Greg Kells is the Founder and President of Sunbelt Canada, the number one business brokerage in the country. He has directly facilitated the sale of over 1,000 businesses and is a two-time winner of Businessperson of the Year in Ottawa. Greg is passionate about mentoring and teaching, with experience as a guest lecturer at Harvard, Yale, Duke, and various colleges across Canada. He is active in numerous community organizations and advocates for economic empowerment, the environment, science, and technology.
Proper pricing is a must when you go to sell your business. And that means an asking price that is reasonable and correct. A reasonable asking price should factor the true earnings of the business and what the market is willing to pay. Business patterns, systems, competition, markets, quality of service or product, staff and operational factors are all predictors of future earnings that need to be taken into account.
Sunbelt and the Montreal Business Community have lost a great friend - Ron Greeley has left us too soon, taken by cancer on February 12, 2016. Ron, who worked in the Montreal West Island office of Sunbelt Business Brokers, was much loved by his peers and respected and appreciated by his clients. He leaves big shoes to fill and will be much missed by all of us at Sunbelt.
In a recent 2015 post, I noted that more mid-sized businesses in the Canadian market are turning to complementary acquisitions with fold-ins or add-ons that allow the buyer to add on the revenue of the acquisition without the costs the seller (and their smaller business) had. As we enter the New Year with renewed resolve and resolutions, I've been asked to say more about these financial benefits.
Flynn notes that in the U.S., "business for sale listings (mostly Main Street and often with less than $500,000 annual revenues) on the major transaction sites, as well as the middle market business brokerage firm listings are down in almost every North East state we track compared to five ago." Yet "the 2013-15 period was predicted to be the peak of the baby boomer selling boom."
In early December, the Wall Street Journal proclaimed 2015 the biggest year ever in the U.S. for mergers and acquisitions. At home, Canadian companies have been turning their attention to the domestic market with 66% of respondents in an October Ernst and Young Global Limited survey identifying the Canadian market as their primary focus for M&A. Some 57% were focused on cost reduction and operational efficiency - up from 31% one year prior - consistent with what our offices are seeing.
You own a business. You or the business also own the real estate used by the business. You do not have to include this real estate when selling your business. Retaining or selling the real estate separate from the business has its advantages.
You want to sell your business. Fast. And also get the best price for it, of course! Let’s start by what that really means. While six to twelve months is the average time to sell a business, selling time varies by business size, type, and market. Based on that model, six months is quick!
As a human being it is easy to become emotionally invested in your business. After all the things you have sacrificed for it – kids’ soccer games, recitals, family gatherings, etc., it is understandable how this can happen. However, this investment should be treated like any other. If you consult your financial adviser, stock or bond trader, they will advise you that the best time to sell when the price is highest. In the case of selling a business, it is the same thing.
Are you a business owner thinking about retiring or changing your career? Or maybe you’re at the other end of the spectrum, thinking about buying a small or medium-sized business. I was recently interviewed on the subject of buying and selling a business by Norman Jack for CFRA Radio’s Experts on Call program.
The Process of Selling a Business