Who Are The Sellers?
Welcome to lesson # 4 Who Wants To Be The Boss? I’m excited to have you as a valued member of our 6-month training program and am looking forward to seeing your own “business” “come to life” over the next few weeks and months.
Before we begin with this lesson, there are three important things that I need to mention to you…
1) Time Released Bonuses Every Throughout of The Program. You’ll automatically receive a FREE bonus as an active Who Wants To Be The Boss? subscriber. This will appear in your inbox approximately every 90 days or sooner and will include accessories and training materials to further streamline your time for you. Additionally, there are some built-in “surprises” (coaching, etc.) along the way at unspecified intervals. And, finally, there is a “graduation” bonus at the completion of your 6 month training that is literally worth more than the entire year’s subscription dues … so look for that on graduation day.
2) What’s In Store The First Few Months. I want to give you just a quick look at what we’ll be covering during the first few lessons in your training…
The first month will be the basic steps involved in getting things up and running (don’t fret veterans, I’ve got some “gold nuggets” in these preliminary lessons for you!) and the next month will be advanced strategies for expanding and improving the foundation of your new business.
3) Why You Should Never Cancel. There are many reasons why you should stick with your membership (it’s great training, if you keep quitting one thing and going to another you’ll never get anywhere, even if you don’t use it all now you can archive it to use later, etc.) (I also suggest you get a 3 ring binder and print and save each lesson) but there is an all-important reason that I have to warn you about from the beginning. Each of your lessons is sequential and delivered by autoresponder. That means, if you decide to cancel and rejoin at some point in the future, you’ll have to start all over again with the very
Note: Remember, I teach you “How to start or buy a business with no money down” “Lock up your check book, you won’t need it.”
Who are the Sellers?
Where do we look when we go looking to buy a business? Where do we find the business we want to own?
Businesses that are for sale are usually marketed in a confidential manner. Most of the time the best businesses are not advertised at all. They are sold through accountants and attorneys, or to friends and family. Your challenge is to dig out these nuggets before someone else does. You can also find good profitable businesses advertised and listed with brokers. You just have to dig through more junk to find the nuggets. The following is a list that I have and still use to find the business Seller I want to talk to. This list is in no certain order. Talk with everyone you know and let it be known that you want to buy a business.
• Newspaper Business For Sale classified
• Trade Magazines
• The Internet
• Insurance Agents
• Business Brokers
• Networking Groups
• Direct Mail
Let’s start with accountants, attorneys and bankers. These professionals have the inside track. They will usually be the first people to whom the Sellers will discuss the idea of selling their business. The accountant is first because he will have to begin preparing the financial information so the Seller can create or engage in an outside evaluation of his business. A good way to make contact with these professionals is by mail. Send letters out to about 100 accountants and attorneys. Be sure the attorneys work in the business world. In the letter, state that you are personally interested in acquiring a business. Wait a couple of days, then call each one on the telephone to discuss your letter. Bankers have a pretty good pulse on the business community and a lead from them, especially if you can use their name, will carry a lot of weight. It is important to build good relationships with accountants, attorneys and bankers.
Newspaper classified section
Most local newspapers will have more businesses for sale ads in the Sunday edition. The traditional businesses will be advertised under businesses for sale and all the rest under business opportunities. I spend my time in the businesses for sale section. You need to understand that owners of businesses will sometimes advertise their business, for sale by owner, before they list it with a business broker. I like to keep an eye on the businesses I might be interested in and track how long they have been advertising. I also get an appointment with the for sale by owners as soon as possible. Urgency is important.
Sometimes it’s called timing. Read the business-classified section during the week. Most owners are not sophisticated enough to understand the best time to run their ad is in the Sunday newspaper. It’s important to check back issues. You might find that the owner advertised his business at a different price, probably a higher price. This is important because you have found a seller who is in a weakening position. This, of course, puts you in a better negotiating position. Also, another way to use the newspaper is to write your own ad saying you want to purchase a business and place it in the business for sale section of the newspaper. Don’t advertise your no money strategy down or your financial ability to pay for the business.
I always scan the broker ads. In fact, you can learn a lot about buying a business by working with brokers. Most Sellers are emotional when it comes to selling their business, especially if they did a start up and made it grow for 20 years. A good broker can act as a third party and help keep the Seller calm. A lot of emotions happen along the way and at the closing table. After all, the Seller will pay the broker fees. When scanning the broker ads, keep in mind that they only advertise a small percentage of their actual listings. Usually they will advertise the best ones or the newest one. Generally, when you call a broker on a particular business, he won’t give you much information on the telephone. They will want confidential and financial information on you before they release any information about listings and most will want you to come to their office and that’s okay. When they ask about your financial condition, tell them, “Don’t worry, I can handle the deal”. The broker will ask you general questions about what type of businesses interest you. Keep your options open, unless of course you have zeroed in on the type of business you want to buy. Get information about all his listings and how long have they been for sale. Ask the broker which listing has the most motivated Seller. At this stage, sign a confidential agreement, but try not to give out financials.
Remember, you are trying to buy with no money down, but you never let the broker know that you are going to buy a business with none of your money down. He will be very concerned about where his commission will come from. When you start dealing with the Seller or a business broker, always demonstrate the confidence that you have the money to put the deal together.
Always treat everyone in a business like manner, be nice and be unreasonable when necessary. Dress the part, look and act business like, don’t get emotionally involved in the deal until it’s a done deal. Mentally, always be in the position to walk. Be persistent, be patient.
Suppliers are rarely the first to know if and when a business might be for sale, unless the owner is in trouble and he lets his supplier know he wants to sell. That can be okay, if you’re looking for a turn around situation. Talk to delivery people. Talk with people in the supplier’s office, the bookkeeper or the comptroller; they hear rumors all the time.
The Internet is a great source of business listings for sale in your area, both by owner and by brokers. I strongly encourage you to start surfing the net. If you don’t, you’re missing out on a great tool. For example, go to http://www.bizbuysell.com and select a location by state and broker. You’ll have hundreds of businesses to look at, plus lots of information on buying a business. You can also find for sale by owner sites. It’s a good way to get information quickly without all the hassles.
You should put out the word in your networking groups; chamber, rotary, social, religious, and business clubs. Convey your interest in buying a business. Word of mouth works. It can be the best way to find out about a good business that’s for sale before it goes on the market. You must remember that Sellers are and should be concerned about confidentiality. Dropping a word here and there is different then standing up before a group and announcing that you want to buy a business. Be discreet. Respect the confidentiality. Don’t be a loose cannon.
I believe the fastest way to find potential Sellers is by sending them a letter.
Be sure the letter is addressed to the owner with the word confidential printed on the envelope. This letter should be type written, one page and right to the point. This letter can reach Sellers in a very early stage. Sometimes they have been trying to sell their business unsuccessfully. It’s a great way to get to the owner before competing buyers or brokers learn the business is for sale. Follow up all letters with a personal telephone call to the owner.
One more thing: Your direct mail piece can be hand written or typed. I prefer typed. The words you use in this letter are very important. Your goal is to get the Seller to respond to you. I will be sending you a sample letter that I have used. Watch your inbox.
This Week’s Assignment…
1. Start talking with everyone you know and let it be known that you want to buy a business.
2. Start networking with a banker, networking groups. I bought my first business through a networking group that I belonged to.
3. The main thing is to start the process. The more of the process you are into, the more enthusiasm you will have.
That’s it for today. See you next week with lesson#5
Hold on Tight to Your Dream.
P.S. Don’t forget the personalized coaching positions that are available at www.whowantstobetheboss.com/coaching.html (If nothing else, you may want to take advantage of this for the first month of you learning.)
Coming Up Next…
Lesson #5: What do you do after you find a Seller?
Your first contact with the owner is very important. First impressions here will go a long way in putting the deal together. How you handle yourself and the business owner during the first meeting will be a key element in your future relationship together.