Finding the right business and business services professionals is always challenging for the buyer. All business buyers are interested in buying a business that has good cash flow and is profitable. Bizworldusa is an interactive website offering business for sale advertisements; a prospective buyer can easily find desired businesses which are available for sale. You can search with different criteria such as keyword, geographical location, price, and type of business etc. The majority of business for sale advertisements have sufficient information with audio clips and video clips to help you narrow down your search.
We are also offering a buyer resource column, broker directory, franchise directory, and business intermediary professional’s directory which may help you or assist you with your business requirements. Bizworldusa making available some model business documents, flow charts, changing of ownership information and other business related subjects, which may help to you find the right solutions for your business needs. Some legal and business associates have published a blogs and articles for the benefit of the business buyer; a prospective buyer can contact them if you desired to get further help from them.
Bizworldusa is a user friendly web portal with 24/7 accessibility that allows you to navigate and search for business for sale advertisements, franchise opportunities and professional business services. We think that Bizworldusa is the best business web portal as it has excellent tools tat allows you to get maximum benefit for your time.
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Any person or entity who owns a business can sell the business for several reasons, such as:
Since there are so many possible reasons that why a business may be listed for sale, the prospective buyer not only has to evaluate the financial situation of the business, but also must understand why the business was listed for sale. This process will help the buyer evaluate the possible risk of buying the business.
There is no best time to buy a business. Purchasing of a business is a personal or family decision such as when to buy, where to buy, why to buy etc. However many business purchase analysis reports show that most business buyers have some kind of working experience with or exposure to some type of business similar to the business that was purchased.
Buying a business can lead to financial freedom. Owing a business is a one of the best ways to achieve financial security. You will operate the business according your ideas, and that may bring a cash flow to achieve or fulfill your dreams.
Business success has many components. One of the keys of success is Pride of Ownership. A successful business owner is happy when the business is operating successfully. Cash flow is very important whether you run the business as a sole proprietor or have employees. The chosen business must have a positive cash flow as such cash flow must be sufficient to pay all your current bills and provide income for yourself.
Beauty is in the eye of the beholder. A case study shows that there are specific businesses that are more successful than others - even in the same industry. Most of the prospective Buyers want to own a profitable and well-managed business in the business industry that holds a personal interest for them. On the other hand, some prospective Buyers may look for opportunities that offer turnaround potential where they can apply their special skills. Your financial advisors or brokers can help you to choose a business that matches your interest and abilities.
You can buy almost any business that is for sale. However the prospective buyer should only consider businesses that he or she will feel comfortable owning and operating. You must also consider how much time and effort you are willing to contribute to the business you are considering purchasing, the amount of required investment, your risk tolerance for the business, nature of the business, viability of the business, rate of returns, and your experience in this type of business etc.
The first and foremost step is to talk with your family members and discuss why you are planning to buy a business. Family approval can also bring the family support to help to run the business. Your family members may also have new ideas for your business which could lead to increased cash flow.
It is always to be good idea to talk with your financial advisers such Attorney’s / Financial Planner/ CPA etc regarding the purchase of a business. They can evaluate your financial needs and also they may be able to help to find available cash sources needed to buy a business. Your advisers can also point out any areas of concern about the business you are considering purchasing. Professional advice should make you more comfortable and confident in your decision to buy a business.
Yes, you can and you have every right to start a new business. However in order to start a business you need to identify the location, get a master lease, apply for the necessary permits, apply for the licenses, and have enough cash to improve the premises. This process takes anywhere between 3 to 6 months time. In some cases you may not get all the permits and licenses as government entities are selective and zoning or area restrictions may apply. A newly opened business requires 8 to 12 months or even more to establish good sales, whereas an existing business has a proven track record. The failure rate of small businesses is largely in the start-up phase. Existing businesses have demonstrated that there is a need for their products or services in a particular area or locality.
Financing is also one of the key factors to consider. Financial institutions are reluctant to lend to a new business as there is a higher risk involved. An existing business has a proven track record that a financial institution can you use to approve a lending decision.
Brokers are Qualified and Licensed Persons / Entities who are specialized / authorized to conduct the buy / sell/ financial transactions. They conduct the business transactions very professionally and legally. They can provide / assist with all kinds of services such as selection of the business, writing the contract, helping provide the requested information from the seller or other broker, getting the licenses and permits, providing the right place to complete the transactions to protect your funds, transferring the business by coordinating with all parties etc.
Brokers are an excellent source of information about the businesses as they are familiar with markets and can advise about the trends, pricing, local area changes, etc.
It is always to good idea to hire brokers who have specializes in the particular type of business that you are interested in buying. A local broker will have more knowledge about local business sales and the local market trends. Read the profile of the broker and also make sure the broker has a current license. Once you narrow the list of possible brokers, talk with them and make your selection. Before signing any documents get a copy of the license and E&O insurance. It is very important make to get copies of all signed documents and keep them in as safe place.
It is not required to use an attorney; however it is always good to get an opinion from your attorney about all contracts, leases, franchise agreements, oil supply contracts, indemnity contracts, assumption of existing notes, seller carry notes, reviewing of CC&Rs etc. This service will cost money but their advice can help you avoid future problems and keep you more confident and comfortable during the process of buying a business. The attorney you hire should specialize in business contracts.
Unless you feel that you are capable to review the seller’s financial information, you should hire a CPA. A CPA/ Accountant can review the seller’s Federal Tax, State Tax, Local Tax, VAT, UST, other taxes, invoices, balance sheets, profit and loss statements, point of sale reports, etc. This service will cost money however their opinion/ review will help you understand the profitability and risk of the business opportunity. This gives you assurance about the business cash flow and may also help to determine the value of the business.
Both are interlinked relation but both have different definitions. The Business worth is a market value of the business as determined by an Appraiser / Broker Price Opinions / Other Valuation professionals based on the combination of Tangible and Non Tangible assets. Value is the income generated by the particular business without considering the fixed assets. Surprisingly in the market it is very common to see a business value that is more than the business worth and vice versa.
If you have broker, ask him to write an offer with all of your conditions and submitted to the seller with all necessary documents.
FMV is the value of the business in the current market. To know more about the FMV, CASH FLOW, VALUATIONS, WORTH, please read the business valuation column where you can obtain detailed information.
This legal mutual contract creates a confidential relation between the two or more parties / entities/ or both to exchange the confidential materials, knowledge, business secrets etc. This protects all parties from misuse of the received non public information.
Some brokers use a non disclosure agreement (NDA), which is similar to a Confidential Agreement (CA)/ Confidential Disclosure Agreement (CDC) / Proprietary Information Agreement (PIA), or Secrecy Agreement (SA).
These are the common reasons why the Sellers / Brokers want to sign the NDA/ CA/ SA/ PIA etc.
An investigation or audit by the buyer / buyer representative. Due diligence serves to confirm all material facts in regards to a sale. This a systematic and professional investigation process which includes both quantitative information, such as daily sales, monthly sales reports, invoices, paid in, paid outs, monthly, quarterly years taxes, local, sales, vat, block, state, federal and other related tax data and qualitative information, such as an assessment of the existing management, operations, existing licenses, permits, violations, zonal changes, lease , etc. This is a process of acquiring and analyzing information by the buyer or buyer’s agent to help you decide whether or not to proceed with a proposed business purchase transaction.
As per your contract you have to open an escrow and deposit the funds as per the contract. Apply for the license and permits as per the business requirements and coordinate with all person concerning the business such as appraiser, attorney, lender, CPA etc. Once every thing is ready, the escrow will prepare the necessary paper work to transfer the ownership to your name. As time is of the essence, all parties have to work in a timely manner to close the escrow.
EBITDA is Earnings before Interest, Taxes, Depreciation and Amortization
A common word used in the business industry which means Discretionary Earning (DE) or Seller Discretionary (SDE) which is an estimate of the total financial benefits of a full time Owner Operated Business on an annual basis. It can also be called Cash Flow (CF), Adjusted Cash Flow (ACF), Owner Benefit (OB), Owner Profits (OP) Recast Earnings (RE) or Normalized Earnings (NE), or Annual Earnings (AE). This is an important factor used by the Seller /Broker / Appraiser to determine the valuation of the business.
This is an amount of money required to buy / acquire the business Ownership. Currently there are two types available in the market.
Seller financing is usually the best, fastest and easiest to obtain. It also tells the Buyer that the seller has confidence in the business. There are no loan fees and the interest rate is usually higher than bank rates and the term of the loan is often shorter. Seller carry notes are the fastest way to close a business escrow and businesses closed in this manner tend to be successful.
Banks/ Financial Institutions will loan / lend money on businesses that show a strong earnings history on the tax returns. They require a lot of documentations and the payment of upfront fees. In recent years, the financial institutional has asked for additional collateral such as a real property in addition to business assets collateral. It is time consuming procedure but the financial institutions will investigate more thoroughly than most buyers to assess the risk of the business. Longer loan terms and lower interest rates are the advantages.
The most importance thing for business owner is bookkeeping. This not only tells about your business track record; you can also check or verify at any time to know your business direction. There is no law that requires a business owner to have a bookkeeper or accountant. That is up to the business owner discretion. Based on market surveys, the majority of successful businesses have bookkeepers / accountants. They are highly professional, maintain record of sales, invoices, profit and loss, employee payroll, inventory track, expense bills, etc. It is very important for any business to have accurate records. They can also represent you for all kinds of problems; also these records are needed to file your tax returns (federal, state, local, ust, vat, sales tax etc). Records are necessary to get credits from the vendors or loans from lending institutions. If you ever plan to sell your business, you will need the records to determine a FMV.
There is no special way to run your business in a profitable manner. However, the world business market analysis says there few common things that influence the success of your business.
Prepare a business plan and update it frequently.
Study the market trends and your competitors business. Make adjustments to your business based on your findings.
Most of the small businesses will be successful because of owner involvement. Spend some time each day to review your business operational methods and adopt changes as needed.
Attract customers by having well trained employees and maintaining a clean and attractive business premises. Treat the clients with respect and make them feel comfortable. Friendly customers are the repeat customers that all business needs to prosper
Escrow companies are licensed neutral third parties that help change the ownership while protecting the rights of both the seller and buyer. Sometimes an escrow company uses an attorney or broker to conduct the escrow services. They are familiar with all local laws, state laws, and coordinate with all parties involved in the transactions to close the sale. Escrow services cost money; however escrow protects all parties and provide piece of mind.
Down payment is the amount of the cash investment or injection by you in order to buy the business. This amount varies from transaction to transaction and the balance of the purchase price is a loan from a financial institution or the seller. Case study shows that the down payment amount usually is between 20 to 40% of the sale price.
It always good to pre qualify with a bank or other financial institution. Every seller wants to see that the buyer is serious. You will be reviewed by the financial institution and it will determine the maximum amount that they can lend to you. That information is necessary so that you only look for a business that you can afford.
Most of the sellers or brokers will return your calls or emails but here are few common reasons why they did not call you back:
To get further information regarding the purchase of business and related services please read our buyer resource column where you will get detailed information regarding buying a business. Also you can contact us by email at firstname.lastname@example.org. We can ask a Business Professional Advisor who lives in you area to contact you.