Peggy Kragh on the Value of Selling with a Business Broker

Before becoming a business broker, Peggy Kragh’s career included stops in e-commerce, online publishing, construction, property management, and telecommunications. Peggy’s marketing savvy and a finance background led to success at every step of her journey. But it wasn’t until she joined the Murphy Business network that Peggy found her true calling as a professional business broker.

“It’s not an easy business,” she explains. “But it’s very rewarding to see a seller get full value for their business and to see that business flourish after a sale.”

Since launching her brokerage business in 2008, Peggy has become one of Murphy’s most successful business brokers. She is a three-time member of Murphy’s “Million Dollar Club” and was named the #1 Murphy Business office in 2015. These days, Peggy handles business sales in three of Montana’s most attractive metro areas, boasting a sell-through rate of more than 80%.

In a recent conversation, we asked Peggy for her advice to business owners getting ready to sell their business. Here’s what she had to say.

Why Hire a Business Broker When Selling?

Every year, thousands of business owners sell their companies. Yet the vast majority of these sellers don’t actually bother to hire a business broker. According to Peggy, many of these sellers struggle to sell their business for proper value.

“We hear over and over how business owners have tried to sell on their own and have run into problems,” she says. “Most business owners have never done this before, and a business broker brings a lot of value to the process.”

In Peggy’s experience, business owners make a number of common errors when they try to sell a business on their own. Some end up selling their business for a fraction of its actual value, while others struggle to attract qualified buyers.

“One of the biggest mistakes that business owners make is selling to the first buyer. Someone approaches them to sell their business and they make that sale without putting their business on the market. I always say that one buyer does not make the best price.”

“Other business owners will put too high a price on their business, and then it doesn’t sell. If it sits on the market, people start to think there’s something going on with it, and then you need to drop the price dramatically.”

Peggy says that business sellers can easily avoid these issues by hiring a qualified and experienced business broker. This way, you can start with an accurate sense of your business’s value. What’s more, you’ll have an expert to help you maximize that value.

The Value of a Professional Business Valuation

When a business owner comes to Peggy with the intention of selling their business, Peggy starts by conducting a professional business valuation. This, she says, is an integral step for business sellers, one which underscores the value of hiring a business broker.

“Most property owners know the value of their property. But business owners rarely know the value of their business. We show them on paper what that value is and where that value comes from. Once somebody has gone through that process, they understand our value, because they understand that we know the market.”

During the valuation process, Peggy works closely with business owners to help them understand how their business value has been calculated. Sellers learn how different aspects of their business influence this figure, as well as what steps they can take to boost the value of their business.

“What I’m doing is helping someone understand the value of their business, and what’s a big contributor to that value, and what’s a big deterrent to that value,” Peggy says, stressing the importance of the valuating your business with a business broker. “You have to have a baseline, and you have to understand what creates value in a business.”

Boost Value with Help from a Business Broker

Once her clients have gone through the valuation process, Peggy employs a number of strategies to help them capture full and fair value for their business. If a seller is happy with the valuation figure of their business, Peggy helps them market their business. As a member of the Murphy Business network, Peggy has access to national and international brokerage associations, allowing her to reach a wider pool of qualified buyers.

Before listing a business, Peggy prepares bespoke marketing materials for the business. This helps her attract a larger pool of qualified buyers, and it helps her clients capture full value for their business. “It takes packaging,” Peggy says of the marketing process. “You already know the value of your business. But we package the business so that the buyer sees the value.”

If the valuation figure is lower than the seller expected, Peggy will work with them to boost the market value of their business. To do so, she identifies issues that reduce the business’s value on the open market, as well as strategies for how to increase the business value.

According to Peggy, there are three common reasons for a lower-than-expected business valuation:

  • Dependency on the Owner. “A business owner who’s required for everything — that’s not attractive for buyers. What happens to the business when the previous owner isn’t there?”
  • Concentration of Customers. “We see a lot of businesses where 70% or more of their business comes from just one or two customers. That’s a big risk for a new owner.”
  • Living Out of Your Business. “You need to keep your personal life separate from your business life. I always tell clients: Clean records sell.”

Peggy says that a number of her clients who were initially disappointed with their original valuation later managed to sell their businesses at a much higher figure. She cites one case in particular where a seller received a much lower-than-expected valuation. With Peggy’s advice, the owner successfully doubled the value of his business.

At the end of the day, Peggy believes that hiring a business broker is an important step for any business seller. “Selling a business is an emotional process, and most business owners have never done this before. They need someone to guide them through the sales process and get them across the finish line.”

Getting ready to sell a business? Call Murphy Business at (727) 725-7090 to connect with a local business broker and learn more about our services.

7 Reasons to Hire a Professional Business Broker

If you’re planning to buy or sell a business, you’ve likely thought about whether to hire a professional business broker. This could be one of the biggest transactions you ever make, so it’s important that you leave nothing to chance. A business broker will be there at every step of the transfer process, protecting you from costly mistakes and ensuring you get maximum value from your investment.

Despite the advantages of hiring a business broker, many business sales still occur without one or more parties retaining brokerage services. That can lead to serious problems. So, if you’re on the fence about whether or not to hire a broker, it’s a good idea to take a closer look at the advantages offered by a professional business broker.

7 Advantages to Using a Professional Business Broker

1. Save Time. Buying or selling a business is a complicated process. If you don’t have extensive experience in the world of business sales, each step of this process can take an extraordinary amount of time. A professional business broker gives you the experience you need to shrink the timeline of your sale/purchase. He or she will also do much of the heavy lifting on your behalf. This could save you literally hundreds of hours compared to a DIY approach.

2. More Opportunities. With the right broker, you can reach a much wider pool of buyers or sellers. Take your local Murphy Business Broker. Each of our brokers is tapped into his or her own local market, providing you with an inside track on business sale opportunities within your metro area. At the same time, our brokers have access to national and global business sales networks. This gives you access to a near-unlimited pool of buyers and sellers.

3. Qualifying Expertise. Many of the biggest mistakes made in business transfers happen at the qualification phase. Mistakes at this phase can result in pursuing bad prospects, leading to untold amounts of wasted time and money. In the worst cases, a deal can fall apart in the finalizing stages, after you’ve already taken steps to assume or relinquish ownership of the business. By hiring a professional business broker, you can ensure this process is properly handled, protecting your interests.

4. Business Valuations. Another common problem in business transfers is the improper valuation of a business. If you’re buying a business that is priced over its value, you could end up with an abysmal return on your investment. The same applies if you’re selling a business that is undervalued. Many professional business brokers — including your local Murphy Business Broker — can connect you with an accredited valuation expert, ensuring you get fair market value for your investment.

5. Assistance with Financing. If you’re planning to purchase a business, there’s a good chance that you will need financing. This is yet another area where a professional business broker can provide guidance and assistance. At Murphy Business, we connect purchasers with banking contacts and provide detailed advice about how to pursue financing.

6. Confidentiality. Every year, an untold number of sales implode due to lack of discretion. If word gets out that a business is for sale, that business could run into serious problems. Workforce morale could plummet, employees could jump ship, and customers could start to shop elsewhere. When you’re selling a business, a professional business broker can protect your identity and that of your business. This way, you can avoid unwanted disruptions until the sale is finalized.

7. Paperwork & Legalities. When you are purchasing or selling a business, minor oversights can have major consequences. It is therefore critical that any documentation is handled correctly, and that you are guided by experts who understand the legalities of the sales process. A professional business broker will ensure that you are covered in both of these areas.

Looking to hire a professional business broker for help buying or selling a business? Call (727) 725-7090 today to connect with your local Murphy Business Broker and get started!

How Do Business Broker Services Work?

We wish that buying or selling a business was as simple as holding a sign on a street corner, but it’s significantly more complex. This is why smart business owners use professional business broker services such as those provided by Murphy Business.

Business broker services from an experienced, reputable firm are worth their weight in gold! For instance, Murphy Business understands all of the marketing, financial, and legal tasks necessary to accommodate business buyers and sellers. This knowledge allows us to successfully complete transactions to satisfy the needs of each of our clients.

Business Broker Services are All About Relationships

Buying or selling a business involves many complex transactions. To do it right, your business broker should help you get the best value for every dollar spent on buying a business, or the highest profit when you sell your business. This depends a great degree on having well-established relationships with a wide range of professionals. Ideally, business broker services include connecting clients with prospective buyers and sellers in a wide range of industries and business types.

If you are selling a business, you’ll benefit from the knowledge and experience of our business brokers. We specialize in the sale of businesses, so we have a depth of knowledge not often found with other real estate or sales firms. We’ll provide seasoned advice and guidance while connecting you with buyers who are ready to move forward with the transaction.

If you are buying a business, Murphy Business has access to listings of thousands of businesses for sale. Many of which are not publicly advertised. When you use our business broker services, you will have plenty of choices to sort through to satisfy your purchasing interests and desires.

A good business broker will also have excellent relationships with accountants, financial advisors, bankers, real estate agents, attorneys, and others. The reason? A typical business sale requires the input and assessment of a variety of professionals who will provide specialized expertise and help move each transaction forward.

Of course, the key relationship provided by business broker services is the relationship between the individual client – whether buyer or seller – and the brokerage team. Most brokers have experience buying and selling businesses of their own and having “been there, done that” they know the right people and have the right connections to make a business purchase proceed smoothly. You can trust their judgment and advice.

The Business Broker Service Process

The business broker service process generally follows a systematic procedure. First and foremost is gaining an understanding of the personal needs, interests, and desires of each client. Then, our business brokers can proceed with recommendations, tweaking of the recommendations based on your input, and acceptance by and execution of the process that will result in a closed deal.

Here are the steps that you might expect to SELL A BUSINESS:

  • Initiate a non-disclosure agreement with owner
  • Examine business financial data and determine fair market value
  • Prepare an informational package describing the business
  • Create a custom marketing plan
  • Confidentially market to prospective buyers through global networks
  • Qualify prospective buyers based on financial capability and seriousness
  • Evaluate offers and negotiate terms
  • Consummate the transaction in conjunction with the seller’s tax and legal advisors

We may tap into multiple sources of financing to assist a business purchaser so that the seller doesn’t have to provide any financing.

Get Closer to a Sale with Business Broker Services

With our extensive network of business contacts, our practical system for selling and buying businesses, and our proven successes since 1994, our business broker services are well worth checking out.

We are here to give you personal attention and close professional guidance to ensure your business sale or purchase transaction runs smoothly.

Learn more about our business broker services, by calling (727) 725-7090 or contact us here.

Offense or Defense? Small Business Owners Play Both!

As we approach the end of the regular college football season, most Americans are ready to cheer on their favorite teams during December’s conference championship games and the bowl games beginning later in the month and continuing into early 2014.

Professional football fans are right in the middle of the regular season, which will culminate on February 2 at Super Bowl XLVIII in New Jersey.

Amateur and professional football players generally have one specific position to manage and focus almost entirely on playing offense or defense. Small business owners, however, do not have the luxury of devoting all their time and energy on one specific task.

Entrepreneurs wear many different hats and often change them throughout the day, if not more frequently.

Entrepreneurs must be ready to tackle any situation or challenge that each day (or hour) brings.

A small business owner plays offense and defense. Often he’s the head coach, leading the team and making crucial decisions. Sometimes, she’s part of a special team, bringing unique skills and unconventional thinking to a project. Other days, he might be the quarterback, making a lightning-fast decision and finding the best team player to take the next step.

Companies must carefully weigh their environment and decide when an offensive strategy will work best and when a defensive position might be more helpful.

Launching a new product or service should involve a marketing strategy that is bold (an offensive posture); at other times, it might be best to bring in your public relations crisis management team. Although the latter may start as a defensive move, having the right message broadcast at the right time can quickly move you back to a more comfortable place (ownership of the ball).

An entrepreneur who can easily adapt from one position to a completely different one without changing stride is likely to be an exceptional and proactive manager of his resources. Employees tend to gravitate toward these types of leaders and want to be part of this style of team management.

No matter what the size of your business, it’s a tough field in today’s economic climate. Technology changes, which is good but can also produce additional expenses. Competition may increase as new companies enter the field and charge far less than the average, just to “get going.” Customers become fickle. And so on.

View your business and each day as a head coach. Strategize in advance, be aware of unexpected challenges and send your strongest players out to keep the offense up and the momentum moving!

Small Businesses and the Law

Did you know that your small business is subject to the same regulations as a giant commercial entity? If you find this startling news, you’re not alone; most entrepreneurs in the United States assume that laws apply only to much larger corporations.

All companies – small, medium, large and mammoth – must adhere to the applicable local, regional and national laws and regulations.

Hopefully, you’ve been aware of these since the day you opened for business, but if not, we encourage you to take the time now to become compliant. You may wish to engage legal counsel to explore these areas more thoroughly and ensure you have adequately covered yourself and your company.

Let’s begin with your great idea: have you protected your intellectual property? You may wish to investigate filing for a trademark, patent or copyright. A related issue is having non-disclosure contracts in place to prohibit employees or others closely involved with your company sharing your proprietary information.

Spreading the message about your great products or services? Your clients and customers are protected by numerous advertising and marketing laws. The Federal Trade Commission is the agency mainly responsible for enforcement of these laws and regulations. At a minimum, advertising must be truthful and not deceptive, and advertisers must have evidence they can produce that reinforces any and all claims.

Other laws abound in specific industries and for certain products, so investigate all regulations pertaining to your particular industry and products or services.

In addition to the Federal Trade Commission, state and local regulatory agencies also govern advertising. Many resources and publications are easily available on the Internet to help navigate through the complex rules for advertising. The Consumer Action Handbook (http://www.usa.gov/directory/stateconsumer/index.shtml) is a great place to start.

Protection is provided for investors and others related to areas of finance through securities, bankruptcy and antitrust laws.
Privacy laws ensure your customers know how their personal information will be used, shared and protected.

Your business may also be impacted by environmental regulations or by the Uniform Commercial Code, should you transact business outside your state.
Last – but certainly not least – are the numerous federal and state labor and employment laws. It is wise to be aware of the many regulations in place that protect employees. This extensive area includes child labor, wages, employee eligibility, workplace safety and health and workers’ compensation.

We will go into more depth on labor and employment laws and some of the others mentioned above in future blogs.

In Case of Emergency, is Your Small Business Prepared?

Natural disasters may hit at any time of the year, but the recent wildfires in Colorado and derecho (line of violent thunderstorms) that cut a path across the Midwest and mid-Atlantic have made Americans aware that the atmosphere is often very unstable during the summer months.

Have you given any thought to a disaster plan of action for your small business? Having a continuity strategy in place prior to an emergency situation can go a long way toward helping your company return to normal business operations sooner.

An obvious place to begin is reviewing and possibly updating your insurance coverage. Store hard copies of important insurance and other paperwork in a safe place. A remote location is ideal, provided you are able to easily retrieve these documents after a disaster.

As you plan how your business would function day-to-day, think about how you would communicate with your employees. Are there two or three key managers who could be assigned with specific tasks prior to an approaching storm? Are employees able to work remotely during emergency situations?
If your company is a retail operation, what circumstances would dictate a change in business hours? How would altered hours be shared with your existing customers and the general public?

Is the physical location of your company in a low-lying area, subject to flooding? How do you protect your inventory and FF&E? How would travel to your location and parking at your facility be affected? It may be wise to stock up in advance on extra office and related supplies. Power outages and other utility disruptions almost always occur when a disaster hits. Often, days or even weeks may pass before electricity is restored. Would having a backup generator be worth the initial investment in order to keep your company running immediately after an emergency?

What about important electronic data? Some careful consideration should be given to the method and frequency chosen for saving pertinent data. Are back-up files stored remotely and safely?

If you have experienced physical or economic damages after a disaster, there may be relief in sight. The U.S. Small Business Administration (SBA) offers assistance to eligible companies in declared disaster areas. Any size company may provide an application for a low-interest loan to help repair or replace damaged property and items. There are also working capital loans available to help relieve economic injury caused by a declared disaster.
The loans are available at reasonable terms and can typically also cover uninsured losses.

For additional information, please contact the SBA directly at 1-800-659-2955 or disastercustomerservice@sba.gov.

And start planning your recovery strategy in advance of the next natural disaster or other emergency.

Labor and Employment Laws

In a previous post, we noted that small businesses are not exempt from following federal and state laws and regulations. Being unaware of these many laws does not mean you can ignore them. Failure to comply might result in hefty fines or civil penalties. In some instances, criminal charges could be a factor.

Some of the most numerous and complicated laws concern labor and employment. There are many regulations in place that protect employees, covering everything from child labor to safety in the workplace.

Approximately 125 million workers are protected by the 180+ laws enforced by the U.S. Department of Labor (DOL). Its web site (www.dol.gov) offers information on how to comply with these federal laws. The DOL has several agencies that administer various regulations.

The DOL’s Wage and Hour Division (WHD) administers the Fair Labor Standards Act (FLSA). The division’s mission is “to promote and achieve compliance with labor standards to protect and enhance the welfare of the Nation’s workforce.” The FLSA covers minimum wages and overtime. The Act restricts the hours children under the age of 16 may work. Garnishments of employee’s wages, the Employee Polygraph Protection Act and the Family and Medical Leave Act (FMLA) are also administered by the WHD. The FMLA applies to employers with 50 or more employees and mandates eligible employees receive up to 12 weeks of unpaid leave for births, adoptions and serious illness of employees and their immediate family members. The FMLA ensures the employee will be able to return to his previous job after the leave of absence.

The Occupational Safety and Health Administration (OSHA) manages safety and health issues in the workplace through the Occupational Safety and Health Act.

If your company offers pension or welfare benefit plans, you are responsible for following the reporting requirements of the Employee Retirement Income Security Act (ERISA). ERISA supersedes state laws and penalties for failing to file the required reports can be substantial.

The Veterans’ Employment and Training Service (VETS) protects those serving in the reserves, National Guard or armed forces. Some affected have the right to be reemployed by their employer at the time they entered service, in addition to other special rights.

Certain industries have specific regulations (transportation, construction and agriculture, among others), so be certain you are familiar with laws relating to your particular company. Businesses that receive grants, financial aid or contracts from the government are subject to another particular set of regulations.

The laws are numerous, but a little attention now to ensure compliance is a lot easier and less expensive than taking corrective action later.

The Value of Organization and Time Management

How often do you find yourself looking for that important – yet somehow misplaced – piece of paper? Do you promise yourself that you’re going to become better organized, but find the days, weeks and months slipping by with too much work to do and not enough time to start that new filing system or categorize your overflowing email messages?

Everyone can benefit from good time management skills, but these practices are particularly valuable for entrepreneurs, who typically wear many hats on any given day and don’t ever seem to have a second to spare.

Here are some tips that successful small business owners and time management experts have shared with us:

The best and the worst of times -To better assess what changes might be most helpful for you, it is crucial to understand how you spend your time each day. Where are you not making the best use of your time? Another way to approach this is to note what you are doing differently on the days you find yourself most productive.

Are you diligent at daybreak or mentally best at midnight? Do you need solitude and a deadline to focus, or do your best ideas seem to be found after social interaction or when you’ve taken the time to simply let your mind wander?

But it’s Leap Year, so I got an extra day – Every day has 24 hours, and there’s nothing you or I can do to modify that. It is up to each of us to manage our behavior: it’s the only way to better cope with the finiteness of time.

Eliminate those distractions that are not helping you become productive. Find a system that works to help get – and keep – you on track (there are many available, so choose something you feel comfortable with and will use). Set realistic goals toward better time management. Streamline your inbox and organize physical and electronic files of information.

Routine tasks need handling, but perhaps they need time limits. A perfect example of this is reading and responding to email. If you keep an eye on incoming email messages all day long and then stop to respond immediately, there might be room for improvement by simply limiting the times you read and reply. Many small business owners put email at the top of their list as an area that truly needs better organization and time management.

What’s really important – Make that decision and prioritize each day accordingly. Many small business owners feel they accomplish more if they begin with the most difficult challenge. Usually this is the very task one wants to avoid but by facing it first, with fresh energy and a clear mind, you might find it wasn’t so bad after all. When using this approach, deadlines are often met ahead of schedule.

Let someone else do it – Determine which jobs could or should be outsourced, and then allow someone else to do the work. Tedious or simple tasks could be contracted out to free up your time for something more precious, and those areas that fall outside your comfort level and areas of expertise should definitely be left to the professionals.

Just say “no” – Only you can decide where your time should be spent. In addition to running your company, you want to ensure you enjoy quality time with family and friends. Most entrepreneurs are also involved in their communities, which is a wonderful way to serve others while networking to help grow their companies.

But, how much time do you really have? Many self-motivated business owners find it difficult to turn down requests to serve on boards or volunteer in other capacities. By thinking about your time restraints in advance, and realizing how much energy will be required for various community activities, you might find yourself making different choices going forward.

This pie is always being cut in different proportions: one year may be a great one for volunteering, as your youngest child heads off to college; another year might be too busy with helping your parents move, hiring new employees and wanting to spend more time with your spouse.
Be true to yourself as you give of your time and talents.

What I need most – Don’t neglect spending time just on you. Understand your physical and mental limitations and respect those times you need to take a break. When you find your schedule slowing, embrace it (that might be a great time to review your progress and switch priorities).

One final note is that some flexibility must be considered with anyone’s schedule, but by spending a few moments each day organizing and staying on track, you are creating habits and routines that will enable you to stay calm and focused as you manage your small business (and your life!) now and in the future.

Just as I Remembered: Why Consistency is Important for Your Company’s Success

I like consistency. I bet your customers like it, too.

Consistency brings repeat business from satisfied customers. It’s a simple thought, but one that is often overlooked in small companies.

Franchises are a step ahead in that regard. Although part of the charm of travel is discovering boutique hotels and wonderful local restaurants, if you are in a strange town and didn’t get recommendations from friends or do some research prior to arriving at your destination, are you going to take a chance or simply go with the familiar — patronizing places you recognize and know will deliver the products and services you need?

If you’re in a hurry and driving in a strange part of your own town, are you likely to pull up to a Starbucks or McDonald’s for your coffee fix? You would, after all, be familiar with how the drive-through systems work (even the dual lanes and separate windows for payment and product) and whether or not the restaurant takes plastic cash. You know how many ounces are in each size and what they cost. You probably don’t even have to review the menu unless you are in the mood to try something you don’t generally order.

If your customers are coming back, they are pleased with the consistency of your product or service.

They are also probably familiar with the interaction they expect to have with your employees and have been satisfied with their experiences in the past. Whether your customer chats with a representative on-line or welcomes a member of your staff into his home, he knows what to expect. In retail settings, especially, customers feel confident locating store personnel when employees wear some type of company uniform. Although each is a unique individual, your employees should be relaying a consistent message through consistent behavior. Think of a different scenario: a hospital patient is also a customer. Although the stakes are higher and more personal, patients are looking for consistency from health care workers. If one medical professional washes his hands carefully and dons protective gloves before certain procedures, wouldn’t the patient expect that same behavior from the other staff members?

Also remember to keep consistent with your marketing. Branding is extremely important to a company’s success. Logos and slogans are to be recognized and remembered. Think carefully before making a decision to change either of these. Keep your message consistent in all written materials, packaging and advertising, as well as in the content of your web site and on social media.

Inconsistency is definitely inefficient. Corporate policies and ongoing training go a long way toward encouraging consistency. It is tempting as an entrepreneur to sometimes just take each day as it comes, but this often causes the business owner to spend a lot of time and energy putting out fires instead of preventing the initial sparks.

Thoughtful consistency is an integral part of a successful business plan.

Free Help for Your Small Business

Looking for some temporary help this summer for your small business? How does an enthusiastic, motivated worker at a reasonable hourly rate sound? In certain instances, you might even be able to attract such talent at no cost to your company.

College students looking for intern positions are a valuable resource for many organizations. The National Association of Colleges and Employers (NACE) estimates an 8.5 percent increase for interns hired in 2012, compared to just one year ago.

Internships are a win-win situation for both the entrepreneur and the student. It provides you with new talent at a minimal cost. Interns are generally eager to learn and will work cheerfully and diligently, as they are hoping for the chance to acquire new skills and additional experience. A savvy intern is probably also hoping to impress you and receive a solid business reference and possible future job offer.

Of course, inexpensive labor should not be simply given the lousy assignments no one else in the office wants to handle. Interns are helping your business in any way you ask, but also expect to learn about your company. It’s probably a given an intern knows how to file and take out the trash, so these are not the types of tasks a student is wanting to solely perform this summer.

Most college campuses provide a tight-knit community for students, so word tends to travel quickly when an intern discovers a choice or not-so-choice assignment. To ensure you are able to recruit the best candidates each year, make sure your interns feel valued.

Here are some tips to make the experience a positive one for both you and your intern:

  • Provide a job description, as you would with any paid employee. Include short- and long-term goals, and be as detailed as possible where necessary.
  • Offer an orientation (again, just like any other type of new employee would receive). Ensure the intern has the opportunity to meet everyone on your staff during the first day or two of employment. Handbooks and other materials are welcome.
  • Designate a specific individual to act as the intern’s manager or mentor. This is a huge time-saver for the entire company, as the intern has one person he can rely on for answers to questions, and other staff members are able to focus completely on their other responsibilities.
  • Allow the intern to complete at least one project from start to finish during his stay at your company. Offer the intern the chance to showcase his accomplishments via a formal presentation by the intern to your management team.
  • Provide constant feedback.
  • Allow the intern the opportunity to “interview” members of your team during his tenure. Students generally consider the time spent listening to professionals at all levels of management describe their jobs and career experiences to be extremely valuable.
  • Consider hiring more than one student. A sole intern may feel somewhat like an outsider at his new position, particularly if there are no other employees close in age or relatively new to the company. Providing an “intern team” right from the beginning helps the interns feel more comfortable from the first day – and also gives you, the potential employer, an excellent opportunity to see how different individuals contribute to your organization.
  • Arrange for a specific work area for your intern. Nothing makes an employee (paid or not) feel less wanted more than shuffling him to a different work station every day.
  • Always conduct an exit interview. This is essential for both parties to receive feedback in numerous areas and should help you and your intern better prepare for the future.

 

This year, the U.S. Department of Labor is offering a special initiative, Summer Jobs+Bank, to assist businesses and students with internships. For more information on how your company can participate, visit http://www.dol.gov/summerjobs/Employers.htm.

One final note of importance: Obviously, most interns would prefer a position that compensates them; however, unpaid internships are a viable and legal alternative.

If you choose to offer unpaid internships, be aware that many of the same labor laws and regulations that govern your paid employees will also apply to unpaid interns. Please check with local, state and federal authorities for regulations that will apply to your specific internship program.

No business is too small or too large for an internship program, and everyone benefits if the program is properly managed.
Most entrepreneurs report the experience of seeing their company through fresh and enthusiastic eyes is a special one! We would enjoy hearing about what you have planned for the summer of 2012.