Author: Murphy Blog

Find Out What Your Business is Worth with Business Valuation Services

Do you know how much your business is worth? Many business owners are uncertain of the true value of their businesses and only have a vague idea of what their selling price would be. With business valuation services from Murphy Business, you’ll gain a better picture of where you stand in the market and the potential for selling your business.

Appraisals are also essential for helping business owners prepare for a variety of professional and personal events, from a merger to divorce and tax issues. When you have a current valuation of your business at hand, you can face the future with confidence and make informed business decisions. Keep reading to learn more about understanding the value of your business through professional business valuation services.

When Are Business Valuations Necessary?

Maintaining an up-to-date business valuation report is not unlike having a resume ready to go in case an unexpected opportunity or unfortunate event comes your way. After all, the unexpected does happen. So you can protect your business and your assets, it’s important to be prepared for situations including:

  • An opportunity to sell the business
  • Adding a new partner or coping when a partner leaves
  • Creating a plan to exit the business
  • Acquiring financing
  • An event in your personal life, such as divorce, death, or disability
  • A natural disaster that affects your business
  • Disputes with shareholders
  • Liquidation
  • Litigation and legal disputes

Understanding the Business Valuation Process

Much like an appraisal for a home sale, the process of business valuation requires an appraiser to analyze the value of assets within the business, depreciation that has occurred, and other important factors that could affect what the business is worth.

The appraiser will also take intangible assets into account during the valuation process. Intangible assets, such as trademarks, patents, copyrights, licenses, customer relationships, and technologies, are often very difficult for business owners to assess on their own. However, they can have a significant value potential that should not be overlooked.

Types of Valuation Reports

Because businesses can be valued in different ways based on the circumstances of the valuation and the information that being sought, there are a range of different business valuation services to choose from. Here are some of the most common options:

  • Business Valuation Report: Provides an abbreviated but formal summary for the determination of a selling price or facilitation of a buy-sell agreement.
  • Calculation of Value Report: Offers a calculated value in line with the standards put forth by the National Association of Certified Valuators and Analysts and the Institute of Business Appraisers.
  • Business Appraisal Report: Presents a step-by-step explanation of the valuation process for use in litigation and for tax purposes.
  • Broker’s Opinion of Value™: Used by buyers, sellers, and brokers for the pricing of small businesses.

Preparing for a Business Valuation

Certain types of valuation processes will require certain documents. However, you’ll likely need to gather the following for the appraiser no matter which type of business valuation report you’ve requested:

  • A company history or description
  • Governing documents
  • Employee information, such as benefits and pay
  • Financial statements
  • Tax returns for the previous 3-5 years
  • Details about company assets
  • Paperwork for legal issues or current litigation

Why Choose Business Valuation Services from Murphy Business?

At Murphy Business, we understand how important it is for business valuations to be thorough and accurate. Our business valuation services are conducted by professional appraisers with expert knowledge in all aspects of the business valuation process, as well as related business transfer procedures.

We work to stay on the cutting edge of developments in the field of valuation and appraisal, taking part in teleconferences and annual conferences whenever possible. We also perform our valuations according to the Uniform Standards of Professional Appraisal Practice of the Appraisal Foundation, in addition to the Business Appraisal Standards of the Institute of Business Appraisers. You can have peace of mind that we work according to proven peer-reviewed valuation methods that provide an accurate understanding of the value of your business.

Don’t wait to have the value of your business assessed by a professional appraiser. Contact Murphy Business today at (888) 561-3243 to hear more about our business valuation services.

Buying an Existing Business? A 2020 Outlook

With the national economy in a stable position and consumer spending at a noteworthy level, it’s no wonder existing businesses are being bought and sold at high rates. If you’ve been thinking about buying an existing business, make 2020 the year you follow through on achieving your business dreams. 

A local business broker from Murphy Business can help you assess your options and handle negotiations so you can start your journey of business ownership with confidence.

What to Consider When Buying an Existing Business in 2020

If purchasing a business is on your list of goals, you’ve likely considered the benefits that come with buying an existing business over starting a business from scratch. However, it’s important to note that in both situations, becoming a business owner can be a complicated and risky venture. 

If you’re uninformed about the lengthy procedures involved in this process, you may find yourself having second thoughts after diving in. By following time-tested procedures and doing plenty of research ahead of time, you can ensure you’re making a decision you won’t regret.

Taking a Step-by-Step Approach to Buying a Business

When it comes to purchasing a business, there are often mountains of paperwork to go through prior to any decisions being made. Not only do you want to take the time to thoroughly analyze these documents, but you also want to be able to properly contextualize the information they contain. It’s this data that will enable you to adequately vet the business and confirm it’s a worthwhile investment of your time and money.

In addition to gathering information about potential businesses, you’ll also need to pencil in time to visit with the current owners of the businesses. Time should also be allotted for discussions with attorneys, financial advisors, and other individuals who will be involved in the asset transfer. At every point in this process, you’ll come upon new data that will factor into your final decision. 

Because there are so many steps to complete before you can even think about signing on the dotted line, a business broker can be especially instrumental in guiding you through the decision-making process and preventing you from overlooking any important details along the way. A business broker can also keep you on the right track so you don’t lose sight of your personal and financial goals when evaluating your options.

Getting your Finances in Order

Your finances are one of the biggest considerations to keep in mind as you think about buying an existing business. In many cases, additional financing may be required. As it can take a significant amount of time to secure a loan, you’ll want to factor this into your purchase timeline.

Whether you are able to pay for an existing business with cash or need financing to complete the transaction, it’s crucial you are comfortable with the end price. The negotiation process can be quite tricky and intimidating for a first-timer. Trusting in a business broker to negotiate on your behalf will give you the chance to take a step back and maintain the perspective needed to make a decision with confidence.

Understanding the Business Environment in 2020

Committing to a good business opportunity often requires some in-depth research into the industries that are currently thriving and are predicted to experience continued growth in the upcoming years. Several factors can influence the types of businesses in this category, from recent innovations in technology to new niches and changes in consumer demand.

Wondering what the current business outlook is for 2020? Some of the most profitable opportunities on the market are in the following industries:

  • Healthcare. As life expectancy rises and baby boomers grow older, there are more and more people in need of high-quality healthcare. Consumers are looking to gain access to healthcare that’s convenient. Consumers are also concerned with general health and well-being making a wide variety of healthcare options available.
  • 3-D printing. From prosthetics to food, 3-D printing enables business owners to create and sell sought-after products at a profitable margin.
  • Office space rentals. With the increase in the number of individuals working remotely or as freelance contractors, there is a greater demand for short-term office space rentals. This niche allows you to make use of a property investment while securing multiple repeat customers.

Finding the Right Business for You

If you’re ready to buy an existing business but are unsure which field is the most promising in the context of your personal and professional ambitions, a business broker can help introduce you to new industries and explain how they could meet your needs. With the support of an experienced broker, you can ensure your decisions make sense in the current business environment so you’re set up to succeed in 2020.

Learn more about buying an existing business in 2020. Contact Murphy Business today at (888) 561-3243 to connect with a business broker in your area.

Finding a Small Business for Sale that’s Right for You

Have you always wanted to be an entrepreneur? If you love the idea of being your own boss, setting your own hours, and being able to take pride in every aspect of your job, then becoming a business owner may be the right step for you. But you don’t have to be sitting on a brilliant business idea in order to become a business owner. Buying a small business for sale enables you to start a business without beginning from scratch.

Finding a business to buy can be a challenging but rewarding experience, and there are plenty of ways to go about this process. Read on to learn about the various methods you can use to find a small business for sale to purchase.

5 Strategies for Discovering a Small Business for Sale

It’s important to take a strategic approach to find a business to purchase. This approach will enable you to peruse and compare a variety of options before making your decision. Here are five methods you can use to discover small businesses for sale.

Connect with Businesses in Your Area

If you’re interested in local small businesses that are for sale, the first step is to network with business owners in your area. While it’s not a guarantee that any of them will be interested in selling, making these connections will give you a better feel for the current market in your community. It will also help get the word out that you’re looking to buy a business in the area.

It’s important to keep in mind that many businesses hesitate to advertise that they’re for sale. There are a number of reasons for this, including the fear of alarming customers and staff. That means you may only be able to find out that an owner is interested in selling by asking them directly. Even if they’re not looking to sell, they might point you in the direction of business owners they know who are in search of potential buyers.

Browse Websites Listing Small Businesses for Sale

Websites like BizBuySell.com and Franchisegator.com are a great place to start looking for businesses for sale, especially if you’re open to buying a business that’s not in your local community. These online aggregators list a wide range of small businesses and franchises for purchase and make it easy to search through their extensive listings by factors like price, location, and industry.

Doing research online makes comparing different options quick and easy and provides you with a wealth of details almost instantaneously. Plus, you can often set them to notify you when a business goes on sale that meets your specific criteria.

Keep an Eye Out for Advertisements

While small businesses aren’t all that likely to put up advertisements on their own property, many do choose to post “For Sale” ads in local newspapers, industry publications, and classified ad websites like Craigslist.org. Be sure to check these sources frequently so that you don’t miss out on an opportunity in your area.

Spread the Word with Your Network

You’ve likely built business connections over the years with people who are in your industry or share your interests. This network is a valuable resource that you can turn to as you begin searching for a business for sale. Your network will have a good idea of the fields you’d prefer to work in and business types that would best fit your skills and lifestyle. 

Turn to a Business Broker

Business brokers are often hired to connect sellers with buyers and assist with the negotiating process. Both individual business brokers and larger brokerage firms typically have access to a large pool of businesses for sale and share this list with potential buyers.

Working with a business broker is almost always the best option for first-time buyers. One often-overlooked advantage is a broker’s ability to help buyers determine what they want out of a business so they don’t waste time during the search. A business broker can introduce you to industries you may not have previously considered and will provide much-needed guidance as you assess different options.

A business broker won’t just help you move in the right direction concerning industries and business types. Their experience can be extremely valuable in understanding the difference between a good deal and a bad one. With a broker, you’ll be more likely to avoid pitfalls that could lead to making a decision you ultimately regret.

Finally, business brokers take over the complicated process of negotiating the deal between the buyer and the seller. You’ll sidestep a lot of stress, save time, and have a clearer understanding of what you’re purchasing when you choose to go through a business broker. For these reasons, using a business broker is one of the most efficient ways to discover small businesses for sale that are right for you.

If you’re ready to find a small business for sale, don’t hesitate to contact Murphy Business Brokers today. Call (888) 561-3243 to connect with one of our local business brokers and get started with a free consultation.

Buy a Company with Confidence with Murphy Business

Murphy Business Brokers can help you find the perfect business.If you want to open a business, you don’t have to start from scratch in order to launch a successful enterprise. In fact, building a business from the ground up comes with a multitude of risks and a high level of uncertainty. Before you can even establish steady cash flow, you’ll have to put plenty of effort into marketing the business and cultivating a customer base. When you buy a company, you can avoid these disadvantages while enjoying the benefits of owning your own business.

If you buy a company through an experienced business brokerage firm, like Murphy Business, can save you time and energy. A business broker can also provide you with a greater level of confidence in your new endeavor. Our local brokers will act as your guide during the decision-making process, helping you make choices that reflect your goals every step of the way. In addition, we’ll assist you with sidestepping common pitfalls that could lead you to make a decision you’ll eventually regret.

How We’ll Help You Buy a Company

There are several steps that go into purchasing a business, and these steps can be quite complicated and time-consuming for first-timers. Having a business broker by your side will save you the stress of going it alone and ensure that you buy a business that is primed to succeed. Read on to learn more about how you can buy a company with confidence when you choose to work with Murphy Business.

Choosing the right business type

There’s no such thing as a “perfect” business. Like many things in life, it’s all in the eye of the beholder. The right business type for you may be the wrong choice for someone else. Until you know all of the options available to you, you won’t be able to make the best decision for your professional future. A business broker from Murphy Business can help you understand which business type will best match your skillset and previous experience. With our assistance, you’ll become more familiar with various industries and be more likely to select the right business for your goals.

Taking a closer look

Once you’ve chosen the business type you’re most interested in, we’ll help you narrow down existing businesses for sale in that field. One of the most important things our brokers do is prescreen businesses, which protects our clients from investing in especially risky ventures. Our system has a proven track record for doing due diligence on business valuations. When you work with us, you’ll know exactly what you’re buying and who you’re buying from.

Sealing the deal

Negotiating the final purchase contract is rarely a straightforward process. However, we can help make it less of a headache for both parties. We’ll represent you during negotiations, assist with writing contract terms that reflect your intentions, and find workarounds for any roadblocks that come up between you and the seller. We can also guide you in acquiring financing and help you avoid commitments that could lead to a cash shortage.

Making a smooth transition

You can count on us to pave the way for a smooth transition that enables you to put your best foot forward as a new business owner. First, we’ll help to negotiate a purchase agreement on the best terms possible. It’s crucial that both you and the owner feel good about what will happen to the business when they finally make their exit. In addition, ending things on a positive note will make it easier to have a successful start with employees, customers, and suppliers, who will all be key players in your daily operations.

We can also help lay the foundation for a smooth transition by writing training terms into your contract with the seller. Depending on the business type you’re purchasing, the necessary training period could range from a couple of weeks to several months. This period is often critical for maintaining consistent business operations during and after the handover.

Buying a company with confidence is all about having the expert support you need to make the best decisions for your personal situation. When you rely on one of our business brokers to be your guide as you choose a business type, evaluate your options, negotiate terms, and finally become a business owner, you’ll have access to reliable information that informs your decision-making process and instills you with confidence about the future.

Learn more about how you can buy a company with confidence today. Just call Murphy Business at (888) 561-3243 to connect with a business broker in your area. 

Business Brokers Help Franchisees and Franchisors

At Murphy Business, we understand the ins and outs of franchising, including the procedures involved in buying and selling franchise locations. After all, we’re a franchise brand ourselves! Our network includes over 250 business brokers with in-depth expertise in the process of transferring businesses. 

Whether you’re a franchisor looking to establish a resale program, a franchisee who wants to transfer your business to a buyer, or an entrepreneur hoping to purchase an existing franchise location, we can help.

How Our Business Brokers can Assist with Your Franchise-Related Needs

As specialists in the sale of businesses, you can count on our expert knowledge for all of your needs related to buying or selling a franchise location. From performing professional business valuations to matching businesses for sale with qualified buyers and conducting negotiations, we’re able to simplify an otherwise complicated process. Read below for details about how our brokers assist with buying and selling franchise locations.

Helping Franchisors Ensure Smooth Resale Transitions

As a franchisor, it’s smart to put a system into place that enables new entrepreneurs to enter your system and allows current franchisees to exist with ease. Through a formal resale program, you can encourage smooth transitions that propel your brand forward rather than causing confusion.

A structured resale program is also an asset in attracting franchisees. Many potential franchisees want to know that there is an organized process in place for them to sell their location after putting in the hard work of running their business. In addition, this type of program promotes proper management of franchises, leading to long-term value and growth.

Putting our brokers in charge of your franchise resale program frees you up to focus on expansion instead of getting caught up in selling existing locations. Plus, we make it possible for you to reduce your liability during the valuation process; thereby ensuring that resales occurring within your system leave new franchisees with a solid foundation for growth.

Helping Franchisees List and Sell Their Businesses

If you’re a franchisee that’s looking to sell your location, it’s important that you’re able to get the maximum profit from this transaction. However, this isn’t always easy to accomplish on your own. Our professional business brokers can help you achieve the highest possible selling price thanks to our extensive knowledge and experience.

First, we’ll conduct an expert valuation of your business, and then we’ll design a complete offering package for marketing your sale to potential buyers. We’ll work with you every step of the way to find a buyer with the qualifications to satisfy your franchisor and help you close the deal in a way that results in a smooth transfer of ownership.

Helping Entrepreneurs Purchase Existing Franchise Locations

While many entrepreneurs choose to open a new franchise location, there are numerous benefits to purchasing a resale franchise that’s already in operation. For example, resell locations generally offer a faster track to profitability with less risk than a new franchise. With an established cash flow, a built-in customer base, and infrastructure that’s already in place, you’ll be able to hit the ground running.

Our business brokers can assist with selecting a franchise to purchase that is both well-managed and offers reliable income. Not only do we have the tools and expertise needed to assess the franchise resale market in your area, but our in-depth understanding of how franchises work also enables us to match entrepreneurs with franchise brands and businesses that fit their strengths and preferences.

We’ll give you counsel throughout the buying process so that you can avoid common pitfalls and enter negotiations with confidence. We can even provide references to experts in the legal and financial fields and assist you with finding financing through lenders in your community.

Learn more about how our business brokers help franchisees and franchisors today. Contact Murphy Business at (888) 561-3243 to inquire about a free consultation. 

 

Wave of Businesses for Sale Linked to Baby Boomers

Over the next two decades, experts say that the U.S. can expect a record wave of businesses for sale. According to some, the size of this wave is so great that it can be more accurately described as a tsunami. And the cause of this wave? America’s retiring generation of Baby Boomer business owners.

Baby Boomers already make up an outsized portion of the U.S. population. As a result, America is expected to see a record-setting generation of seniors as the Baby Boomers retire.

But for the number of Baby Boomers nationwide, this generation has an even larger presence among business owners. And as more Baby Boomer business owners opt for retirement, this will trigger an unprecedented number of businesses for sale.

Baby Boomers Make Up a Large Share of Business Owners

To understand the scope of the issue at hand, let’s quickly look at some data from the U.S. Census Bureau. According to data from 2018, there are now more than 70 million Baby Boomers in the U.S., more than 20% of the national population.

The share of Baby Boomers in the U.S. is a big reason why the average age of a U.S. resident is now 38.2 years old. That’s higher than any other time in the country’s history and a full ten years older than in the 1960s and 1970s.

These figures, however, don’t even start to tell the story when it comes to small business owners. One 2019 study found that 57% of small business owners in the U.S. are currently over the age of 50. Others have found that, even now, Baby Boomers start businesses at a higher rate than any other generation.

But nobody can run a business in perpetuity. As more and more Baby Boomers start to retire, we’ll see more and more of these businesses for sale.

In fact, figures released by the California Association of Business Brokers project that there will be more than 12 million Baby Boomer businesses for sale or bequeathed within the next two decades. The total value of these businesses? More than $10 trillion.

What Makes These Businesses for Sale Different

As we see more Baby Boomer businesses hit the market, it’s worth thinking about what makes this wave of businesses for sale unique.
Earlier this decade, before the Baby Boomer wave started, some experts worried that the glut of businesses for sale would result in an overabundance of supply, triggering a decrease in business values. But over the past few years, as the first Baby Boomers have reached retirement age, we’ve seen the expected increase in business listings. But there’s been no corresponding decrease in business values.
During this time, however, we’ve seen other distinct trends among this first set of sales.

In particular, many brokers have noted how Baby Boomer business sellers have put an increased emphasis on finding the right buyer. Many of these business owners are not simply trying to secure retirement incomes — they’re also trying to secure a strong future for their company.

As a result, they tend to be much more selective about who buys their business. What’s more, because they’re in less of a rush to sell, they can wait out unsatisfactory bids to find the right buyer. And when they’ve found the right buyer, they’re more willing to assist during the ownership transition. By lending a hand during the transition, they ensure their business is in the best possible position to succeed moving forward.

Find businesses for sale with help from Murphy Business Brokers! Call (888) 561-3243 today to connect with your local office and request a free consultation.

Selling A Business? Find Out How Murphy Can Help

If you’re looking at selling a business, it’s key that you have the assistance of an expert business broker service like Murphy Business. We work with a proven model for valuating businesses, marketing to buyers, and selling businesses for fair market value. This model, along with our extensive expertise and experience, has made us one of the most successful business brokers in North America.

We understand how stressful it can be to sell your business without outside support. Not only do you want to ensure that you’re getting maximum value for the sale, but you also want to avoid getting hung up on details and procedural hurdles that could prevent you from closing the transaction once you’ve found a buyer.

With a professional business broker from Murphy Business by your side every step of the way, you’ll enjoy a greater level of confidence when selling your business and less overall stress about finding the right buyer. Read on to learn more about how our business brokerage services can help you make a successful sale.

How Our Services Make Selling a Business Easier

Because the process of selling a business is confidential, most business owners lack the knowledge they need to manage these complicated procedures without help. At Murphy Business, we know what it takes to complete these complex transactions in a way that enables you to sell your business on own your own terms. Our proven track record of successful sales and high closing ratios are a result of our dedication to helping business owners reap the benefits of their hard work.

Here are just a few of the ways that Murphy Business can help you successfully sell a business:

  • We work across all industries and understand local markets. Our local business brokers have a strong sense of their individual markets, including the going rates for a variety of different business types as well as the amount of time it typically takes to close a deal. We’ll leverage this knowledge to target the right candidates when promoting your business. Also since regulations differ based on location, it’s important to choose a local business broker that has a deep understanding of the fine print for business sales in your area.
  • We ensure that your business is properly valued. It’s not uncommon for business owners to have an inaccurate understanding of their business’s worth, making it even harder for them to sell at a fair price. With our professional business valuation services, you can be sure that your business is properly evaluated before listing it for sale. We’ll take a wide range of factors into account, including the management structure of the business and other details that business owners often find hard to quantify.
  • We market your business to a wider, deeper pool. We’ll design a personalized marketing plan to promote the sale of your business using an assortment of targeted strategies. This includes the creation of a detailed Offering Portfolio, which provides potential buyers with essential information in an upfront and efficient manner. Our experience and affiliations with brokerage associations and networks enable your marketing materials to reach a larger pool of buyers, making it more likely that you’ll find qualified candidates in a timely fashion.
  • We assist with negotiating and closing the transaction. You can count on us to make sure the negotiation and closure of the sale is a smooth process. We’ll be there to help assess different offers and handle any negotiations that arise so that you can leave with the very best offer for your business. This professional expertise is often essential to preventing deals from coming apart at the last minute. Plus, our support helps promote the financial stability of your business after the transfer so you can have peace of mind that you’re leaving your business in good hands.

Are you thinking about selling a business? Give Murphy Business a call today at (888) 561-3243 to connect with one of our professional business brokers and request a free, no-strings-attached consultation.

How to Properly Valuate Businesses for Sale

When you’re planning to sell a business or looking at businesses for sale, a detailed business valuation will be crucial. Yet many business sellers and buyers underestimate the importance of valuations, or they misunderstand the valuation process.

So let’s quickly set the record straight.

If you’re selling a business, a valuation has two important functions. 

First, it gives you a sense of how much you’ll get for your business. Without a proper valuation, many business owners have an inaccurate sense of their business’s worth. In these cases, it’s better that owners find this out early — before listing their businesses for sale.

Second, it helps increase the chances of selling your business quickly and at maximum value. Business buyers are much less likely to negotiate pricing than you might expect. If they see a business listed for more than it’s worth, they’ll simply move onto the next listing.

So if your business is overvalued, your listing could stagnate. That extends the time it takes to sell your business. And it can ultimately lower the market value of your business.

If you’re buying a business, the main benefit of valuating businesses for sale should be obvious. When you buy a business, you want to make sure that you’re paying fair value.

But with a proper valuation, you’ll also get a better sense of what returns you can expect from your investment. A professional business valuation will include detailed cash flow projections, giving you a detailed look at how much value the business will generate over the next several years.

Now that we’ve covered the importance of valuating businesses for sale, let’s look at a few different valuation strategies.

How to Valuate Businesses for Sale

If you’re selling or buying a business, there are a few different ways that you can perform a valuation.

Basic Business Valuation Strategies

The simplest strategies used to valuate businesses for sale tend to also be the most common. Examples include:

    • Appraising a business’s assets and liabilities to calculate value
    • Applying a standard multiplier to average annual revenues
    • Applying a standard multiplier to average annual profits

Because of their simplicity, these strategies are popular with independent business sellers and buyers. They’re also common among inexperienced and amateur business brokers.

However, these strategies fail to account for many of the things that actually make a business valuable, particularly after a transfer of ownership. Additionally, they aren’t always an accurate reflection of the market value of businesses for sale.

Professional Business Valuation Services

Given the failings of basic valuation strategies, we strongly recommend hiring a professional business valuation service if you’re selling or buying a business. This should be someone who’s qualified to valuate businesses for sale and who is certified by organizations like the Appraisal Foundation and the Institute of Business Appraisers.

A professional business valuation will consider things like net assets and annual cashflow. But it will also cover a number of additional factors — factors that are much harder to quantify and measure without a valuation specialist.

These include things like the management structure of the business, and whether it’s suitable for operations under new ownership. Many small business owners develop their businesses in a way where, without the owner, the business can no longer operate.

A qualified valuator will know how this impacts the value of a business for a new owner. But this kind of concern will slip by if you apply a basic valuation strategy. And this is only one of the many ways that a valuation specialist can valuate businesses for sale more accurately!

This covers the investment value of a business. But experienced valuators also know how to assess the market value of businesses for sale. 

In some cases, market value may be a different figure from the investment value of a business. Even so, this number will be critical whether you’re selling or buying a business. If you’re selling, you’ll know how much you can reasonably expect to earn from the sale of your business. If you’re buying, it will tell you whether you’re paying a fair rate, based on market indicators.

Selling a business? Looking for businesses for sale? Call Murphy Business today at (888) 561-3243 to connect with a local business broker!

The Advantages of Local Business Brokers

Selling or buying a business is a lot easier with the right broker. If you’re selling, business brokers can help you attract the most qualified buyers, maximize your chances of a completed sale, and recoup full value from your investment. If you’re buying, the right broker can help you find the ideal business for your needs and ensure that you’re paying fair value for your new company.

But this all depends on finding the right broker. And in the vast majority of cases, that means looking for local business brokers — brokers who are based in the same area as the business that’s being bought or sold.

With few exceptions, business sales are inherently local transactions. As illustrated below, it pays to have the experience and expertise of a local broker.

Why Business Brokers Need Local Experience & Expertise

Familiarity with Local Markets

Whether you’re selling or buying a company, it helps to know the local market for business sales. This way, you’ll have a strong sense of going rates for different types of local businesses. You’ll know how long it typically takes to sell a business in your area. And you’ll know where to look for off-market sellers and buyers within the community.

No one has a strong understanding of these factors than qualified local business brokers. An experienced local broker will leverage this expertise to help sellers value and market their businesses accordingly, and to help buyers find the best local business opportunities.

Understanding Regional Appeal

Today, many business buyers aren’t simply looking for a new business to buy. They’re looking for a new community and lifestyle. But as a local business owner, you might not realize what makes your area so appealing to out-of-town and out-of-state buyers.

Local business brokers, on the other hand, know exactly what makes their area appealing to buyers. This includes unique and favorable aspects of the local business climate. And it includes things that make your area a great place to live — particularly for small business owners. This makes it easier for brokers to target the right kinds of buyers and to include regional selling points in marketing materials.

Knowledge of Local Regulations

When you’re selling or buying a business, attention to detail makes all the difference. An ‘i’ left un-dotted or a ‘t’ left un-crossed can lead to major headaches for both parties.

A qualified business broker will understand the importance of these details and will use a systematic process to ensure that nothing gets overlooked. But if a broker isn’t familiar with relevant state, county, or municipal regulations, their process might be insufficient.

Local business brokers work exclusively (or almost exclusively) within a defined area, so they can help you navigate any state, county, or municipal fine print governing the sale or purchase of a business.

Referrals to Area Specialists

Hiring a business broker is a smart move whether you’re selling or buying a business. But a broker isn’t the only specialist you’ll want to hire. At a minimum, you’ll also need a financial advisor and a lawyer or paralegal. And there’s a good chance you’ll need additional specialists, like a business appraiser or valuator.

Hiring the right broker can make finding these specialists much easier. The best local business brokers boast strong referral networks for exactly this reason. When you need a local expert, they’ll know exactly where to point you.

Assistance with Local Financing

Occasionally, a business sale is nothing more than a simple cash transaction. But more often than not, business buyers require third-party financing. And that financing usually needs to come from a local lender.

Experienced business brokers can help buyers acquire financing by referring them to local lenders. In some cases, this occurs through traditional financing. In others, it involves an SBA loan.

Assistance with local financing clearly benefits business buyers. But it also makes life easier for business sellers. By helping buyers acquire financing, local business brokers increase the likelihood of selling your business and can speed up the timeline of your sale.

Connect with qualified local business brokers in your area by calling Murphy Business today at (888) 561-3243!

3 Questions to Ask Before Buying a Resale Franchise Business

Buying an established franchise business can be a rock-solid investment. That’s especially true if you can find a well-run business under a great franchise brand.

However, buying a resale franchise isn’t for everyone. Some entrepreneurs prefer independent businesses. Some would rather start their own franchise instead of purchasing a resale. And if you purchase a poorly run franchise or choose a mismanaged brand, you’re in for serious disappointment.

So before you buy a resale franchise, ask yourself three questions:

    • #1: What makes owning a franchise a better option than independent business ownership?
    • #2: If I want to own a franchise, why buy a resale franchise instead of a new one?
    • #3: How can I find the right resale franchise for my goals and resources?

Franchise Business vs. Independent Business

There’s a long-running debate about whether it’s better to own a franchise business or an independent company. At the end of the day, it’s a matter of personal preference. Some people prefer a proven blueprint and recognized brand. Others want the freedom to run their business their way.

But when it comes to purchasing an established business, there’s a lot to be said for franchise resales. The main advantage here is that franchises are designed for a range of different owners. That makes it much easier for a franchise location to work under new ownership. Whereas, independent entrepreneurs tend to build businesses according to their own preferences and talent. Under new ownership, many of these businesses struggle.

Then you have the usual reasons for choosing a franchise over an independent business. A proven blueprint, plus training opportunities and corporate support, give franchisees a head start. Marketing tends to be easier with a recognized brand and corporate marketing materials. And by choosing a forward-thinking brand, you’ll be well-positioned for future developments in the industry. 

Resale Franchise vs. New Franchise

If you want to own and operate a franchise business, you have two basic paths to ownership. The first is to purchase the rights to a new franchise opportunity and develop your business from the ground up. The second is to purchase a resale franchise that’s already operational.

While many entrepreneurs would rather start a new franchise, others prefer resale opportunities. Resale franchises typically cost more than the startup costs for a new franchise. But they also typically come with less risk and a faster route to profitability.

Here are four other reasons that you might want to purchase a resale franchise instead of starting a new one:

      • Different Business Challenges. Some entrepreneurs love the challenge of building and developing a business. Others excel at managing an already up-and-running company. If you fall into this second category, it makes more sense to purchase an existing company. And if you prefer franchising, that means finding a resale franchise business.
      • Established Cash Flow. Any time you purchase a resale business — whether a franchise or an independent business — you benefit from existing cash flow. A resale franchise provides you with an established customer base, allowing you to become profitable much more quickly. Instead of starting in the batter’s box, you’ll be on second or third base.
      • Existing Infrastructure. In the same way that a resale franchise provides you with existing customers, it also provides you with existing infrastructure. You’ll have key assets in place, such as a physical location, marketing resources, back office systems, and equipment. And you’ll have a staff that’s already familiar with day-to-day operations.
      • Access to Protected Territories. If you get in on the ground floor with a franchise brand, you get your choice of territory. But if you’re late to the game, you might find yourself looking at markets with limited potential. Purchasing a resale franchise business will allow you to acquire the kind of territory you’re looking for.

Finding the Right Resale Franchise Business

Buying a resale franchise can leave you with a steady and reliable income stream for years to come. But if you purchase a mismanaged franchise or join a brand in decline, you’re likely in serious trouble.

One of the best ways to avoid this scenario is to hire a business broker. At Murphy Business, our brokers make it easy to navigate the franchise resale market, matching you with the right franchise business and the right franchise brand.

A great business broker also makes it easier to negotiate and close the purchase of a franchise business. Your broker can counsel you throughout negotiations and help you avoid common mistakes made when purchasing a business. Brokers can also refer you to legal and financial experts or help you acquire financing through local lenders.

Ready to buy a resale franchise business? Call Murphy Business at (888) 561-3243 today to request a free consultation!