• How to Do Due Diligence on a Small Business

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    When buying a small business, it's essential that you know what it is that you're buying. Many small businesses are sold based on seller stated revenue and earnings figures and without delving into the financials to make sure the numbers are substantiated, a buyer can end up overpaying for a business that generates revenue much less than what was stated.

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  • How to Get the Higher Multiple when You Sell Your Business

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    If a business in a specific industry is going to sell for 3 to 4 times earnings, what determines whether the buyer will be willing to pay the lower or higher multiple? In other words, if adjusted earnings are $800,000 and the industry multiple is 3 to 4 times earnings, what determines whether the buyer will be willing to pay $2,400,000 versus $3,200,000 for the business?

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  • Your Competitor Wants to Buy You Out—What’s Your Next Step?

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    It is not uncommon to be approached by a competitor that wants to buy you out to gain market share. If you have been thinking about selling your business, you may be tempted to start negotiating without really being prepared. Doing this will put you at a distinct disadvantage because you don’t necessarily know the value of your business, your business hasn’t been packaged property to show its value and there is no urgency factor to your competitor to move quickly or give you a good price because there are no other potential buyers in the picture. So what would be your best next steps?

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  • What is a Financial Recast and Why is it Important?

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    When valuing a business, it is important to identify and understand the economic value of the business. The economic value of a small business will typically be substantially different from the book value and from the tax mitigated value.

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  • Ask the Right Question to Get What You Want!

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    In business and in life asking the right question can make a world of difference. Have you ever had a friend, spouse, child, or employee come to you and tell you all the reasons why they can’t do something they want to do, can’t have something they want to have, or can’t achieve a goal they set out to achieve? An interesting little exercise is to have them write their primary complaint at the top of a page, followed by the question “How Can I…?”

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