–SINCE 1982–

Selling a Company is a Team Sport

FBB eNews
June 2016


In This Issue  

 Selling a Company is a Team Sport

You are a business owner. A self-starting, take charge individual that is not afraid of a challenge and eats adversity for breakfast. You possess the critical mix of creativity, persuasiveness, and tenacity that it takes to go it alone in the world. You are smart, but have learned the hard way, as well. You drove the bus as your company grew, made key hires along the way and made adjustments as things changed. You know your business intimately, in every detail, it is part of you. There are not many like you, as evidenced by the small group of business owners in today’s economy.

As things grow and change, your life experiences, lifestyle, and family situation changes. It is of no surprise, then, that a great deal of consideration should be given to an exit. Can you convert all of this hard work, years even, into a new chapter of your life?

As the market for business sales has heated up in the last few years, many have found themselves in similar situations, wondering how much their business is worth, who will buy it, how long will it take to find the right buyer – just how should this potentially herculean task be handled? How should you go about simultaneously managing the business you have successfully built while executing the wide variety of tasks the transaction will require?

Bain & Company, a consultancy, recently reported comments from a group of CEOs, all representing companies that have struggled or “stumbled” in the recent past. These companies were very large businesses, but the message was clear for organization of any size. Over 70% of respondents noted first that the organization had “lost its focus” prior to difficulty. The report pointed out that these businesses got derailed from their primary purpose or otherwise distracted from their core competency, which led to their financial troubles. The moving parts of the sales process can certainly get in the way of maintaining focus.

As a business owner approaches a possible exit, loss of focus, due to the complexity of managing the sales process, is just one of the pitfalls they will run up against. Getting that deal across the finish line requires consistent financial performance, which can suffer when leadership takes its eye off the ball.

Avoiding this and other critical missteps requires a team. A team was assembled to operate the business as it grew in complexity. The more highly specialized tasks of preparing, marketing, and closing a business sale requires a new kind of team, an experienced team of financial and legal professionals. Most importantly is direct deal experience. Experience is critical in order to anticipate the many diverse issues that can, and most times do, erupt when selling a business and then heading them off at the pass.

A professional approach is required to properly present the opportunity to a group of buyers. Knowledge of financing requirements, for example, guide the preparation of materials prior to going to market, dramatically improving the likelihood of success and shortening the time it will take. Anticipating what will be required by lenders, what operational issues will need to be addressed, and what potential tax issues may be relevant to the transaction all are part of the in-depth insights available to the Seller – given the experience of the advisor handling the transaction. Starting off on the right foot immediately addresses the many potential obstacles that often prevent a sale from closing.

Confidentiality, though, is key. Opening up your organization to the possibility of losing customers, employees, or other critical partners is a major concern. A professional firm that represents sellers exclusively is well versed in managing this very important aspect of a transaction. Controlling the timing and method in which the business is exposed to potential acquirers, ensuring that only qualified parties are admitted to the process, and protecting the client’s interests are paramount to a well-managed process.

Getting a sale over the finish line requires a mix of skills that are unique to business transactions. Deal structure, tax issues, payment detail, and financing items can get very complicated. A recent transaction that was closed at FBB totaled up over 1,200 emails in just a few months. What seems, on the surface, to be a fairly straightforward proposition becomes mired down in unexpected details. Using a skilled deal expert to quarterback details and assemble the team is the right first step in the process of selling your business, ensuring the shortest possible time, the highest odds for a successful closing, and a higher sales price.

The majority of our business is derived from referrals. Please consider referring our services if you encounter a situation involving the potential purchase or sale of a business.

Ronald V. Chernak

Inspiring business relationships since 1982!





Restaurant/Sports Bar with Real Estate #716
Unique restaurant and full-service sports bar in a highly visible, high traffic area. Proximate to a main thoroughfare and near several well-known hotels. Seats 215 indoors and another 96 outside on the heated patio. State-of-the-art equipment. Designed and engineered specifically to accommodate brewery equipment. Plenty of parking. Ready for expansion, as the brand has been trademarked for all 50 states.   Real estate available to purchase for $2.48 million (subject to appraisal). 
Purchase Price………..TBS
 Down Payment……..TBS
For more information,
contact Lynn Lage


Unique Logistics Businesses #216 & #316
These businesses specialize in services provided to municipalities, schools, institutions, and businesses. Services include the handling of furniture, storage, and relocation needs, to include sales, new installations, configurations, tenant finish, comprehensive project management, shelving, warehousing, delivery, inventory, and design. Projects, although primarily in Colorado, take place throughout the Western United States. 2016 January – May Total Income of $1,828,790; SDE for the same period of $328,459 – both up significantly over the same period in 2015.
Purchase Price………..TBS
 Down Payment……….TBS
 Gross Sales…$3,669,530
For more information,
contact Lynn Lage
Manufacturing / Fabrication – Sales are Climbing! #2615
Located on the Front Range, this solid, well established opportunity is well known, primarily for manufacturing architectural woodwork and cabinetry for mostly commercial applications. The company currently has a backlog of approximately $350,000 and sales are on target for an exceptional year in 2016! The experienced team will be an asset to the next owner, with the two key employees having over 15 years of experience with the company. All employees have been with the company for a minimum of 7 years. They design, build, deliver, and install custom millwork for numerous general contractors, banks, hospitals, office buildings, etc. It is believed that the best candidate for this acquisition will be an entrepreneur with a good business background.  
Purchase Price……$1,000,000
 Down Payment……$250,000
 Avg. Gross Sales..$1,124,078
Avg. SDE……324,944   
For more information,
contact Kim Hoyal