First Time Small Business Buyer

WHY BUY AN ESTABLISHED BUSINESS?The best way to answer this question is to keep it short, simple, and to the point!In most instances small businesses are acquired by first time business buyers. And this question comes up to them almost all the time. “Why not start my own from ground up?” Well, because it’s too risky! Buy an existing business, “because it is established,” you don’t have to start from scratch and advertise and hope to get clients. Most new businesses fail in their first year, and this is not news. Established businesses have a track record. When you buy an established business you’ll start profiting from day one. There will be no guessing, hoping, wishing, or waiting.When you buy an established business the previous owner trains and prepares you for that business. Because guess what? The previous owner knows how to squeeze every dime out of that business to maximize profits. More often than not, mandatory training is a contingency when you make an offer to buy an established business. Something that is very well worth to take advantage of and learn and ask as many questions as possible to insure future stability and growth.A PROFESSIONAL BUSINESS BROKERFirst time small business buyers have a much better chance of finding the right business if they team up with a professional business broker. It just takes a lot of the stress away. Your business broker will show you businesses, advise you, do market comparisons and come up with the real value of the business you are considering purchasing.But don’t be fooled. Finding the right business broker takes some homework. I recommend never to settle for less. Call and see at least a few business brokers before you make up your mind. Once you know your budget for your small business purchase ask the brokers if they will work with that budget. Sometimes they have general price ranges that they work between. For example, they only sell businesses prices between 500k to 5million. So in this case it is probably a waste of time to talk with them if your budget is 100k. And please try not to get stressed out in this entire process of buying a small business. It’s not as hard as it sounds. And in case you feel it’s not for you don’t be sad because it is not for everyone.HOW MUCH TO PAY FOR A BUSINESS?Since most of small businesses are sold to first time buyers, this is a question that comes up quite a few times. Most times even the owner or seller doesn’t know the true value of his/her business. They may say, “It has got to be at least 10 x my gross sales…,” or “I bought this business for this much, so now it has got to be worth this much.” These kinds of scenarios happen a whole lot. And it may not be the seller’s fault because that could be what they were told when they bought the business in the first place. So it’s fair to say that some sellers are completely out of touch with reality. But keep in mind that sometimes it’s possible to buy a business below its market value for various reasons. For instance; the owner want to get rid of his/her business and do something else, the seller has not consulted with a professional business broker, health reasons, emergency, hospital bills, other business ventures, etc… Below market priced businesses should accurately be investigate and appraised carefully to be able to figure out whether it is worth buying or not.With all of these things being said, no one should be confused about how much to pay for a business because there are industry standards and market comparisons. If you are someone who is working with a professional business broker then you probably should not have any problems appraising a business. Working with a professional business broker makes life a whole lot easier, and is something that I would recommend to anyone who is searching or considering buying a small business.PRICING NEGOTIATIONSThe endless inverse relationship between buyers and seller. But this does not matter to the informed buyer/seller. Meaning that if the seller/buyer did their homework and came up with the right market value price for a business then there is no further problems or questions. The considering party now know what the next step would have to be. That is where or not to accept the offer. My recommendation is to be true to the market and not waste irreversible time.Not knowing the current market value of the business is where the problems begin. For example; just because a seller is lowering the price doesn’t necessarily mean you are getting a deal, or let’s say as a business broker you appraise a business for “x” and the seller wants “y” amount and you take the listings in hopes that they will come to their senses and lower the price later.It’s not easy. But it’s the only way. “He said, she said, they think.” All that is nonsense. Don’t waste your time and get the true market value of the business. This will save a lot of time and nerves, and would make it easier to buy or sell.READY TO BUY AND RUN A BUSINESS?Of course the primary requirement to purchasing a business is financial ability. But let’s not leave another important factor alone. I’m talking about whether or not you have the ability to learn and run a business. It’s very different compared to just working for someone and getting a pay check every other week.You need to ask yourself these questions; Are you ready to make business decision on a daily business? Can you withstand the pressure of being responsible for everything? Because at the end of the day this is what it comes to. Do you have the ability to engage in effective communication with your vendors, staff, client, etc…? Are you computer savvy? Are you able to properly write emails? Are you on time? And many more questions like this.The fact is that you don’t have to be perfect at these things, but if you realize early on what you need to improve on or who you need to hire to help you, then you will save a lot of nerves and perhaps money and time. Being in business for yourself is not easy. But owning a business of your own is still a big part of the American Dream after all. And you should definitely be honest with yourself and follow your heart.BUSINESS GOALSThe point of being in business is to be profitable. There are many successful business models. Which one is the right one for you? This is a great question to ask yourself early on because time goes by fast and you don’t want to be jumping from one idea to the next. It’s always good to formulate a plan, one which is based on reality and availability. A lot of first time business buyers fail to buy a business because they wait too long for the right business to come along and eat away their savings and lose the ability to be a business owner because of this.There are industry standards to pricing most types of businesses. Once you know what type of business is most compatible for you, then at this point you may ask a professional business broker to assist you finding what you are looking for based on price, profitability, affordability, and location. It really takes the guess work out of figuring out what the market value for a certain business is. Once you are sure about what type of business to buy and the price you are willing to pay, then it’s just a matter of time to find it. Patience goes a long way, but being too patient and hesitating to buy at the right moment could become a problem because time may start eating into your savings and prevent you from buying any business.CONSIDERATIONOne great aspect to think about is your time. How much time do you want to spend on this. Are you a workaholic? Regular 9 to 5 person? Morning person? Evening person? These are all good question to ask yourself before you start your search. Do you know how you want to divide your time. It would be sad to get into a business and then figure out it’s not for you. Plus, know this will be useful in picking the types of businesses that might interest you.WORK AND TIME MANAGEMENTTime passes fast, but you already knew that. Are you getting the most out of your time? Are you involved in activities in your business that perhaps someone else can do for you? Do you trust your team? Are you addicted to controlling every aspect of you employees work? These are all good question to ask yourself, which in turn may save you some time so you can concentrate more on how to further develop your operations.A big part of success comes from having the right people working with you. You want to have people who are motivated, and not just doing the bare minimum. For this you need to take time to assemble your team based on stringent qualifications, and then treat them nicely and keep them motivated. Because if they see that they have a chance and a future with your company, they will most probably help you get to your goals faster with much less stress. When the right employee is treated properly, most likely he/she will go the extra mile for you every day.EVALUATE YOUR PHYSICAL HEALTHBeing in business and profiting from it is fantastic, and you must be physically healthy to enjoy the fruits of your labor. Evaluating your physical health condition is an absolutely critical issue when you are considering buying a business. Or if you are not healthy enough, is there someone that you like, trust, and capable enough to help you out. Again, you must be sure you have got this base covered just in case. Small business can be extremely fragile object to handle, and you need to do the job the right way.DISCLAIMER: The contents of this page are for entertainment purposes only. Please seek the advice of a lawyer/accountant/etc. before investing in a business. We will not be liable for the information displayed on this page in any shape or form. Buying a business involves risk.

Business Internet Banking – A Fundamental Requirement For Your Business

In this internet era when everything can be done online, banking is no exception to it. In fact, it is the one sector that has made remarkable advancement in this area. Now you can do anything and everything with your online event from anywhere and at anytime. You have 24×7 access of your bank account. The advantages of internet banking for personal as well as business requirements are obvious. Business internet banking is a fundamental requirement to start, grow, and manage your business. It is very crucial to offer internet banking services to your clients as it adds to their convenience. If you’re still thinking on shifting to online business banking, it’s high time that you just join the tide.In today’s competitive times, getting the right business internet banking services plays a crucial role in your business success. If you’re a small business owner, looking for a bank, financial institution, or credit union partner can sometimes be very frustrating. For small business owners, it is quite difficult to find a bank that can finance your operations as and when you need. Locating in a small town or far-flung area simply adds insult to the injury. In such a scenario, online business banking services can actually solve your problem and help you in getting required finance to grow and manage your business.Why to Set Up a Business Bank Account?Setting up a business bank account is the first and foremost requirement of small business banking. Using a personal bank account has its own disadvantages, as it does not help run the business as a business. It may reduce your expenses, bank fees, and efforts, but mixing personal and small business banking is certainly not a good idea. This may create many problems for your business in the long run.If you’re using your personal bank account for business transactions, it would be very difficult to convince financial institutions that you’re actually running a serious business. Banks, financial institutions, or government may think that you’re running a hobby business and that too on a part-time basis. This is one of the biggest disadvantages of not setting up a business bank account and using personal account for executing business transactions.Starting a new business is risky. Most people start it on a part-time basis and use personal bank accounts for making transactions. Later on, when they take over full time, then also they find it safe to transact from personal accounts which is not good. At the times, when you need to declare your income and expenses from the business, personal transactions cannot be shown. Here is when you get trapped. Accurate records can be shown only when you have a business bank account. If you don’t have one, get ready to experience tax-time nightmares.Importance of Business Internet BankingOnce you’ve set up your business bank account, it is wise to avail internet banking services. Business internet banking is a good option for those who have to make frequent transactions. Visiting a nearby bank again and again is not practically feasible. Along with this, having an online business account is beneficial as you can easily get loans from banks to manage your business as and when you want. It is easy to receive funds online than to actually cashing a check or draft. Even if setting up an account and availing online banking services takes time, have patience. It will simplify your business records as well as your life.

How to Motivate Your Sales Team So They STAY Motivated: Build a Foundation of Motivation

Do you feel that your sales team needs constant motivation? Do you feel you continuously have to pump-them-up just to meet minimum sales quotas? Of course, there is always a need for continuous positive and constructive input from sales management. However, your sales force should never become completely dependent on motivational food alone. When the team becomes hooked on the regular and excepted motivational high, they become like addicts who, without that fix, slip into the sales abyss.If you feel sales production rises and falls according to the amount of handholding or cheerleading time the sales team receives, then you need to build your team on a motivational foundation rather than motivational rhetoric.My team is already motivatedSome may be thinking, “My team seems to be as motivated as they can be and not always when I am around to pump them jump.” Many sales managers and directors believe that since the team seems to be moving right along; sales are ok, production is par-for-the-course and no one is complaining, then the team must be on track. Since you have received no criticism and no one has quit this week, then everything must be OK—right? The biggest sign of an under-motivated team is no sign at all. That is when you get a quiet, steady flow of the “Just enough to get by,” mentality and sales people who meander in a maze of mediocrity. Build on a foundation of motivation and reach new levels of production.Silent MotivationUnfortunately today, many sales managers believe that motivating a team means to engage the impressionable, unsuspecting souls in some ear-shattering, tambourine banging, adrenaline pumping rah-rah, you-can-do-it pep rally for an hour or two. While others feel that motivating is to utter the right words at the right time, lifting someone’s spirits after she has lost a big sale. Or, to deliver a speech at the sales meeting to fire the team up so they will believe they can do a little better this quarter than the last.While those thoughts have their merit, they are temporary and superficial. However, there are real, tangible, technical and structural measures that you and your company can take to help sales people develop true enthusiasm in their hearts, and a sense of self-motivation that will inspire them to greatness. True motivation comes from within.Below are three motivational pillars to build a foundation for your sales force. Concentrate on these three concepts, and the rest of your problems will take care of themselves! Be forwarded however, that these tips are probably not what you were expecting and some people are not going to take this very well. However, like most good medicine, it may taste bad going down, but it is what you really need.Pillar #1: Show Your Sales Team That the Company CaresContrary to popular belief, the primary motivating factor for sales people is NOT the money. It is true that most sales people originally join the organization they work with primarily due to the lure of money. However, the primary reason they stay with the firm is that they feel the company cares about them-personally. Prove to your sales team that you care about them: their personal welfare, their success. Let them know that you put their success before yours and the company’s, and they will stay motivated from the inside.Sales People Come FirstFrankly, as a sales manager, putting the sales person first, should be your personal philosophy anyway. If they fail, you and the company fail. Their success does come before yours. Often however, sales people feel as though the company puts everything and everybody before them. Many sales people feel the firm only cares about the money, and that they, as individuals, are as expendable as any tool or pawn. When people reach this low self-worth mindset, no amount of money, cheering or anything else will motivate them to reach high levels of success. To build on a foundation of motivation, first you must show sales people that the company cares, and note, I said SHOW them not TELL them.How to SHOW Your Firm CaresSo, how do you show, demonstrate or otherwise prove that the company cares for the sales person? In fact, how do you know if you are doing that now or not? Look at some of your organization’s policies and begin with your pay schedule. I am not referring to the amount you pay your sales people, nor the commission structure. The question is WHEN do you pay your sales people?In many an organizations, the sales person, who is responsible for generating the money in the first place, receives his or her pay (the commissionable portion) last. If your firm pays the receptionist, the secretaries, the cleaning people, the VPs, you, the CEO, CFO, CIO, and everyone else first, then pays the sales person out of the leftovers, you are not putting the sales person first. Now of course, one could argue that technically, everyone is involved in the sale, not just the sales person, and that is true. There is the CIO and the website that attracted the lead, the marketing crew that created the sales collateral, the receptionist who answered the call, shipping who got out the literature on time, etc. However, if that sales person does not go out and close the sale, the fact is, none of those people ever get paid. Look at your pay schedule, your charge-back rules, your benefits plan, the sales break room, your intranet. Look deep and be honest. Are you putting the sales team first?Pillar #2: Treat Sales People like the Executives They Are.Treat your sales team as if they are true executives; directors or CEOs and give them the support they need to perform as such. Create a sales support system that allows sales people to do what they need to do: SELL.In an effort to save money, too many organizations pile a bunch of petty, non-essential, non-sales tasks on the sales team. Someone figures that the organization can save $25,000 by NOT hiring an administrative person to handle some paperwork. Instead, “Let’s just have the sales people do it.” Well, you might save the $25,000 salary of the admin person, but you will lose a million dollars in the process. What is obvious and quantifiable is the time your sales people must spend doing things other than selling. What is much harder to calculate is the enormous loss you suffer due to the damage to the sales person’s psyche. How can you convince someone that they can go out and secure a seven-figure deal, when you have them doing four-figure work all day? Give your sales team a support system and staff so they can spend 90% to 95% of their time on income producing activities, and they will feel like executives and you will see motivation from within.Pillar #3: Get Sales People Involved in Company DecisionsOne of the main reasons people become sales professionals is because they want to be in control of their destiny. Most sales people will tell you that feeling in charge of their income and controlling their fate is a driving force in their career decision.When a sales person feels that the company will do whatever they want, whenever they want, it’s all over. With total disregard for the sales person, the company makes blatant decisions that significantly and often adversely affect the sales person’s life and family. The sales person feels like they no longer control their own fate when they have no say in decisions. Also, keep in mind that every sales person believes they know more about the industry and what is going on in the field than anyone at the office or corporate. Whether that is true or not, the fact is the sales person’s primary security of being in charge of his or her fate is lost.Before any major or reasonably significant decision, meet with the sales team, individually. Let each know that their opinions and ideas count. This does not mean that you have to agree or follow their suggestions. In fact, the sales team will be grateful no matter what happens because they feel involved.Build a foundation of motivation for your sales team:Show the sales team the company cares about them
Treat the sales team like the executives they are
Involve the sales team in company decisionsOnce you establish a motivational foundation, you will significantly decrease turnover, increase sales and maximize productivity. Then and only then will those rah, rah, you-can-do-it pep rallies begin to make sense, dollars and sense!