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When It Comes to Selling Your Business, Let Others Do the Heavy Lifting

While brokerage professionals are working to sell your business, it’s important for you to keep your daily operations running as smoothly as possible. Sellers often make the common mistake of becoming distracted during the selling process and allow things to fall by the waist side. You’ll want to make sure everything remains the same, as prospective buyers will otherwise start to become nervous. Operating hours, inventory levels, and tasks such as keeping the premises in prime condition should remain unchanged. If any changes like revenue or sales decrease, that will raise a red flag for buyers.

Business brokers , M&A advisors, Attorneys and CPAs – anyone professional who may be involved during the sales process – will help tremendously with various details and events. This way, you can focus your energy on running your business, and they will continue to assist with the process from beginning to end.

Get Professional Advice on Pricing

You may have a ballpark figure of what your business is worth and an estimated amount you expect it to sell for. However, the truth is that you will only receive what the market will allow. Always obtain a professional valuation before providing a listing price. Over pricing the value of your business will certainly derail the process and potentially halt it all together. You want to strive towards successful results, not set backs.

Keep Things Confidential

Confidentiality will be an extremely important piece of the puzzle during this process, especially until your sales transaction has fully concluded. If your vendors and employees know that you are selling, it could lead to circumstances that are detrimental to the value of your business. Employees may begin to pick up on what is going on behind the scenes and opt to seek employment elsewhere. Similarly, vendors may catch wind of what is happening and choose to terminate their contracts if word were to get out.

Decide On Your Strategies

Think about how willing are you to stay for a designated period of time after your business sells. Weighing this decision tends to help increase the amount you receive for your business, as many buyers will hold you as a valuable asset as a reduction in their risk and often increase their offer. Another thing to consider is offering seller financing. Similar to sticking around, buyers will view financing as a sign that you believe in the future success of the business.

Prepare in Advance

It’s always best to prepare when you are not experiencing external pressures. Unfortunately life is unpredictable and any event could cause you to sell at an unexpected time. Factors to consider are making sure, years in advance, that your bookkeeping and paperwork is kept up with. This would include organizing documents or handling any litigations and environmental issues. As mentioned above, selling a business can be highly distracting for business owners.

A prime reason for business owners is to start talking to an M&A advisor or a business broker a few years in advance. That way they can make sure everything is optimized for positive results.

Copyright © 2022 American Business Acquisitions, Inc. 

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What Do Buyers Really Want?

When sellers get ready to put their businesses on the market, they often wonder what buyers are really looking for in an effort to make their businesses as attractive as possible.

The answer to this question can seem mysterious when you are on the other side of the bargaining table. So, what are buyers typically thinking about when they make the decision about whether or not to purchase a business for sale in Illinois? It should come as no surprise that much of this is tied into earnings and stability.

Guarantees of No Surprises

Earnings that are sustainable are very attractive to buyers. After all, it allows them to know what to expect. Buyers can then factor in if they can advance the business in a way in which it would grow faster than the current pace.

If not, they at least would have the confidence to know that the business will proceed at the same rate. Of course, no buyer would want to acquire a business only to find that it only had high earnings temporarily due to a one-time contract.

Accuracy of Information

Along the same line of avoiding surprises, buyers will want to verify the information they receive about a business. Anything involving past, present, or future legal issues will be scrutinized along with other issues, such as pending product returns. The due diligence process is when you can expect the buyer to really dig into the details of your business. You can expect that he or she will often do so with the assistance of an attorney and accountant.

Oftentimes, accountants or appraisers add back one-time expenses or non-recurring expenses. Buyers will want to look at the earnings and have proof of expenses that are non-recurring, such as fees for a lawsuit or heavy repairs to a building. Since this process inflates earnings, it can make it difficult for buyers to understand the actual earning potential of a business. Otherwise, those expenses would obviously throw off the true earning potential of the business.

In Closing

These are just a few of the critical considerations made by business buyers when looking at a potential acquisition. There are numerous other considerations that a buyer will make, and it is important to be prepared to address those questions and potential concerns a buyer may have up front, or they will quickly lose interest and move on to other potential acquisition opportunities. Put yourself in the shoes of a potential buyer and think about the kinds of assurances you would want before buying a business.

Working with Business Brokers in Chicago or Mergers and Acquisitions Advisors can be tremendously beneficial in this regard. These professionals have worked with many buyers in the past, and therefore easily see things from a buyer’s point of view. They will not only be able to help you get prepared up front when buyers begin looking at your business, but easily identify and point out areas of concern that a potential buyer may have in order to keep the journey to closing on track.

Copyright © 2022 American Business Acquisitions, Inc. 

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Seeking Professional Help When Selling Your Chicago Business

When it comes time to sign on the dotted line while buying or selling a business in Chicago, you only have one opportunity to get it right. Many owners misvalue the worth of their business or don’t take the time to fully understand the process and preparation that goes into it. You may know a friend or even a relative who is able to help you navigate the waters, but it’s always to your benefit to seek professional help and advice. Here are some common mistakes.

Not Prioritizing Confidentiality & Financial Information

There are hundreds of Chicago businesses for sale, and at the top of the list are competitors wanting to gain access to valuable information, so keeping your confidentiality intact is detrimental to the successful sale of your business. Trying to endure the process on your own may make you susceptible to sharing your personal information with the wrong parties. Or in a worst case scenario, accidentally alerting employees, suppliers and customers that the business is up for sale. It’s critical these errors do not occur as to retain employees and not have the scoping out new job opportunities because the sale is taking place or to a rumor thereof, especially if it will not be affecting them. Should these occur, it could jeopardize the sale of the business and deface reputation. It’s equally as important to ensure you trust the parties that are assisting you in selling your business. If any of said parties lack experience, someone may accidentally omit preparing critical paper work or neglect to have financial records properly audited, which could negatively impact your numbers. This could lead to lower offers and less interest from prospective buyers.

Failing to Involve Key Parties

Owners have spent countless hours and tons of energy building their business into a thriving, salable entity. Successful business owners never cut corners on their way to this point, and it’s not time for them to start doing so now. In order to ensure that their sale goes smoothly and that they reap the benefits of their hard work, it’s essential to hire sell-side advisory services. Business Brokers in the Chicago area could likely tell you horror stories of the damage inexperience in the industry has done. Understanding the importance of bringing in key parties should again, not be overlooked by any means. When a business owner is guided by those who are not trusted professionals, there can be many miscommunications in involving key parties. While an error like this one might not necessarily kill the deal, it could lead to delays and complications.

The bottom line is that when it comes to a large transaction like selling your business, it is time to rely upon trustworthy professionals. There are countless protocols that go into ensuring a deal moves along and satisfies smoothly. Experienced business brokers and M&A advisors will make sure that all the best practices are followed and that you come out ahead in the end.

Copyright © 2022 American Business Acquisitions, Inc. 

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The Importance of Employee Happiness

Creating a Better Workplace Culture

There’s no question that employees are an integral part of operating a thriving business. Which is why keeping employees happy plays such a huge role in improving workplace culture, retention, and overall productivity. According to a study by the University of Warwick, happy employees are 12% more productive, which allows them to put forth better work quality and even increase their creativity. When your employees are feeling not only satisfied, but also valued, they will be more likely to keep your clients satisfied too. For each happy employee you have, the focus and engagement will continually increase, projecting onto your customer base. Of course, there is also an opposing side to this. If some of your team members feel frustrated and angry, their actions can drive away your customers and clients. If you are looking to sell or operate your business for maximum revenues, it is a good idea to also maximize employee satisfaction levels as well.

Employee Benefits & Retention

It goes without saying that employees will be more likely to feel satisfied when they feel that their salary and benefits are fair for the work they do. If they are resentful about the compensation they are receiving for their work, this will ultimately impact their performance. Employees who report higher levels of stress are more likely to be absent from work, take longer breaks during their shifts, or even quit their jobs altogether. Listening to employee concerns and consistently conducting one on one meetings to check in with them is extremely important in keeping the lines of communication open. This way your people will be more likely to come to you when they’re stressed or facing a problem. When you think about some of the most successful companies, you realize that many of them invest substantially in supporting their employees to cultivate higher levels of employee satisfaction. For example, Google is well-known for offering a wide range of perks from parental leave and paid time off to free lunches and fitness facilities. Putting forth this extra effort will really go a long way when it comes to retraining not only employees in general, but especially the most talented ones.

The Customer Experience and Company Longevity

Happy Employees = Happy Customers. Those who feel valued are more likely to exhibit happiness and deliver great customer service. When you exhibit good leadership and act as a positive role model, your employees will likely follow suit. When you know your team members are struggling, provide them with resources such as training in resiliency, mindfulness, and cognitive-behavioral techniques and don’t forget to recognize a job well done! Employees should be acknowledged and rewarded on a regular basis. In some cases this may be a financial bonus, but even sending them a personalized note or acknowledging their work within a team meeting will go a long way in cultivating a positive company culture while boosting morale. This will ultimately contribute to your company’s overall ongoing growth and development for the future.

Copyright © 2022 American Business Acquisitions, Inc. 

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Important Points for Selling to a Family Member

Every business owner will eventually have to turn over control of their business to someone else. There are many avenues for how this can happen. They range from selling to a prospective buyer, selling to a competitor, or turning the business over to a family member. The key is to start thinking about all of these options for several years before you end up in a situation where you are actually forced to sell.

Working with a Business Broker at American Business Acquisitions in the greater Chicago area can help you determine what sales options are optimal for your specific situation. To help shed some light on the options above, here are some variables to explore when you decide to transfer your business to a family member.

Tax Advantages 

There can be significant advantages when transferring a business to a family member. Without a doubt, the top advantage is the fact that the transfer can be considered a gift. This approach will help reduce your real estate taxes. You might also be able to maintain some control over the business as well, depending on how the agreement is written. For many business owners, this factor can be a big advantage.

Seller Financing 

When transferring a business to a family member, one item you’ll want to explore is seller financing. This is a common practice in general, although it is even more common when transfers to relatives are concerned.

Seller financing is a versatile option of implementing a private annuity. A private annuity can spread payments out across a long period of time. This option can be a win-win situation for both you and your relative. This would ensure a long-term stream of income as a result of ongoing payments. In turn, this decision might make ownership more financially realistic for your relative.

Legal Agreements  

It Is important to keep in mind that selling to a relative no way negates the need for a buy-sell agreement. Even when you’re dealing with your most trusted family members, having a legal agreement in firmly in place is a must. This is an invaluable tool that protects everyone involved.

A buy-sell contract will clearly outline all aspects of the arrangement. This agreement should include the value of the business, amount being paid, information on which employees will be retained, the current business owner’s level of future involvement, parameters of financing, and much more.

Working with Professionals 

Ultimately, there is a spectrum of potentially powerful benefits that are associated with transferring ownership of a business to a relative. While you can expect the IRS to closely evaluate the sale, this should not dissuade you from considering this option. The Business Brokers at American Business Acquisitions are experts at buying and selling businesses, and they understand the specifics of transferring a business to relatives. Early on in the selling process, you’ll want to work with a professional to help you gain tremendous insight into the best way to proceed.

Copyright © 2022 American Business Acquisitions, Inc. 

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Disruptive Factors in Selling Your Business

Down the road, every business owner will need to entertain the idea about selling his or her business. When the time comes, you’ll need to be ready to tackle a range of obstacles, as the selling process can be both confusing and time-consuming. This is especially true for those who haven’t had to go through the process before. Here are some of the key reasons why deal can fall apart when you’re selling your business.

Psychological Factors

Just like sellers, buyers will enter the process with a wide variety of preconceived notions about how the process should work, as well as what they consider to be “a great deal.” The psychological factors when it comes to both buying and selling a business should not be overlooked. Sellers specifically need to understand the specific wants, needs, and desires of a potential buyer, as well as their own psychology.

Even serious buyers may have highly unrealistic expectations regarding various aspects of a business. This ranges from price to opportunities for future growth. In some cases, buyers may drag their feet due to the fact that they are not quite ready or have a sense of urgency to buy a business.

Buyers can also be influenced by outside parties, which could be from friends, family members, or advisors. In short, sellers may discover that buyers might actually be several people who are forming a collective opinion regarding the business.

Seller Psychology

A seller’s own psychology can play a major role in whether or not a business is sold successfully. Many sellers start the process without fully understanding what is involved. This factor, of course, highlights the tremendous importance of working with professionals for months, if not years, before you actually place your business on the market. The professionals at American Business Acquisitions can help streamline the selling process in the greater Chicago area and help sellers understand all aspects of what is involved.

Another major obstacle is that sellers often have unrealistic expectations about both price and the time frame it takes to sell their business. It is very important to enter into the selling process with open eyes and realistic expectations in place. This includes establishing a fair price, and understanding that it could possibly take up to a year before the right buyer is found, but that is very rarely the case at ABA.

Acts of Fate

Sellers should remember that there are many “acts of fate” that could disrupt a deal. It could seem as if everything is moving along smoothly, and at the last minute a buyer isn’t able to secure the funds needed to close.

All parties should understand that until a deal is finalized, any problem can still arise. In fact, they can arise from the most unexpected direction, but it is difficult to anticipate and spot every single potential disruption. The complexity of selling a business is one of the main reasons why so many business owners opt to work with an advisor at American Business Acquisitions.

Copyright © 2022 American Business Acquisitions, Inc. 

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How to Capitalize on Your Company’s Uniqueness – A Quick Guide for Selling a Business in the Chicago Marketplace

It is well known that the city of Chicago has a long history of industry and commerce, offering a business environment with natural competitive advantages rooted in its location, infrastructure and workforce.  Given the fact that there are more than 1.2 million small businesses operating in the state of Illinois, it is essential for small businesses to establish and market themselves with a niche or specialized foothold within their specific industry.

Although it’s not always obvious, every business is unique in one way or another.  Whether it be how long you’ve been in business, that the company has been passed down for generations, or because it’s located two blocks away from Millenium Park, there is some special aspect that sets your business apart from its competition.  Oftentimes however, these specialties aren’t promoted to their fullest potential. Although understandable, this oversight is a startegial error which can be especially costly during the small business acquisition process. As the business owner, you know your company better than anyone and being able to effectively convey these aspects to your broker will ultimately lead to the most profitable outcome.

There are of course many unique attributes of a company which can make it more attractive to a possible acquirer. This fact is especially true in the saturated Chicago business listings. Certainly, the numbers are important, but potential buyers will look beyond the figures alone. Factors that make your company special or unique can often not only make the difference in a possible sale or merger, but also can dramatically increase value. Review the following to see if any of them apply to your company and if they are transferable to new ownership.

Brand Name or Identity

Does your service line have a recognizable name? While it doesn’t have to be Sara Lee or Quaker Oats, a name that is well known within a specific geographic region, or one that is identified with a specific product can be extremely advantageous. A product with a unique appearance, taste, or image is also a big plus. For example, Uno Pizzeria & Grille has a unique regional identity, and also a distinctive taste. Both factors are big pluses when it comes time to sell.

Dominant Market Position

A company doesn’t have to be a Fortune 500 firm to have a dominant position in the marketplace. Businesses who are major players in a niche market are in a dominant position as well. Possible purchasers and acquirers, such as buy-out groups, look to the major competitors in a particular industry, regardless of how small it is.

Customer Lists

Maintaining an accurate and current list of customers is important as it can be a valuable resource in many aspects of your business. Not only can it provide leads for sales, a group for testing new products but it can also become an effective method to provide positive customer feedback and social media promotion. Newsletters and other publications have, over the years, built mailing lists and subscriber lists that create a unique loyalty base. Just as many personal services have created this base, a number of other factors have contributed to the building of it. The resulting loyalty may allow the company to charge a higher price for its product or service.

Intangible Assets

A long and favorable lease (assuming it can be transferred to a new owner) can be a big plus for a retail business. A recognizable franchise name can also be a big plus. Other examples of intangible assets that can create value are: customer lists, proprietary software, an effective advertising program, etc.

Price Advantage

The ability to charge less for similar products is a unique factor. For example, Wal-Mart has built an empire on the ability to provide products at a very low price. Some companies do this by building alliances with designers or manufacturers. In some cases, these alliances develop into partnerships so that a lower price can be offered. Most companies are not in Wal-Mart’s category, but the same relationships can be built to create low costs and subsequent price advantages. 

Difficulty of Replication

A company that produces a product or service that cannot be easily replicated has an advantage over other firms. We all know that CPA and law firms have unique licensing attributes that prevent just anyone off of the street from creating competition. Some firms have government licensing or agreements that are granted on a very limited basis. Others provide tie-ins that limit others from competing. For example, a coffee company that provides free coffee makers with the use of their coffee.

Proprietary technology

Technology, trade secrets, specialized applications, confidentiality agreements protecting proprietary information – all of these can add value to a company. These factors may not be copyrighted or patented, but if a chain of confidentiality is built – then these items can be unique to the company.

As any seasoned business person will testify, selling a company is one, if not the biggest deal of a professional career. Countless hours have been poured into cultivating a company with unique service and offerings, so when it comes time to sell, it’s crucial to entrust in a Chicago business broker who is not only well versed in local market, but also one who appreciates your company’s unique attributes and the nuances of the industry it serves. By understanding these industrial strengths, your broker will be better able to maximize valuation and make the selling experience not only smoother, but one that is more financially advantageous.

For a free consultation on selling a business or hiring a business broker in Chicago or across the State of Illinois, please schedule a virtual meeting using http://calendly.com/abameeting or contact us to find out how we can help you achieve the highest value and close on the sale of your business or company.

Copyright © 2021 American Business Acquisitions, Inc. 

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Put Your Strengths First When Selling Your Business

No one understands better than you do, the finer points and potential of your business; however, that doesn’t mean that prospective buyers will have instant awareness of your business’s various strengths. When you are looking to sell a business in Chicago or elsewhere, you now have two very important jobs. First, you need to prepare your business to be fit for sale. Your second essential job is to showcase your business’s greatest strengths. At the end of the day, articulation as to why your business is worth buying, must come from you. At American Business Acquisitions, this effort, of course, will be supported by our highly qualified Chicago Business Brokers and M&A Advisors.

Understand Who Will Buy Your Business 

Most people are vastly inexperienced when it comes to selling a business or have never sold a business. They don’t fully comprehend what is involved in positioning one’s business for sale. The bottom line is that not every business is a good fit for every buyer. Intuitively analyzing candidates to locate the right buyer for your business will efficiently expedite the process. Yet another compelling reason working with experienced business acquisition professionals is critical. A skilled business broker or M&A Advisor will not only know what buyers are looking for, but also what sellers need to do to get their business ready to sell.

How to Navigate Roadblocks 

Selling a business, especially if you attempt to do so without the guidance of professionals experienced in Business Acquisitions, can be an energy draining, and certainly, time consuming process. Successfully running a business requires attention to detail and razor focus. Unfortunately, these can both be compromised when owners attempt to put on yet another hat and handle the sale of their business on their own.

While you are attempting to sell your business, it is critically important that you maintain the current standard of operations. The last thing you want is to risk weakening the finances of your business while you are waiting to find a buyer. Keep in mind it takes months, a year, or even longer to find a buyer for the typical business. While at ABA we have a much more efficient process in most cases, during he sale prices it is key not to allow for deterioration of your business in the interim.

Think Like a Buyer

Preparing your business to be sold isn’t as simple as making a few cosmetic changes and calling it day. Instead, you’ll want to think like a buyer.

What would you want to see if you were buying a business? Wouldn’t you be a great deal interested in knowing all about that business and how it operates? Who its key employees are? How likely those key employees are to stay, who the main customers and suppliers are, and the strength of the business location and competitors? Of course. You would also want a very detailed picture of the business’s financial situation.

In short, your interest would be to clearly understand what the business does and what it’s really worth. How financially healthy it has been in the past, what the business’ prospects are moving forward and, in general, how much effort the business will take to operate. These are exactly the kind of key facts that any seriously motivated and positioned buyer will want to know. It’s natural that a buyer would expect to learn this information before making a decision.

At the end of the day, working with a Business Broker or M&A Advisor is one of the easiest ways to streamline the sales process. Thanks to years of experience, they already understand Business Valuation in the Chicago market and beyond, the pitfalls that you may experience as well as what is needed to position your business so that you can find the right buyer quickly and receive the best price possible.

If you’re interested in hiring a business broker who services Chicago and the entire State of Illinois to help you sell your business or consult on an exit strategy, contact us here or schedule a free consultation by selecting a date and time that work best for you.

Copyright © 2021 American Business Acquisitions, Inc. 

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10 Mistakes that Sellers Make

If you’re selling a business, it’s important to understand the common pitfalls and mistakes sellers make so you can ensure a smooth and successful process. In this post, we outline the top 10 mistakes that sellers make:

1. Not knowing where to price the business

Not knowing the proper pricing for your business is one of the most common mistakes. Pricing the business too high or even too low can raise red flags that turn buyers away. Before making the decision to sell and placing on the market, it can be beneficial for sellers to work with a qualified business broker to price their company appropriately. An experienced business broker has both the technical ability and the market experience to produce the most realistic pricing.

Fair Market Value

Asking Price is what the seller wants

Selling Price is what the seller gets

Fair Market Value is the highest price the buyer is willing to pay and the lowest price the seller is willing to accept.

2. Not preparing the business for sale

Determining the price point is only the first step. Before selling a business, you should be as prepared as possible with current financial, legal and operational information for potential buyers to review. You can expect buyers to want to see this information and having it ready will make the business appear more organized. Demonstrating preparedness places the business in a favorable light, while being unprepared can delay the selling process and turn buyers away.

3. Not being able to see the business from a buyer’s perspective

As the owner of a business, it can often be difficult to step outside and see the business from the buyer’s perspective. It’s natural to view your own business in a favorable light and overlook problems and issues, however your ability to do this could help you sell your business faster. You have to approach selling your business realistically, knowing that a potential buyer will be looking for the negatives as well as the positives and weighing those circumstances. The ability to not only recognize flaws in the business, but actually present them as areas of potential growth will make your business very attractive to a buyer.

4. Not knowing the buyer

By knowing the buyers, their motives, their interests and their backgrounds, the better equipped a seller is to make informed decisions about whether they are the right people to operate the business. Selling a business is bound to have challenges, however the better you know the buyer, the better you can anticipate their needs and concerns and have the necessary information available. The more you can understand the buyers motives, the better position you’re in.

5. Trying to sell to uninterested buyers

There are plenty of “potential buyers”, but the questions is, are they serious buyers? A potential buyer may display interest, but when it comes down to it, they may back out because they weren’t serious, have unrealistic expectations or only want to buy on their terms. Don’t waste your time on those who aren’t serious about purchasing a business, and save the energy for those who are.

6. Thinking you know it all

Many business owners think they know it all, that nobody knows their business like they do and will get caught up in trying to do everything themselves. They try to handle every aspect of the sale when in reality, it should be left to the lawyers, accountants and business brokers to work together to make a sale happen. When the seller doesn’t ask for help and the deal doesn’t go through, they will often blame others, but really they were their own worst enemy by trying to do it all themselves. Not using outside advisors, such as a professional business broker or intermediary, can be a serious mistake in achieving the highest value, etc.

7. Not understanding the structure of the deal

The price is only one piece of the deal – however many sellers will see the price on an offer and say “no” without understanding how the deal is structured. The structure of the deal is arguably more important than the price alone. The terms and conditions of the deal are where the negotiations can happen that allow for flex on the price.

8. Not being able to walk away from the deal

It can be easy to get so wrapped up in a deal that you lose sight of the big picture. You may not recognize when a deal is a “bad deal”, and when to walk away and move on in order to save your time, resources and sanity. Sellers don’t want a deal to get away, but in some cases this is what needs to happen in order to move on and find the right deal and the right buyer.

9. Waiting too long to sell

Too many owners wait until the last minute to decide to sell their business. They wait until business is down, or they are completely burned-out, or their business partnership has soured completely. The time to sell is before the emergency happens. The time to sell is when business is good. The time to sell is prior to when exasperation hits. The old adage is that a business owner should think about and plan the eventual sale of the business the day after it is started or purchased.

10. Changing your mind

One of the worst things you can do while in the process of trying to sell your business is change your mind. It happens more often than you think – just before closing, the seller realizes they don’t really want to let go of their business and backs out. This not only wastes time, energy and resources, but could also deter buyers away from your business in the future if you decide to sell again. Allowing the potential buyers to have full trust in you is a key to selling your business. Wait until you are absolutely sure you want to sell, that way you and everyone involved can feel confident in the process.

This is what business brokers and M & A professionals here at ABA deal with every day, equipping them to help you prepare honest and valuable answers. So if you’re interested in hiring a business broker in Chicago, the Chicago Suburbs, or the State of Illinois to help you sell your business or consult on an exit strategy, contact us here or schedule a free consultation by selecting a date and time that works best for you.

Copyright © 2021 American Business Acquisitions

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Top Questions Business Buyers Want Answers To

If you’re thinking about selling your business in Chicago or greater Illinois, it’s essential to know the questions business buyers will want answers to. For example, one of the more obvious questions is: “If this is such a good business, why is it for sale?”

Answering this question appropriately could be the key to making a sale (or losing one). If you give a vague answer, buyers may assume the worst and stop showing interest in your business. If you have owned your business for 10-15 years and are just ready for something new, buyers will likely understand. However, if you have only owned the business for a few years or less, that may raise some red flags to buyers of why you want to sell, so be careful how you approach this question.

A common reason for selling is because of health issues, and if that’s the case, it’s fine to be open about that with potential buyers, so they have a complete understanding of your reasoning. The worst thing you can do as a seller is giving vague answers or no answers, as buyers will tend to see that as a red flag and potentially walk away. Honesty is always the best policy.

Navigating selling your business or company can be challenging if you’re trying to do it alone, which is why retaining a business broker or intermediary may be extremely useful. Business transaction professionals have experience with all types of business opportunities, dealing with buyers and sellers, what information needs to be provided and have a handle on the entire business sale preparation and process from analysis to closing on the sale.

One of the most valuable insights a business broker can offer is how to address buyer questions, such as:

Why should I buy a business rather than starting my own?

How are businesses priced?

What does it take to be successful?

How long has the business been in business?

How long has the present owner owned the business?

How much money is the business making?

Are the books and records readily available?

Will the new owner help me learn the business?

These and many other questions are ones that business brokers and M & A professionals here at ABA deal with every day, equipping them to help you prepare honest and valuable answers. So if you’re interested in hiring a business broker in Chicago, the Chicago Suburbs, or the State of Illinois to help you sell your business or consult on an exit strategy, contact us here or schedule a free consultation by selecting a date and time that work best for you.

Copyright © 2021 American Business Acquisitions

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