Where to advertise selling a business?

The FBB Group advertises its clients' businesses on several Merger & Acquisition websites, such as BizBuySell.com, MergerPlace.com, BizQuest.com, Axial.net, BusinessBroker.net, BusinessesForSale.com, Colorado Businesses.com, IBBA.org, and MASource.org. Occasionally, and with approval of our client, we target industry acquirers through classified advertising in various trade publications, websites, and trade organizations. Another avenue we utilize is mailing to similar-type and synergistic businesses.

who do you talk to about selling a business?

As a result of our marketing efforts, numerous inquiries are received daily. Inquiries come from not only individual entrepreneurs and investors, but also from other businesses, Investment firms, and Private Equity Group. As a result of these inquiries, The FBB Group has an internal database of 2,500+ prospects. We will also talk to referral sources, such as accountants and attorneys.

Who to talk to about selling a business?

Selling a company can be a long and time-consuming process. Generally, the best thing an owner can do is manage his business profitably while engaging an experienced intermediary to prepare a presentation package, screen prospective buyers, negotiate and evaluate offers, and perform the myriad of other necessary tasks associated with the selling process. In addition, an outside party brings objectivity and can act as a buffer between the buyer and you. Business intermediaries and transaction attorneys, CPAs, and perhaps a financial planner.

who pays the legal fees when selling a business?

The purchaser and seller are each responsible for their respective professional fees. For the purchaser, this would usually include attorney and accountant fees. The seller, in turn, is usually responsible for attorney, brokerage, and accountant fees. The amount of these fees will vary with the size and complexity of the transaction.

when selling a business, who pays closing costs?

We are often asked to estimate the closing costs for a transaction. Because each transaction is so different, it is virtually impossible to estimate these costs until the acquisition has been fully negotiated. Other than above, there are not usually a lot of other significant closing costs, although the buyer is usually responsible for paying costs relating to financing.

who to contact when selling a business?

The FBB Group, Ltd., is a Colorado intermediary firm that has been successfully selling businesses since 1982. We have the experience and team you need when considering the sale of your most valuable asset. Our team has over 70 years combined experience selling businesses in Colorado Springs, Denver, Fort Collins, and throughout Colorado's Front Range. We have also sold businesses in approximately 15 other states.

who is selling a business?

The FBB Group represents business owners throughout Colorado's Front Range. Entrepreneurs and corporate divestitures.

what to include when selling a business?

Businesses are sold as going concerns. A typical asset sale includes everything needed to continue operating the business as it had been, to include Furniture, Fixtures, Equipment, Supplies, Working Capital, Leasehold Improvements, Goodwill, Vehicles, and Work in Process, in addition to phone and fax numbers, domain names, trade names or trademarks used in the operation of the business, intellectual property, etc.

what are taxes on selling a business?

Most taxes, such as sales or payroll taxes, will be paid by the seller up to the date of closing. Even though the taxes may not actually be paid at or before closing, such as the case with quarterly unemployment taxes, the seller warrants and guarantees that these taxes will be paid in a timely fashion. Other taxes, such as personal property and real estate taxes, which are assessed and collected once a year, are usually prorated at closing. Often these taxes cannot be precisely determined, because the governing authorities have not finalized the rates prior to closing. The buyer and seller usually agree to prorate these taxes at an estimated amount, such as last year's taxes. There can be significant federal and state income tax liabilities resulting from the sale of a business. We advise our clients to seek the assistance of tax professionals.

what to consider when selling a business?

In addition to the financial gain generally associated with the use of an Intermediary, there are other items an experienced intermediary brings to the table; confidentiality, screening and pre-qualifying potential buyers, a customized marketing plan, and the possibility that their pre-identified and pre-qualified buyer list contains the right buyer for the business. We hope these reasons answer the “why use an intermediary to sell my business?” question and make you realize “I need an intermediary,” because we could all use one.

what to say when selling a business?

Most sellers have the legitimate desire to keep a pending sale confidential as to employees, customers, and competitors. How, then, does a seller reach the people who have the interest and ability to purchase the business? Do key employees leave the business when faced with the prospect of a sale, leaving the owner to scramble to fill the positions, to do the work him or herself while marketing the business, screening prospective purchasers, and answering questions from “tire-kickers?” Or worse, will the competition take away business if customers get nervous upon hearing of a potential sale? An experienced Intermediary lessens those concerns. Keeping the sale confidential is an important part of the job, through blind ads and non-disclosure agreements with potential buyers.

what to disclose when selling a business?

Everything. It is particularly important if you want to sell your business to understand that when you work with an intermediary as a Seller’s Agent, he or she is on your side, working with the buyer to negotiate details and working with lenders, attorneys, and accountants to smooth the transaction and obtain the best deal for you, the seller. Like any other advisor, you must be comfortable with the professionalism and integrity of the business intermediary that is working with you. A good intermediary will also provide proprietary information, such as customer lists, on a "need to know" basis at the proper time in the process.

what to do before selling a business?

Line up your trusted advisors. Throughout the process, sellers are encouraged to seek the help of competent professionals to ensure that their interests are protected. A skilled Intermediary will work with the seller’s attorney and accountant, or will recommend attorneys and accountants who are experienced in working through the various aspects of a transaction. If the intermediary is acting as a “Seller’s Agent,” the intermediary has a fiduciary duty to represent the seller’s best interests.

what to ask when selling a business?

How Do You Get the Best Price and Find the Right Buyer?  To maximize your price, you need a steady record of profits, timely and accurate financial records, a diversified customer base, and backup management that can run the business in your absence.  Good accounting records are one of the most critical tools in maximizing value.  Most offers don't appear out of the blue...they must be solicited.  Discretion and confidentiality are usually crucial.  Key employees, customers, and suppliers have been known to vanish if a company's future seems in doubt.  Employees and competitors typically will value a business significantly less than a third party acquirer.  An experienced Intermediary will know how to confidentially market your business and give it optimum market exposure. 

what to do after selling a business?

After the negotiated training has been provided to the buyer, take a well-deserved vacation!  Then revisit your financial plan to update priorities for our new liquidity.

what to know when selling a business?

The optimum time to sell is before you are forced to do so by health or financial reasons. This places you in the strongest negotiating position.  Ideally, you should actively start the process at least one to two years before you want to complete the transaction, because it usually takes at least 6 to 12 months to sell a business and the buyer may ask you to stay on for a transition period.

what is goodwill when selling a business?

From an accounting basis, goodwill is the amount of the purchase price over the fair market value of the assets.  Goodwill is also an intangible asset.  It is the good name your business has in the community.  You've worked hard building that goodwill, and you should get compensated for all that hard work.

what to consider when selling a business?

There is no simple method to value a business, and there are numerous formulas to take into consideration.  Our experience has shown that there are three key components that are used in computing valuation models: 1) earning power; 2) value of the assets being sold; and 3) marketplace demand.  Earning power is a function of historical annual earnings.  For larger businesses, particularly those with audited financial statements, an EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) calculation is used.  For smaller businesses, the calculation is adjusted by adding back the expenses attributable to private ownership.  An appropriate capitalization rate is then applied to calculate value.  Most investors place extensive weight on the company’s ability to generate earnings, since the cash flow allows them to 1) pay themselves a suitable salary; 2) pay off the debt generally required to buy the business; and 3) receive a return on investment.  The appraised or fair market value of the assets being transferred is also considered.  These factors are overlaid on industry and market conditions to come up with a range of value for the business.

what to do when selling a business?

Keep running the business as if you weren't selling it.  This is extremely important in order to get top dollar for the sale of your business.

what's involved with selling your business?

Competent, trusted advisors, adequate time, and a good plan.

when selling a business, who pays closing costs?

Both the buyer and seller pay their respective advisors.  The seller will also have to pay taxes on the gain generated by the sale.

what taxes are paid when selling a business?

In addition to income taxes, there may be other taxes, such as sales and use tax.  A competent tax professional should be involved.

what are the reasons for selling a business?

There are many reasons to consider the sale of your business; retirement being at the top of the list.  Other reasons may include the owner's health, the need to relocate, burnout, or not being able to devote the necessary time needed to run the business due to unforeseen circumstances.  The most frequent reason is the seller's desire to seek different challenges.

what documents are needed when selling a business?

Among the most important are Federal Income Tax Returns, yearend and monthly Balance Sheets and Profit & Loss Statements, a listing of all Furniture, Fixtures & Equipment along with an estimated fair market value, the Premises Lease and or Real Estate Appraisal, if available, and a summary of existing Financial Agreements.  Additionally, there will be numerous legal agreements, such as a Purchase Contract, Bill of Sale, etc.

what costs are involved in selling a business?

Professional fees, appraisals, commissions, and transfer taxes.

how to prepare for selling a business?

The sale of a privately held business is a complex and time consuming task. It is something that most entrepreneurs do only once in their lifetime, and it may represent the single most significant financial transaction of their life.  Due in large part to the time that it takes to implement changes and to have those changes reflected in the appropriate manner on the seller’s financial records, we typically advise sellers to take proactive measures to initiate the positioning of their business for sale two to three years prior to actually taking their business to market.  Most businesses sales are financially driven transactions.  "GOOD NUMBERS SELL BUSINESSES FASTER FOR MORE MONEY."  There are several ways to implement this concept:  1) Use a full-service CPA firm; 2) Clean up your Income Statement; 3) Upgrade your financials to audited or reviewed statements; 4) Consider changing from a C Corporation to an S Corporation, if you have not already done so; and 5) Clean up your Balance Sheet.  Other things to consider include reducing customer concentration, creating a team of second level management, assembling an experienced acquisition team (typically consisting of an attorney, accountant or tax advisor, intermediary/business broker, and, on larger transactions, a financial planner), curb appeal, documentation, update your business plan, and identifying intangible assets.

how to go about sellinG a business?

Hire experienced, competent advisors.

how to start selling a business?

The best place to start is by calling one of our experienced intermediaries at The FBB Group, Ltd.

how to advertise selling a business?

The FBB Group is affiliated with several nation-wide business brokerage networks, including Nation-List International, International Business Brokers Association (IBBA), the M&A Source, and Corporate Finance Associates.  Our files contain an active list of thousands of buyers — local, national, and international —including high net worth individuals, Private Equity Groups, and both privately and publically owned companies.  In addition, we advertise on several Merger & Acquisition websites.

How Do You Get the Best Price and Find the Right Buyer?  To maximize your price, you need a steady record of profits, timely and accurate financial records, a diversified customer base, and backup management that can run the business in your absence.  Good accounting records are one of the most critical tools in maximizing value.  Most offers don't appear out of the blue...they must be solicited.  Discretion and confidentiality are usually crucial.  Key employees, customers, and suppliers have been known to vanish if a company's future seems in doubt.  Employees and competitors typically will value a business significantly less than a third party acquirer.  An experienced Intermediary will know how to confidentially market your business and give it optimum market exposure. 
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