Check out the Top Ten Franchises to Buy...

Check out this great article by BlueMauMau.org outlining the top ten best franchises to buy... it also has a great link to an article with a spreadsheet showing SBA default rates for various franchises... very informative.

2012's Best 10 Franchises to Buy, Least Loan Defaults

By BMM, www.bluemaumau.org
Saturday, 2012/06/16

Knowing a franchise's bottom line and the ability to get a return on investment is the holy grail for a franchise investor. That's no easy feat. What Blue MauMau has been able to do is to find chains that franchisees are healthy enough with their earnings to at least pay back their loans more than other brands. So here are the ten best franchise brands in which franchisees have enough staying-power to pay back their lender.

If you are interested in purchasing a franchise, this is a must read.... click here to read the full article.

Top Four Factors in Closing a Deal

1. The assurance of a prompt closing - Deals that are allowed to drag are more at risk of falling through. Sellers, buyers, and the related professionals should all be motivated to keep the process moving. This does not mean glossing over issues and concerns in order to close the sale, but dealing with each step of the process in a timely manner. A professional business intermediary can be a big help in keeping the momentum of a sale moving forward.
2. How the deal is structured - This includes such things as cash, stock, contingencies, earn-outs, representations and warranties, etc.
3. Full price and/or the considerations
4. Legal and/or governmental issues - Obviously, the presence of such issues can be a hindrance to the successful closing of a deal. A business owner will want to address these issues before placing a business on the market.

Benefits of Meeting with a Business Broker in person...

Whether you are ready to list now or are considering in the next fews years, as you move forward with the sale of your business, you will want to consider all of your options. Speaking to a qualified business broker is one of the first steps you are going to want to take. You will be better prepared to move forward whether you list with the broker or not. Arming yourself with all the tools available to you is always a good idea. But, do not think a quick conversation over the phone is going to give you a full picture of the advantages that a business broker can offer to the situation.

A qualified business broker can render an initial opinion of value, and recommend courses of action to market your business. In order to do so, you will want them to have a full picture of your business. An on-site meeting can give your potential broker a better understanding of your business. You want them to see it as more than just the numbers. Your business has a flavor, and should you decide to list, the better understanding the broker has the more likely they are to concentrate on that right-fit buyer, the one most likely to see the value and succeed in your business...

Click here to read my full  article, and respond with a comment. Would love to hear what you have to say...

Ralana D. Abraham
Business Broker, Dir. of Marketing
Sunbelt Indiana

Are you sure you're ready to sell?

You may have decided it's time to sell, but before you begin the M&A process, you need to take a good, hard look at what you plan to put on the block. Just because you're ready doesn't maean buyers will be interested - particularly if this is the first time you've thought about preparing your business for sale.  Prospective buyers won't just scrutinize your business, but they'll also compare it to other opportunities in the marketplace.

Asking tough questions
With the help of your M&A advisors, go over your company with a fine-tooth comb, just as a buyer will during the due diligence stage. Evaluate everything from debt levels to personnel to customer relationships and address any issues that are likely to give potential buyers pause, such as too much business concentration in only a few customers.

To read the full article by the staff at SunbeltMergers.com click here.

Exit Planning:Prepare for an out while you're still in

Running a successful business is time consuming, leaving you little time to plan what may seem like distant succession issues. It's important, however, to outline an exit plan and make succession decisions as early as possible. Evaluating and grooming possible successors or preparing for an outside sale can take years. And it's never too early to make retirement and estate plans.

Take stock
Before determining where you want to be when you're ready to retire, assess where you and your business are financially today. Prepare a detailed financial analysis of your business with the help of a valuation professional. This expert will review historical data to determine its current value.

Click here to read the full article by the staff at SunbeltMergers.com.

Negotiating the Price Gap Between Buyers and Sellers

The terms of the deal are extremely important to both parties involved in the transaction. Many times the buyers and sellers, and their advisors, are in agreement with all the terms of the transaction, except for the price. Although the variance on price may seem to be a "deal killer", the price gap can often be resolved so that both parties can move forward to complete the transaction.

Listed below are some suggestions on how to bridge the price gap.

• If the real estate was originally included in the purchase price, the seller may choose to rent the premises to the acquirer rather than sell it outright.
• The purchaser can acquire less than 100% of the company initially and have the option to buy the remaining interest in the future.
• A subsidiary can be created for the fastest growing portion of hte business being acquired.
• A royalty can be structured based on revenue, gross margins, EBIT, or EBITDA.
• Certain assets, such as automobiles or non-business-related real estate, can be carved out of the sale to reduce the actual purchase price.

Although the above suggestions will not solve all of the pricing gap problems, they may lead the participants in the necessary direction to resolve them. The ability to structure successful transactions that satisfy both buyer and seller requires an immense amount of time, skill, experience and most of all - imagination.

Creating Value in Privately Held Companies

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. Building value should focus on six components:

• the industry
• the management
• products or services
• customers
• competitors
• comparative benchmarks

Click here to read the full article Courtesy of the Business Brokerage Press.