading a business in 2020 has been extremely challenging. However, it seems like there are always difficult circumstances in business. From the attacks of 9/11 to the economic meltdown of 2008-10 to COVID-19, tough times surface periodically.

What separates those who do well from those who fail is often a single factor — great leadership.

How can you be a top leader in these uncertain times? Here are ideas you can use today — and in the next crisis.

Learn to Manage Well Remotely
Pandemic or not, remote work is a growing trend. Over the last five years, remote positions grew by 44%. Many top workers look for flexibility and the ability to work from home when they apply for jobs. Crises, such as disease or economic uncertainty, make remote work even more appealing to both companies and their staff.

Are you able to lead successfully from a distance? It requires excellent communication, the technology skills to use project management and video meeting tools, and the ability to engage people and help them feel successful.

Work on being very clear with employees about goals and expectations, along with project plans and timelines. The more you can do this, in person or remotely, the more practice you’ll have for future opportunities.
Also, the fact that every person manages their workload differently is magnified during remote work. Practice seeing that as a benefit, not a threat. Encourage people to work in a way that fits them best.

Communicate, Communicate, Communicate
When people can’t see your body language or hear your tone of voice, communication is challenging. Practice being especially clear in emails and using video meetings instead of in-person more often. You’ll learn a lot, and having the opportunity to follow up in person will help avoid misunderstandings while you’re growing.

Help your employees communicate with you more clearly as well. They should be able to define their goals in their own words, tell you how things are going, and give you a heads-up if a project is late.

This level of communication might seem overmuch under normal, in-office circumstances. However, if there’s another crisis or your company decides to make at-home work more available, the skills will be priceless.

Work Closely With Your Leadership Team
One of the things that everyone deeply needs during a difficult time is a sense of stability and routine. One person alone cannot provide that. Be sure you work closely with other leaders in your company to provide a united front and communicate the same message to everyone.

Inconsistency in leadership and messaging in tough times makes problems worse. If you’ve recently bought a business, it’s even more critical to get everyone on the same page. Strive for levelheadedness, empathy, and focused leadership.

Is it Time for a Change for You?
As a leader, you might be ready to take the next step — owning your own business. While this is a challenging economy, the truth is that you will always face obstacles. Don’t let that stop you from moving forward with your dreams!

If you’re ready to take the leap to own your own business, let us help you find exactly what you’re looking for. Contact us today to learn more!

Sell a Company with Murphy Business

At Murphy Business, we’re business sales specialists. If you’re looking to sell a company, you can partner with us to ensure you get the maximum value out of the final deal. Not only will you have access to our experience and expertise, but you’ll also benefit from our extensive connections. Combined, these factors provide you with the assistance you need during every step of the transaction, while also making it simple to sell a company with confidence.

How Our Experts Can Help You Sell a Company

Our business brokers have unique insight into the business market as many of them were once successful business owners themselves. This experience enables them to understand any concerns you’re facing and explain the options you have in a clear and accommodating manner. 

Our personal experience with business ownership and management lends itself well to facilitating business transactions that leave both buyers and sellers satisfied with the ultimate purchase agreement.

buying an established business

Valuation & Marketing

The sales process always begins with a business valuation. This procedure makes it possible to price your business in a fair and accurate manner, ensuring the final sale price reflects the true value of your business.

After we’ve determined how to price your business, we’ll design a plan to market it to potential buyers. We work with a wide range of strategies to promote our clients’ businesses, from advertising in trade publications to targeted marketing and direct mail campaigns. As part of your marketing plan, we’ll also create a comprehensive Offering Portfolio containing all the information buyers need to assess their interest in your business.

We go above and beyond for our clients by promoting their businesses through the national and international networks of our affiliates. This access enables word of your business to reach a more extensive pool of buyers and increases your chances of landing a deal that meets your expectations.

Negotiations & Agreement Finalization

Finding a buyer is just the beginning. Next comes the often complicated process of negotiating with the buyer and creating a deal structure. This can be a tenuous time for both buyers and sellers, as small misunderstandings or miscommunications can lead to the whole deal unraveling. Having a business broker act as a mediator helps prevent these issues from getting in the way of an agreement that is satisfactory to both parties.

You can rely on us to steadily negotiate on your behalf while keeping you in the loop on the terms of sale and ensuring you have the final say on all decisions. With our assistance, you can successfully sell a company while minimizing stress and maintaining perspective, focusing on your future at all times.

Understanding the Scope of Our Services

Our breadth of experience includes business transactions across a wide range of industries, from construction and transportation to lodging and retail. Take a look at just a few of the different types of businesses we currently have listed for sale:

    • Restaurants, cafes, and bakeries. From a cafe that’s been open for over four decades to an award-winning, European-style bakery to a casual Tex-Mex franchise with great visibility, we have a number of businesses for sale in the food service industry.
    • Construction and commercial contracting. An extremely profitable structural concrete contractor, a leading rigging and crane service, and a fabricator of exterior structures are just a few of the exciting companies available through our brokers.
    • Recreation and lodging. We look forward to connecting entrepreneurs with an amazing outdoor entertainment venue with potential for a vineyard. We also have a lakefront resort available for purchase, as well as a fun corporate event business. 

Sell a company with confidence by partnering with Murphy Business. Give us a call today at (888) 561-3243 to connect with a business broker in your local area. 

 

Common Questions Our Business Brokers Can Answer

If you’re a business owner who’s looking to sell your business, you are sure to have lots of questions about what to expect. When it comes to dealing with such a life-altering decision, it’s best to consult a professional business broker who can provide objective advice about taking the appropriate steps for your personal and professional goals.

At Murphy Business, we’re proud to be there for business owners when they need us most. You can count on our brokers to answer all of your questions before you make any tough decisions about selling your business. In addition, we’ll guide you every step of the way during the negotiation process.

Below, you can find some of the most frequently asked questions we receive from business owners. While every situation is different, we hope that this information can help clarify any concerns you have as you embark on the journey of selling your business.

How should I go about selecting a business broker?

When it comes to choosing a broker, interviews are the best way to assess whether or not a particular individual is going to be able to meet your needs. First and foremost, you’ll want to select a broker who is easy to communicate with. This quality is going to be very important throughout the process of selling your business. 

It’s also a good idea to choose a local business broker who has national connections. For example, at Murphy Business, our brokers are experts in their local markets but have extensive access and resources through our international organization. Finally, ensure any broker you work with is willing to provide referrals to professionals who can share their experience with you.

How do business brokers find buyers?

With Murphy Business, finding a serious buyer isn’t a struggle. That’s because we maintain a large network of buyers through our far-reaching organization. Our goal is to find a qualified buyer who shows genuine interest in your business, is prepared to pay market value, and is ready to move quickly toward the final sale. 

Some of the ways we go about doing this include, marketing listings in leading publications and searching via associated industries. Since we maintain national and international affiliations with business brokerage associations, we are able to reach a large pool of buyers and narrow down the interested parties to those who are the best fit for your business.

How long will it take to sell my business?

Every business sale is different, so it’s best to refrain from setting expectations regarding the length of time required to find a buyer and finalize a sale. That being said, the average transaction length is between 6 to 9 months, while more complex sales can take around a year.

There are a number of factors that go into this calculation, from the time it takes to determine the value of the business to the number of buyers available and obstacles associated with acquiring financing. Whether your journey is quick or a little more lengthy, you can rely on us to help you make sound decisions that you’ll be satisfied with well after the ink has dried.

What are the first steps of the selling process?

Selling a business isn’t as simple as posting a few pictures and a quick description online. There’s actually quite a bit of research that must be conducted in order to put your business on the market. First, you’ll need to evaluate your business operations and analyze your financial records. This ensures all of your ducks are in a row and clarifies the different strengths and weaknesses your business presents.  

Through a Business Valuation and Market Analysis, Murphy Business Associates will help you gather the documents needed to formulate an asking price and come up with a deal structure. Not only will we help prepare you for a successful sale, but we’ll also work to maximize your market potential.

To learn more about how one of our local business brokers can help you sell your business, call Murphy Business today at (888) 561-3243.

 

Everything You Need to Know to Buy a Company

It’s no small decision to buy a company. If you’re an entrepreneur who’s looking for a new opportunity but don’t want to start a business from scratch, purchasing an established business is the way to go. 

While this approach allows you to skip some of the more time-consuming and costly parts of getting a successful business up and running, you’ll still have to navigate the process of finding a business to purchase and negotiating a deal that leaves both you and the owner satisfied.

As this process can be complicated, it’s important to learn what to expect ahead of time so that you’ll know what potential obstacles to watch out for. Read on for our step-by-step guide.

Start by learning more about yourself.

Before diving into the classified ads to see what’s available in your area, take some time to think about why you want to buy a company. Ask yourself questions like:

  • What experience, passion, and skills are you hoping to leverage in this new endeavor? 
  • What industries excite you, and why? 
  • What business types are you most comfortable with based on your professional history? 

Only once you’ve answered these questions should you move on to looking at businesses for sale.

Get to the bottom of why a business is for sale.

Once you’ve found a business that you would be interested in purchasing, it’s necessary to take a hard look at why it’s for sale. Of course, it’s completely normal for a business to go up for sale because its owner wants to retire or make a career change. However, it’s prudent to assume that there might be another reason for the owner’s departure and that this reason could also influence your ability to run the business successfully.

Whether the business plan is not conceptually sound, the location is out of the way for customers, or the brand is suffering from image issues, it’s possible that a change of ownership wouldn’t improve the trajectory of the business. On the other hand, the owner may be struggling with challenges that you’re well-suited to overcome due to your past experience and personal strengths.

That’s why it’s important to speak with the owner at length about any concerns you have. You can also reach out to current customers, employees, and neighboring businesses to get a fuller picture of what’s going on.

Do your due diligence.

The above research is just the beginning. Once you’ve decided you’re serious about buying a company, you’ll need to gather even more information of a legal and financial nature. In order to ensure this process is completed thoroughly and accurately, it’s best to partner with professionals, including an accountant, a business attorney, and a business broker, if you aren’t already working with one.

From licenses and permits to organizational paperwork, business financials, and leases, these professionals will help you review a range of documents to ensure you’re making a solid decision by moving forward with the purchase.

Prepare for price negotiations.

Tread lightly at this stage, as many deals start to unravel when buyers and sellers can’t come to an agreement about the value of a business. A business broker can be especially helpful with these negotiations, mediating when tensions run high and providing access to reliable business valuation services to facilitate an objective understanding of the business’s value.

In addition to agreeing upon a final purchase price, you and the seller must settle the details of the final sales agreement – including tangible and intangible assets, intellectual property, and customer lists – before you can finally call the business yours.

Overwhelmed? Get Expert Help to Buy a Company with Confidence

This is only a brief overview of the general steps you’ll need to take to buy a company. In fact, the process can be quite lengthy and complicated. If you’re a first-time buyer, it’s likely that you’re going to make some mistakes along the way. That is unless you have someone more experienced by your side.

A professional business broker can assist with the purchase process from start to finish, helping you figure out what type of business best suits your goals, assessing potential options, and negotiating on your behalf to get the best price possible. Rather than worrying about every detail, you can focus on the big picture and maintain confidence as you make important decisions about the future.

Learn how one of our local business brokers can help you buy a company today. Call Murphy Business at (888) 561-3243 for details.

 

Business Broker? Your Questions Answered

If you’re in the market to buy or sell a business, you may have come across the term “business broker” in your research. While business brokers offer valuable services that make it easier for businesses to change hands, their purpose isn’t always well-known to individuals who haven’t participated in this kind of transaction before.

Below, we have answers to some of the most commonly asked questions about business brokers.

What is a business broker, exactly?

The role of a business broker is to act as a mediator between buyers and sellers of businesses. Rather than trying to negotiate the details of a complicated agreement themselves, these two parties can rely on a broker to be their go-between.

The broker increases the likelihood of a productive discussion, leading to a deal both individuals can be satisfied with. This can be a huge time saver in what is often a lengthy process, and can also minimize the stress and uncertainty surrounding the weighty decisions involved in buying and selling a business.

Why do you need a broker?

In addition to the above, brokers offer valuable services for both buyers and sellers. When it comes to purchasing a business, a broker can advise entrepreneurs about finding the right purchase for their budget, personal strengths, and expectations.

Since brokers have so much experience in the local business market, they are well-equipped to recognize when a deal is not in the buyer’s favor, helping the buyer avoid making a decision they would later regret.

For sellers, brokers make it easier to connect with serious buyers and can weed out individuals who express interest but lack the resources or know-how to run a particular type of business. Brokers can also assist with paperwork and administrative tasks that could otherwise be overwhelming for sellers to complete on their own.

How much does a broker cost, and are their services really worth it?

Brokerage fees tend to run between 5 and 10 percent of the selling price of a business. In most cases, especially for first-time buyers, the services of a broker represent money well spent. It helps to think of the broker’s commission as a kind of insurance.

Sellers will gain peace of mind that their business is being properly valued during negotiations, while buyers will have access to objective advice that can help them make decisions with confidence.

It’s important to get a complete understanding of what services your broker will offer and what their fees include as you get started.

What qualities should I look for in a broker?

In order to get the most out of your relationship with a broker, it’s important that you select one who has their pulse on the business market in your local community. This in-depth knowledge will come in handy for connecting buyers with sellers and correctly assessing the value of a business.

In addition, you’ll want to find a broker who you can easily communicate with. Since their role is to negotiate on your behalf, it’s crucial that you feel completely understood when discussing your priorities and goals with them. Likewise, as business negotiations can get complicated, they need to be able to communicate legal and financial details in a way that makes sense to you.

Where can I find a professional broker?

There are several resources you can check to find a broker in your local area. You can start with the “Business Opportunities” section of local and regional papers to see who is facilitating the sales of businesses in your community.

It’s also worth taking the time to ask previous and current business owners about their experience with trustworthy brokers. They’ll be able to give you their honest opinion of how a broker benefitted them during the buying and selling process. If you don’t have any business owners on your contact list, try checking with the local chamber of commerce or asking your CPA or attorney for referrals to brokers in your community.

Are you in search of a reliable business broker to assist you with buying or selling a business? Contact Murphy Business today at (888) 561-3243 to connect with a broker in your area.

Tips for Buying a Business

If you’re about to buy a business, you may feel incredibly excited about the road ahead. Finally, you get to realize your dream of becoming a business owner! Nonetheless, it’s important that you don’t allow this excitement to cloud your judgment when it comes to finalizing agreements with the seller. 

There are several things you should consider before closing the deal. Take a look at our tips for buying a business to ensure you’ve completely covered your bases in advance of making this monumental decision. 

Consider Getting a Non-compete Agreement

With so many details going into the negotiation process, you may underestimate the importance of including a non-compete agreement into the final purchase and sale agreement. This type of agreement is beneficial for the future security of your business as it guarantees that the seller won’t compete with you for a set period of time. 

“No solicit” and “No recruit” agreements may also be worth considering. A “no solicit” agreement prevents the seller from soliciting your customers, while a “no recruit” prevents them from poaching their former employees after the deal closes. 

Understand the Role that Key Employees Play

Many businesses that experience success do so based on the hard work of a few key employees. If you happen to lose these employees during a transition, you may find that you’re left with a different business than the one you thought you’d purchased. 

Putting in the effort to keep some of the most important employees in their roles can go a long way in maintaining successful business operations throughout your first crucial months as a business owner.

Depending on the situation, you may even want to negotiate a way for the selling owner to remain at the business in some capacity for an extended period of time. This could involve a structured payment plan or incentive plan to encourage peak performance and a smoother transition. 

Avoid the Pressure Trap

Too often, sellers will try to pressure potential buyers into rushing the decision-making process by telling them about all the other potential buyers jumping at the bit to purchase the business. However, these contenders aren’t always real, and these claims shouldn’t necessarily be taken seriously. 

If you feel pressure at any point during the negotiation process, don’t hesitate to take a step back to reevaluate your priorities. Most importantly, never fall into the trap of thinking that it’s worth proceeding simply because of all the time you’ve spent to get to this point. The worst-case scenario is not wasted time, but rather owning a business that you regret purchasing. 

Don’t Overlook Dishonesty

Be wary of sellers whose documents show that they’ve been fibbing on their tax returns. While they may claim that “everyone does it,” you can be sure that if they’re willing to be dishonest with the government, they won’t hesitate to be dishonest with you either. 

If you decide to proceed with a business owner who’s been underreporting their sales, you’ll need to do extra homework to ensure that you won’t be held liable for their behavior. In addition, you’ll want to have all the information they’ve given you independently verified to sort out what’s fact and what’s fiction.

Partner with a Business Broker

Are you in search of tips for buying a business because you feel overwhelmed by the decisions you’re facing as you navigate this complicated process? An experienced business broker can provide much-needed guidance and help you sidestep any pitfalls along the way. 

At Murphy Business, we understand how stressful it can be for first-time buyers to enter into negotiations on their own. You can rely on our professional brokers to assist you as you make important decisions about your future. We offer trusted valuation services, negotiate on behalf of our clients, and can help with drafting a final agreement that allows you to seal the deal with confidence. 

If you’re looking for more tips for buying a business, our business brokers are ready to help. Call Murphy Business today at (888) 561-3243 to speak with a professional business broker near you.  

How to Find Businesses for Sale

If you’ve recently decided you want to become a business owner, congratulations! You’ve just reached a huge milestone in your professional career. If you’re interested in owning an established business but aren’t sure how to find businesses for sale, you’re in the right place. We’ll fill you in on the various roads that you can take to become a business owner by purchasing an already existing business.

Locate Businesses for Sale with These Methods

Whether you want to start your career as a business owner by a specific point in time or are simply on the lookout for good opportunities that may arise, there are a number of routes that can lead you to your goal. Here are some of the most common—and most effective—ways to find a business for sale.

Calling Businesses in Your Area

While you may not feel totally confident cold-calling local businesses at the start, taking this step can help you get a sense of the market in your area. Since many business owners don’t advertise that they’re interested in selling for fear of scaring off customers or startling employees, it’s not always easy to figure out which businesses are for sale without asking directly.

Of course, the vast majority of business owners you reach out to won’t be looking for an exit. Nonetheless, this doesn’t mean you’re wasting your time. The individuals you connect with may be able to refer you to other business owners who are interested in selling. Making these contacts is an essential part of establishing yourself within the network of small businesses in your community and growing the list of people you can reach out to throughout the journey of business ownership.

Browsing Online Aggregators for Small Businesses

It probably comes as no surprise that there are plenty of websites out there dedicated to posting the details of small businesses for sale, including sites like BizBuySell.com and Bizquest.com. Other websites, such as Franchisegator.com, are geared more towards advertising franchises for sale. 

These sites offer tools that make it easy to search through different businesses based on their selling price, location, and industry. By using these tools, you can gain a better understanding of the businesses on the market in different locations if you’re not married to the idea of settling down in a specific area.

Putting Out Your Own Ad

Posting your own ad is a great way to get the word out that you’re looking to purchase a business. This route can bring about different opportunities than those you would find through a simple online search. 

Whether you choose to post on Craigslist.com, a local newspaper, or an industry publication, you increase your chances of catching the eye of a greater range of business owners when you put out an advertisement of your own.

Working with a Business Broker

Partnering with a professional business broker is probably the most efficient way to go about buying a business. Instead of trying to figure out how to find businesses for sale and determining which options are worth pursuing, you can rely on a professional who knows the ins and outs of the process and can guide you every step of the way.

What’s great about business brokers is that they won’t just show you what businesses are for sale in your area; they’ll also offer you expert advice that’s personalized to your individual preferences and professional goals. This can be especially valuable if you’re uncertain about the best industry to enter, or how your personal skills and strengths can contribute to your success in different fields. 

A broker can also expand your horizons about the many types of businesses out there—you might even come across an industry you’d never previously heard of that’s actually a great match for you.

In addition, the experience of a business broker can come in handy for knowing which businesses to avoid buying. After all, not every deal is going to be a good one, and you may not be in the right position to spot the pitfalls before diving in headfirst. Rather than making a decision you’ll regret, you’ll have the benefit of years of experience at your fingertips.

If you want to know more about how to find businesses for sale, get in touch with Murphy Business today at (888) 561-3243 to speak with a professional business broker in your local area. 

 

How to Negotiate When Buying an Established Business

Solid negotiation skills are key in many facets of life—especially when it comes to buying and selling. If you’re looking at buying an established business, lengthy negotiations are a sure part of your future. In order to get the best deal possible, it’s crucial to formulate a negotiation strategy to guide you as you make decisions around the monumental task of purchasing a business.

Whether or not you consider negotiating to be a personal forte, you’ll benefit from reviewing some time-tested negotiation techniques before you begin the process of buying an established business. Read on for some tips from the professional business brokers at Murphy Business.

Nail Negotiations with these Tips and Techniques

    • Consider the whole deal—not just the price tag. Would-be buyers often get caught up on a single number rather than considering the many terms and conditions of the deal in question. Factors like first refusal for future transactions, seller financing, and recourse against the seller in certain circumstances each have a value in their own right. By negotiating terms in addition to price, you and the seller can come to a compromise without sacrificing your top priorities. That being said, it is important to come to the table with a well-researched “walk-away” number to ensure that you don’t stray too far from your comfort zone.
    • Be prepared to make concessions. Making concessions can be a strategic move if you do it right. What’s important is that the seller understands that you’re giving up something you believe to be of value. After making this known, you can ask the seller to reciprocate by making a concession of equal value or meeting a certain condition. It’s also key to make concessions over time, not in one go, to stretch their potential for appreciation further.
    • Don’t be afraid to make the first offer. While you may think it best to wait for the seller to make an offer that you can counter, you can actually gain a significant advantage by being the first to make an offer. After all, doing so enables you to determine the point around which future negotiations will revolve. Just be sure to do plenty of research before naming a number, or you may make the mistake of overpaying for the business.
    • Avoid letting frustration cloud your judgment. If you feel that negotiations are turning into a never-ending process, you could be tempted to settle for a deal you’re not actually happy with. After spending so much time and energy navigating obstacles and making compromises to get to this point, it can be painful to think about walking away empty handed. However, in many cases, that’s simply the best move to make. Keep a clear mind throughout the negotiation process and stay realistic about the possibility of having to walk away.

How the Experienced Negotiators at Murphy Business Can Help

It’s not always wise to jump into the process of buying an established business without any previous experience. At best, you might get a deal; at worst, you’ll be stuck with a dud of a business that you paid too much for. When you turn to Murphy Business, you can have confidence that you’re making business decisions that are in line with your personal and professional goals as well as your budget and the current market.

Not only do we offer access to a wide range of opportunities that you may not find on your own, but we also bring experience and expertise to the table. You can count on us to consult with you in-depth about what you’re looking for in a business purchase before negotiations ever begin. That way, we can help ensure you stick to your priorities as you consider different options.

As we’ll negotiate on your behalf, you won’t have to endure the tunnel vision that often comes with making stressful decisions during what is often an intimidating process. With the ability to maintain perspective, as compromises are made and terms are agreed upon, you’ll increase your chances of finalizing a deal that you’re satisfied with.

If you’re considering buying an established business, it’s best to have experience on your side. Call (888) 561-3243 today to learn more about partnering with a local business broker from Murphy Business.