Dow Disaster - Selling A Business in Trouble Times Business Articles | October 5 Authentic Goran Dragic Jersey , 2008 Selling a business during the Dow crashing and troubled financial times seems a daunting task. The silver lining is the three factors that are discussed in this article which making a business sale even more possible than one would think - at a higher price than one would think.
The crash in the Dow this September rivals the crash that occurred following the terrorist attacks of 911.
The Dow lost 7% of its value in one day! It gained some back after that but the losses that are suffered can be permanent.
Thousands and thousands of business owners, part of the baby boomers, will need to sell their businesses in one manner or another over the next ten to fifteen years. Many of them must sell in the next two to three years.
The financial markets have lost confidence from the people. The government has felt it necessary to publicly pass bailout legislation that the public really does not like.
What does all of this bad news mean for the owner trying to sell a business?
There are three things that are actually good news for those selling a business: 1. People are laid off during these times. 2. Banks do not have the cash liquidity to finance transactions 3. Buyers will be looking harder at the fundamentals of a potential business buy.
How are those good things? Well, let's take a look:
In the late eighties and early nineties, the US economy took a tremendous hit. Compaq Computers and other major companies laid off scores of people. One of the consequences was a boom of new companies being formed and business being acquired as these laid off executives decided to own their own businesses. Severance packages and retirement plans became the source of cash that created new businesses or purchased existing businesses.
The impact of these entrepreneurs entering the marketplace was a dramatic growth of small business. Small business creates more jobs than all of the major companies in the United States. The economic boom that followed was fueled in a major manner by the growth and success of these small businesses, not the major companies.
The effect is buyers in the market place, exactly what the business sellers need to make the transition in their business. Although buyers market will prevail the fundamental cash flow stream of businesses that follow the six systems of of successful businesses will create business sales.
Unsecured debt from banks will dry up for the purchase of business due to a lack of liquidity. Even though bank funding will be absent, the new buyers will tap severance money and retirement money to invest.
Banks, for the most part, are actually not a source for funding to buy a business unless the business has assets, like buildings and land or significant hard inventory, that fits the banks' need for asset based lending. Due to Federal regulation, banks cannot invest in the stock of companies which restricts lending to buy businesses to either unsecured loans or asset based lending. As a result, loans to finance the sale of a business usually do not come from banks.
The combination of the newly unemployed entrepreneurs with severance and retirement funding plus owner financing gives the liquidity needed to sale of many businesses.
Fundamentals of the businesses on the market will be key to buyers. Businesses that are investments with solid cash flow are always good targets. When a business owner has created an investment by having the six necessary systems in place, the business is an investment and not a job for sale. Implementing the six systems of customer attraction, customer engagement, customer service, customer retention, team accountability, and financial reporting will achieve this goal.
The silver lining of the current financial difficulties is a good market for the sale of a small business. To take advantage of that market, a company must implement the necessary systems to have fundamentals that will attract the new entrepreneur buyers that arise from these troubled times.
Article Tags: Small Business
Smart Office Market Research Report: Global Analysis 2019-2024
by ShekhSarha4012 · June 8, 2019
The latest trending report Global Smart Office Market 2019-2024 added by
Smart office products help in promoting efficient use of available resources and also ensure sustainability through use of ecofriendly processes. This report analyzed the smart office by product: smart lighting, security systems, HVAC control and by building type: retrofit, new construction. Usually it contains three important parts that is Underlying hardware systems, Network protocol, Terminal.
The global Smart Office market is valued at xx million USD in 2018 and is expected to reach xx million USD by the end of 2024, growing at a CAGR of xx% between 2019 and 2024.
This report studies the Smart Office market status and outlook of Global and major regions, from angles of players, countries, product types and end industries; this report analyzes the top players in global market, and splits the Smart Office market by product type and applicationsend industries.
Browse the complete report and table of contents @聽
Market Segment by Companies, this report covers
聽Siemens AG 聽Johnson Controls Inc. 聽Cisco Systems, Inc. 聽Honeywell International, Inc. 聽ABB Ltd. 聽Schneider Electric SA 聽ZTE 聽Coor(Smart) 聽Crestron Electronics 聽Conexant
Market Segment by Regions, regional analysis covers聽