Ready to Sell the Business?

An old saying goes, “the two best days of owning a boat – the first, when you buy it and the second, when you sell it. The same seems to apply to some start-up businesses too.

As financial experts point out, a business can be sold only once. Even if a business owner has no intention of selling it at any particular time, there may come a time when it is imperative to do so and some plan to smoothen the process may have to be in place earlier. The preparedness such a plan provides may also help get a better price for the business when it needs to be sold considering the amount of hard work and effort that has gone into investing and running a business in the first place.

What it entails

The need is not to make a commitment to sell but to be informed about what is necessary and what it entails to sell a business. Some of the important aspects to be aware of and some upfront questions that are pertinent include:

• What is the business worth? – This is the first question every business owner has to ask and really evaluate. However, money should not be the only reason for selling because then it means that the owner is not exactly ready to sell and chances are that the business will be undersold. Having said that, whatever valuation is done by the owner, accountant or banker, only marketplace trends can really evaluate the current value of the business.

• Is the reason for selling a valid one? – Again there is a double-edged sword; if the business owner has a really solid reason it will most likely be sold. Here, the catch is to have reasonable expectations that increase the chances of the business getting a good buyer at the price expected.

If these two basic questions have been answered favorably, there are some important things about the business that require attention and putting together.
An initial checklist of the business and its operations should include:

• Profit and Loss statements going back at least three years
• Federal and Income Tax returns
• List of assets such as equipment and fixtures
• Lease related documents
• Details of loans taken, if any and repayment schedules
• If business is a franchise, terms of the franchise agreement
• Inventories of cash on hand, amounts to receive etc
• Details of additional investors or business associates, if any

It’s important to remember that any business, particularly a small one, has to make the right impression with the buyer. The above details help to provide a professional outlook and will go a long way in impressing a potential buyer.

In addition to presenting the business ‘well on paper’, an honest and sincere outlook and potential of the business also helps to create the right impression. Prospective buyers will certainly want to review income and expenditure figures but beyond that, the sustainability of the business and its pros and cons should not be ‘shrouded’. After all, no one will want to buy a business that will not provide a living; a seasoned business professional may have the acumen to see the potential and be willing to take a risk, but it’s impractical to expect everyone to have that view.
What next?

Once the selling has been figured out, it’s time to ponder on who could be a possible buyer. It could be a like-minded upcoming business entrepreneur who is looking for a chance to escape the ‘run-of-the-mill’ work atmosphere, a competitor or a large company looking to increase its business portfolio. No matter who the buyer is, knowing their aspirations and interest upfront helps to avoid long-winded negotiations and frustrating delays. Getting into a negotiation format with an entity that is not really serious about buying is a mere waste of precious time. This can be overcome by preparing a list of potential buyers amongst the circle of business associates and friends within the owner’s circle who is found to be capable of handling the business in a way that the business owner envisages.

That single aspect is enough to provide more satisfaction than the actual business sale.

The Commons Problems For Not Having a Business Plan and Why You Need One

I have been on countless Free business start-up courses, so I was quite clued up about the importance of creating one. However, the main point that all these courses stressed was that you needed a business plan if you were going to approach the banks or other organisations for financial assistant. The business plan would be my way of proving on paper how the business would be successful. The business plan would obviously include what the business was about, but most importantly to the investor that the business would work and that there is a demand in the market place for what I was offering, which would also include how much revenue I would generate based on research.

To be fair, if I was investing my hard earned cash into someone’s else business I would like to see what they are talking about in black and white, because some people have the gift of the gab but cannot deliver on what they say. So I understand the concept of needing a plan. However, a lot of start-up including myself was not looking for financial assistant from anybody, so I overlooked the importance of having a plan. Because I knew what the business was about and how much salary I wanted to earn each year I didn’t really see what the big deal would be if I just started without one.

Having a business plan does not guarantee success because they say that a high percentage of new businesses fail within the first year of trading. This could be due to many factors such as not making enough money, poor customer service, not keeping up with the latest trends or just simply trying to sell to the wrong target audience. On the other hand some businesses that have been around for many years and who started without a plan are now facing challenges within their business because they never documented how they would continue to achieve positive results when they left the company or even died. The business was then passed on to someone else to run who didn’t know what the business core values or vision was.

Writing a business plan can be pain staking boring and time consuming but having one in place comes with so many benefits which include:

· A document which outlines your vision.

· Helps you to be clear about where you are going and tells you if you are track.

· Obtain finances from the banks or investors

· Evidence that there is a need for your product and service and that people will pay for what you are offering.

· A document that can be given to someone else who will run the business just like how you envision it to be run if you left or passed away.

Last year I went to a business networking event and spoke to numerous business owners/entrepreneurs who said they were looking for more clients/customers. When I asked if they had a business plan 90% of them said that hadn’t. They obviously must have thought that just turning up to an event with a handful of business cards would be enough to generate more leads. How wrong could this be? Without a proper marketing strategy in place (which would be included in the business plan) their networking efforts could simply just be a day out of the office.

If you don’t have a completed draft business plan right now, I would encourage you to start creating one today. If you spend at least a couple of hours a week on each section of the plan, you will end up completing it in no time, plus you will be more clearer about the direction the business is heading!

Small Business Grants For Minority Business Owners

Setting up a business from the scratch can be a tough choice for enthusiastic entrepreneurs, especially if they fall in the minority section. Arranging for the funds and dealing with the expenses can be risky and daunting. The government has thus, initiated varied assistance programs for the minorities interested in small businesses, assisting and boosting them for their endeavor.

There are numerous plans, programs, monetary funding and aid for you under the Federal Assistance for Minorities’ Small Businesses. Go through the list and apply today to accomplish your dreams of having an independent career.

Financial Assistance for Minorities’ Small Business Owners

Firms and business owned by the minorities are offered financial aid in the form of loans, grants, counseling, assistance and training to help them run, expand and compete in the federal marketplace. The aid programs for enthusiastic minority business owners are listed below:

SBA 8(a) Business Development Program

The Business Development program helps firms to qualify by providing training workshops, counseling and technical and management guidance. The program also helps these businesses to compete in the federal marketplace by providing opportunities in the government contract space.

For program qualification some minority groups have already been categorized as economically and socially disadvantaged. These groups include:

• Native Americans

• African Americans

• Subcontinent Asian Americans

• Hispanic Americans and

• Asian pacific Americans

Apart from these groups, other individuals can also be considered for the program if they can provide substantial documentation and evidence suggesting racial discrimination and economic disadvantage.

SBA supports the certified firms by providing business development assistance. It also provides a Mentor-Protégé program which pairs the mentor firms with protégé firms so that mentor firms can provide assistance.

Small Business Administration’s Minority Owned Program

The SBA’s Minority Owned Program offers varied federal resources for the success and growth of your business. It helps in the initiation, financing for the startup, strategically developing and then the overall growth of business.

SBA’s HubZone Program

The program is engaged in promoting for the economic development and growth of underdeveloped areas through the expansion of small businesses in these specific sectors. It encourages in attaining more of federal opportunities and support if your business in located in these distressed areas.

Business Loans

Eligible women business owners, recognized by the government, can receive low-interest loans by SBA, provided they belong to the minority section. The loans are attainable even with bad credit history report and can be repaid after a long duration of time. Enthusiastic minority women can now avail the financial assistance for their startups.

USDA Grant

The U.S. Department of Agriculture (USDA) offers funding to grantees up to $150,000 in rural sectors through the Rural Business Opportunity Grant. The funds facilitate in providing technical and training assistance to nonprofit corporations and cooperatives for their business development and growth.

Georgia-Pacific Grant

The program, initiated in 1927, helps minorities’ small businesses to set off and expand eventually through the funding program. The grant program usually funds business plans, ventures or projects for entrepreneurship that benefits the lives of the community. Minority business owners with these criteria qualify for this program.

Amber Foundation Grant

The program is targeted towards women entrepreneurs seeking to venture into the business world and accomplish their dreams. Commenced in 1998, the program offers funds to commemorate the death of a 19 year old woman who could not fulfill her aspirations. Amounts ranging from $500 to $1,500 are granted to women from different cultural groups to cover the expenses of starting and setting up a business.

In addition to small business startup grants, minority business owners can also look for assistance from their individual state governments, nonprofit organizations and government accredited agencies to kick-start their business. Make the endeavor with the finances available for a successful venture.