New this survey, advisors reported that 65 percent of their new sellers and 41 percent of their buyers were baby boomers in first quarter 2014. “The older boomers are selling and the younger boomers are buying,” said Scott Bushkie, president of Cornerstone Business Services. “The boomers are affecting both sides of the transaction, helping create more activity on top of the strong interest from corporations and private equity to grow through acquisition. It’s easy to see why activity is at an all-time high for the last five years. “That said, the Main Street market remains a buyer’s market,” Bushkie continued. “It’s unlikely values will increase as long as there’s a larger number of baby boomers selling than there are buyers looking for Main Street opportunities. We’d need to see other market scenarios take precedence for valuations to change.” For Main Street, retirement was the number one reason driving sellers to market, followed by burnout. Notably, in the lower middle market, the … [Read more...]
Corrugated Box Manufacturer
Business Description:The Company (a Maquiladora) experienced progressive growth until 2012 when its operations were impeded by its controlling entity’s paper mill (see applicable separate profile) operations’ funding/cash flow challenges. The Company was providing working capital resources to support the paper mill to a finished state to supply paper not only to the Company but to other third party entities. In 2013 the Company re-built its solid customer base and continues to be successfully working through the impediment issues (notwithstanding the continuing increased demand for its products). The Company’s growth issues were incurred by strict creditor terms of its materials’ suppliers via its 2012 cash-flow support to the paper mill needs. Distribution:The Company has a strong recurring based of customers and distributes its products primarily to the Western U.S. including an expanding demand for corrugated box products. The Company has a reputation for quality … [Read more...]
Senior Care Business Opportunity
Asking Price: $39,500 Established: 2006 Location: Indianapolis area Business Description In Home Senior Service is one of the fastest growing industries in the nation. This franchise provides non-medical in home care. As a franchisee, you are provided with a comprehensive proprietary custom software package that is the best in the industry that allows you to run your business from any place in the country with an internet connection. The terriitory is protected. Excellent training and support and other benefits from a first class franchise organization. The potential for growth is unlimited. Detailed Information Competition:A competitive industry within a fast growing industry.Growth & Expansion:Enormous grwoth potential.Support & Training:Will train as needed. Also, excellent franchise support … [Read more...]
Creating Value in Privately Held Companies
“As shocking as it may sound, I believe that most owners of middle market private companies do not really know the value of their company and what it takes to create greater value in their company … Oh sure, the owner tracks sales and earnings on a regular basis, but there is much more to creating company value than just sales and earnings” Russ Robb, Editor, M&A Today Creating value in the privately held company makes sense whether the owner is considering selling the business, plans on continuing to operate the business, or hopes to have the company remain in the family. (It is interesting to note that, of the businesses held within the family, only about 30 percent survive the second generation, 11 percent survive the third generation and only 3 percent survive the fourth generation and beyond). Building value in a company should focus on the following six components: the industry the management products or services customers competitors comparative … [Read more...]
Buying or Selling a Business: The External View
There is the oft-told story about Ray Kroc, the founder of McDonalds. Before he approached the McDonald brothers at their California hamburger restaurant, he spent quite a few days sitting in his car watching the business. Only when he was convinced that the business and the concept worked, did he make an offer that the brothers could not refuse. The rest, as they say, is history. The point, however, for both buyer and seller, is that it is important for both to sit across the proverbial street and watch the business. Buyers will get a lot of important information. For example, the buyer will learn about the customer base. How many customers does the business serve? How often? When are customers served? What is the make-up of the customer base? What are the busy days and times? The owner, as well, can sometimes gain new insights on his or her business by taking a look at the business from the perspective of a potential seller, by taking an “across the street look.” Both owners and … [Read more...]
What Would Your Business Sell For?
There is the old anecdote about the immigrant who opened his own business in the United States. Like many small business owners, he had his own bookkeeping system. He kept his accounts payable in a cigar box on the left side of his cash register, his daily receipts – cash and credit card receipts – in the cash register, and his invoices and paid bills in a cigar box on the right side of his cash register. … [Read more...]
Burnout: An Ever-Present Threat
Burnout is an often-used reason for an owner selling his or her business. Potential buyers may have trouble accepting this as a valid reason for sale. However, burnout is a valid reason for selling one’s business. … [Read more...]
How Long Does It Take to Sell a Business?
Recent studies indicate that it now takes, on average, about eight to ten months to sell a small business. This figure seems to increase yearly. Why does it take so long to sell a business? … [Read more...]