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Fernando Simo's Blog (20)

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Selling or Buying a Business??--the Law of Supply and Demand applies

As the economy slowly recovers, buyers’ confidence level increases and with that comes a greater demand for businesses available for sale.  Buyers, who were waiting for the bottom of the recession to hit prior to making a decision on buying, now find themselves competing for quality businesses in this market.  However, as can be…

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Added by Fernando Simo on February 14, 2011 at 4:31pm — No Comments

Selling or Buying a Business??--A Testimonial

In my last blog, I mentioned that Business Brokers add value to the process of buying and selling businesses.  This week, I would like to share with you a testimonial about our services from a recent buyer.  Indeed, we, the Transworld Business brokers, can change someone’s life and make dreams a reality as we go about our job in “adding value to the process.”  

TESTIMONIAL

December 2010

 

Testimonial…

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Added by Fernando Simo on December 20, 2010 at 12:21pm — No Comments

Ways to Increase the Value of your Business

Unfortunately, sellers often ignore one very simple truth: The value of their business increases in direct proportion to the buyers’ decrease in risk. I think this is a very important element of valuation and, as such, should be very well understood by those looking to sell or currently selling their…

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Added by Fernando Simo on August 11, 2010 at 2:53pm — No Comments

Buying a Business??--Why Sellers Sell their Business.

Recently, I was having a meeting with one of my network colleagues. During our conversation, she pointed out how leery she was of businesses for sale. When I asked why, she indicated that if the seller wants to sell the business is because it is not doing well. I found her response interesting and immediately indicated to her that sellers sell for a variety of reasons, most of which are not…

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Added by Fernando Simo on April 15, 2010 at 6:20pm — No Comments

Using 401K funds to Buy a Business

How would you like to buy a business using 401K funds--without any tax penalties? The purchase would leverage the government's taxable share of your 401K--therefore lowering your risk--and be effectively tax free on its operating profits. Should you want to know more, please contact me at 407-361-8886 or email me at fsimo@tworld.com. Also, please click… Continue

Added by Fernando Simo on March 6, 2010 at 12:00am — No Comments

Selling or Buying a Business??--Is there an Economic Upturn?

There is no doubt that a major topic of discussion (and concern) today for most of us is the economy. One of the main issues regarding a market where unemployment nears ten (10) percent (or 20% for those who include workers who no longer submit claims or are simply working on a part-time basis, or simply gave up), is whether the recession and/or the recovery is underway. Based on…

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Added by Fernando Simo on February 9, 2010 at 4:38pm — No Comments

Selling your Business?--What Happens after you Sell it?

Ok, so you are lucky enough to have sold your business. Now what? One of the things sellers normally forget is the closing process. In one of my previous articles I mentioned that among the many things Business Brokers do for sellers and Buyers is to manage the closing process once a Purchase Agreement (sale) has been made. As brokers, we normally manage three (3) key areas after a Purchase Agreement has been signed: The Due Diligence, Lease Assignment and Closing Process.



During Due… Continue

Added by Fernando Simo on January 4, 2010 at 6:28pm — No Comments

Selling your Business??--Get it Pre-Qualified!!

As I mentioned in one of my previous blogs, the Small Business Administration (SBA) has relaxed some of their policies in regards to lending. I said before that they “became a lot more flexible by making changes to the acquisition policies impacting purchases which included Intangible Assets. These changes give “Preferred Lender Providers” (PLP) more flexibility to provide business loans WITHOUT going through the SBA for final approval. In addition to providing PLPs with greater flexibility,… Continue

Added by Fernando Simo on December 2, 2009 at 9:16pm — No Comments

Buying a Business??--What I recommend foreign buyers to do.

Many foreign nationals come to Central Florida to purchase a business in order to get visas into the US on a somewhat permanent basis—so long as the business is viable the visa holder may stay, if not, they may have to get back to their country of origin. The two most common types of visas are the L1 and E2 visas.



The L1 visa is normally available to foreign business owners who wish to acquire a business in the U.S. and assign a person-- on an inter-company transfer—to manage the… Continue

Added by Fernando Simo on November 10, 2009 at 7:43pm — No Comments

Selling your Business??--Consider an Exit Strategy

In one of my recent articles, I discussed profitability (Owners Benefit) as one of the key elements in determining a business valuation. I mentioned that if a business generate limited or no cash flow, it normally can only sell its tangible assets—receivables, inventories, furniture and fixtures and equipment.—for a nominal amount. Yes, you may get more than the book value, but I find it rare. Unfortunately, over and over again, sellers come to me wanting to sell their business at a point of no… Continue

Added by Fernando Simo on November 4, 2009 at 8:26pm — No Comments

Selling your Business??--Can you sell something with no value??

As I go on listing appointments, I caution sellers that there are two ways in which one can normally value small businesses (notice the word “normally” and “small”). One way values Tangible Assets, such as inventories, receivables, furniture, fixtures and equipment. The other uses a multiple of Owners Benefit (Operating Profit plus owner’s salaries, depreciation, amortization, interest and personal benefits charged to the business). In other words, if your business generates minimal or no… Continue

Added by Fernando Simo on October 21, 2009 at 11:03pm — No Comments

Learn from those who lost it all—Perform a Due Diligence Prior to Closing on a Business Transaction!!

It’s the same old story. A buyer enters into a Purchase Agreement to buy a business, normally with a provision to conduct a due diligence within a 10-15 day period and, (guess what?) fails to do so. As a result, the buyer goes to closing, signs all of the documents required to transfer ownership only to find out later on that what he bought is not what he expected. As a result, the new business owner losses, in most cases, all of their liquid assets. It is a story which I find repeating all the… Continue

Added by Fernando Simo on October 16, 2009 at 10:01pm — No Comments

Selling your Business??—Why it makes sense to provide Seller Financing in this market.

Let’s face it, many buyers today are hindered by their ability to buy because banks are unwilling to provide business loans to the extent of a few years ago, if any at all. It is, to say the least, difficult to get financing. As a result, sellers have now replaced banks by providing Seller Financing. In this market, if sellers failed to do, they may not be able to sell their business or it may take years in which to do it. Here are some reasons why sellers should provide… Continue

Added by Fernando Simo on October 9, 2009 at 8:59pm — No Comments

Selling your Business??—Focus on your Business, Outsource!!

During one of my listing appointments, I met a seller who wanted to sell his business in order to improve the quality of his life—he wanted to spend more time with his family. According to him, he spent over sixty (60) percent of his time doing things that had nothing to do with the actual operations of the business—the back office stuff.

He complained that the forty (40) percent he spent focusing on his business, although enjoyable, was not enough to provide the kind of bottom line… Continue

Added by Fernando Simo on October 9, 2009 at 8:52pm — No Comments

Selling your Business??— How do you know when to sell your Business??

During the week, I had a discussion with a very talented individual whose job is to help businesses “get well” financially through leadership development. He asked for my opinion regarding valuation and exit strategies. The essence of his question dealt with a topic in the mind of many-a-business: when can I sell my business in order to get the most value?



Now, I know that many of my colleagues may have their own answer to this question. However, I gave him a very simple answer:… Continue

Added by Fernando Simo on October 9, 2009 at 8:49pm — No Comments

Selling your Business??--Cheap isn't always a Bargain!

What is it about most of us who decide that “cheap” is better? We do it when buying clothes, shoes, furniture, car, etc, only to find out, in most instances, that our decision was not a good one. Why?? Because in the very short term, clothes look like hell and soon deteriorate, shoes fall apart and last only a few months, and our furniture rips apart easily, forcing us to go buy the same things within months-- doubling our expense!! We do the same when buying a house. We forgo the best… Continue

Added by Fernando Simo on October 8, 2009 at 7:00pm — No Comments

Buying a Business??--Now is the time!!

In one of my recent articles, I discussed the impact the current recession has had on the Business Brokerage world. I indicated that one of the major reasons for the negative impact has been the inability of buyers to get financing to purchase a business, particularly larger businesses-- I recently heard that the average price reduction in Florida businesses sold over the last two years, compared to the previous two years, is between $150-$200K.



Now for the good news! The light at… Continue

Added by Fernando Simo on September 15, 2009 at 6:30pm — No Comments

So you’re selling your business—ARE YOU “IN THE BOX?”

Last week I talked about the Selling Criteria or areas that can make your listing a lot more competitive, such as good financials, proper documentation (such as lease and franchise agreements), equipment lists and others. These are areas that brokers look into to determine how viable and competitive your listing is—the probability of success.

During my discussion last week, I purposely omitted two additional elements (c’mon, I don’t want to tell you all in one week!!): Price and Seller… Continue

Added by Fernando Simo on August 21, 2009 at 8:00pm — No Comments

Selling your Business and the power of Competition—THE SELLING CRITERIA.

More than ever before, the selling of your business has become extremely competitive. As a seller, in this market, you are competing with a greater volume of similar businesses for sale, buyers’ investment choices in this very tight and limited financing environment and, most importantly, the brokers’ time and involvement in your listing.



Here, I would like to focus on the latter—the brokers’ time and involvement in your listing. By the way, by “broker” I do not mean the person who… Continue

Added by Fernando Simo on August 21, 2009 at 8:00pm — No Comments

Buying a Business??--So you want to Buy a Business, Heh??

So you made the decision to buy a business. Now what?? Well, to begin with, I would recommend you get the services of a business broker to help you find the right business—it is FREE. Just like in the real estate market, brokers get paid a commission from the seller not the buyer AND, in most cases, the broker represents the transaction—where he is not an agent of either the seller or the buyer. Secondly, I would really give a lot of thought as to why I am buying a business. Do you need to or… Continue

Added by Fernando Simo on August 21, 2009 at 8:00pm — No Comments

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