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Exit Planning Insights
Highlight Your Company’s Intangible Assets When Selling
February 28, 2023 / in Business Valuation, Exit Planning, Sell a Business / by Al Statz
Intangible assets represent most of the value in almost all of the companies we sell, so it only makes sense that showcasing the intangible assets that make your company unique and successful can significantly impact your final transaction value. Here are some practical tips to help you leverage your intangible assets in a sale process. Intangible assets are non-physical assets such as contracts, customer lists, proprietary software, databases, designs, recipes, proprietary business processes, well protected …
“In God we trust; all others bring data”: A Due Diligence Survival Guide for Sellers
February 8, 2023 / in Exit Planning, Sell a Business / by Al Statz
“In God we trust; all others bring data” is a famous quote from W. Edwards Deming that emphasizes the importance of data analysis in business decision making. The due diligence process is a critical part of every M&A transaction, and in today’s data-driven world, having relevant and accurate company data has never been more important. Buyer due diligence has become increasingly thorough and wide ranging over the 20 years that I’ve been advising sellers. Contributing factors …
Better to sell early in consolidation. Here’s why.
February 4, 2023 / in Exit Planning, Sell a Business / by Al Statz
Consolidation is inevitable in maturing industries. As an M&A advisor working with owners of private wholesale distribution, manufacturing and industrial service companies, one of the questions I am often asked is whether it is better from a valuation perspective to sell early in a consolidation phase, or hold off. It depends of course, but generally earlier is better, all else being equal. I’ll explain why, but first I want to point out that industry consolidation …
Business Valuation 101 for Testing Laboratories
January 31, 2023 / in Business Valuation, Exit Planning / by Adam Wiskind
Testing laboratories operating in the agriculture, food production, environmental, manufacturing and construction industries provide essential and recurring services to their customers. As such they can be attractive to investors looking for steady growth, recession-resistant acquisition opportunities. If you own a testing laboratory and are thinking about an exit, you’ll likely want to know its value. Business valuation can help lab owners to plan for their future and to understand how to improve their company’s financial …
Avoiding costly M&A delays and deal failure
January 17, 2023 / in Exit Planning, Sell a Business / by Al Statz
No matter how motivated the buyer and seller, selling a business is always a challenge. There’s a lot that can go wrong, and deals can fall through at any time. Delays are one of the biggest problems contributing to deal failure. The longer the process drags on, the more likely it is that a) someone gets fed up and moves on or b) something big will happen, economically or geopolitically, that disrupts the deal. Here …
Deal Killers: Undisclosed Liabilities
January 17, 2023 / in Exit Planning, Sell a Business / by Al Statz
We have a saying: “Go ugly early.” When you’re selling a business, put issues on the table right away. Whether you have ineligible employees on your payroll, you just lost a client, or litigation is pending—be up front. For advice on exit planning or selling a business, contact Al Statz, CEO of Exit Strategies Group, Inc., at alstatz@exitstrategiesgroup.com. Exit Strategies Group is a partner in the Cornerstone International Alliance.
Deal Killers: Loss of Key Employees
December 8, 2022 / in Exit Planning, Sell a Business / by Al Statz
If you have certain employees who are critical to operations and would be hard to replace, take steps to secure them before a sale. Noncompete contracts can be one way to reduce employee defections. Take a look at your employee agreements, too, and ensure you have appropriate non-disclosure and “no raid” covenants. Give careful consideration to “stay bonuses” as well. Provide an incentive for employees to stay for a period of time post-closing. Talk with …
Deal Killers: An Ineligible Workforce
December 8, 2022 / in Exit Planning, Sell a Business / by Al Statz
If you run a business and you know you have ineligible workers on your team, you must disclose that in a transition. In limited cases, you may find a buyer who is willing to accept the problem and address talent issues after an acquisition. Unfortunately, if you’re selling your business to a strategic buyer (e.g. another company), you’ll find that the appetite for an undocumented workforce is generally low. Larger organizations don’t usually want to …
Operation clean sweep: Preparing your business for sale
December 7, 2022 / in Exit Planning, Sell a Business / by Exit Strategies
You’ve decided to sell. Now how can you get the most for your business? Real estate principles apply, so you’ll want to clean house and maximize your curb appeal. But that’s not all that goes into a successful business sale. You need to “clean up your act,” so to speak, and address some operational issues that may not have been a priority for you over the years. Clean up your financials. Many business owners run …
How to sell your business to a competitor
December 6, 2022 / in Exit Planning, Sell a Business / by Al Statz
When you’re ready to retire, or exit your business, you may think selling to a competitor is your only option. But competitors are seldom your best buyer. They’re rarely willing to pay top value because they’re already established in the market. They can’t see that your “secret sauce” is any better than theirs, so they try to strip away a lot of the goodwill other buyers might pay. Plus, selling to a direct competitor can …
Exit Strategies Group, Inc. is a leading provider of business sales and acquisitions, business valuations, and exit planning services for family owned and closely-held companies since 2002.
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