What do you do after you find a Seller
Welcome to lesson # 5 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.”
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. Take your time, don’t rush, and ask the key questions on the business Sellers checklist. You might have a confidentiality agreement with you to offer to the owner right up front. This lets him know you are a serious buyer. The first thing you need to find out is why he is selling his business. You’ll need to probe to find the real reason. Make it your business to find the motivation for the Seller to sell. Some of the reasons might be:
• Retiring: This reason is used a lot, just make sure the Sellers aren’t thirty years old.
• Health: If the Seller looks and acts healthy, I ask more questions.
• Divorce: Not always the reason for selling.
• Break up of a partnership or partners:
• Death of the principal:
• Spin off:
• Lack of working capitol:
• Unwillingness to deal with change:
• Burnout: this reason is used a lot, be wary, most of the time there are other reasons.
The Seller must be made to feel comfortable when discussing his business with you. You must convey to the Seller that you are sincerely interested in buying his business. Don’t move forward until you can feel that you are building a good rapport with the Seller. It will accomplish nothing if you are an adversary with the Seller. You don’t want your relationship to be built on “I am going to win by hook or crook”. No one wins in this kind of negotiating on buying a business. You’ll learn later when it’s to your advantage to be unreasonable, now is not the time. You need to remember the buyer and the Seller are natural adversaries.
Two Things That Keep A Business From Selling – Over Priced, No Terms
The buyer wants to pay as little as possible and the Seller wants as much money as he can get. Something else to remember, the buyer and Seller rarely get exactly what they want. Both parties will have to compromise along the way to close the deal. You want the compromising to start with the Seller.
We need to remind ourselves that this meeting is to gather as many facts and as much information as possible. Sometimes the Seller will give you a lot of information in your first meeting, depending on his first impression with you.
The first thing to find out, is how long the business has been for sale. Also has it been offered for sale before. This probably should not be your first question. Other questioning will lead you to this question. The answer to this question is important because it will tell you if the business is over priced or lacks reasonable terms. Two things that keep a business from selling are being over priced and the lack of terms. You need to operate on the fact that the Seller is over priced. If the business has been on the market for more than six months, chances are the business is not worth what the Seller is asking. Of course, the business can go on the market for sale today and be over priced and usually is. The average business owner is his own worst enemy because of the lack of proper preparation.
Don’t be shy about asking questions. Make it your right to have them answered before you move on, as long as you ask the questions in a nice business like manner, for example: Why are you selling the business? What will you do after you sell? How much are you asking? How did you arrive at this price? Pay close attention to the answer to this question. In most cases you will catch the Seller off balance. Here are some examples of what they might say:
• That’s how much I have to have.
• My accountant says that’s how much it’s worth.
• A friend told me a business just like mine sold for that much in Ohio.
• In our industry you ten times the bottom line or cash flow. (that’s a good one)
• I added up my equipment and inventory and added so much for good will
Believe me I have heard all kinds of reasons why the Seller’s business was priced unreasonably. When you are questioning the Seller, don’t push, just be straightforward. Don’t react one way or the other. Notice the Seller’s reaction. Your objective here is not to be critical or to offend but to obtain sensitive information. The Seller will more than likely answer these questions, because you asked in straightforward manner. If he does balk, ask him if there is some reason why you shouldn’t know this information. Would it be possible that the answers to your questions would keep you from buying his business? Be nice. Shut up and wait for his answers. The answers you get will probably surprise both you and the seller. After all, the seller probably hasn’t been asked these kinds of questions unless he’s read this book.
Note: I know I threw a lot at you this week, but I wanted to make sure that I had “too much” rather than “not enough”. Be sure to save each lesson and print them out and put them in a three binder so you can easily refer to them.
In the coming lessons, I will share NUMEROUS financial techniques that I have and still use today to buy or start a business. I think you will like them. Stay with me! This is going to be fun!
This Week’s Assignment
1. Always think about making a good first impression with the Seller.
2. Remember, the Seller will have their price, which is usually too much.
3. Read this lesson again. If you’re buying a business. There are a lot of nuggets here.
Reminder: There are lessons coming on starting a business, please be patient.
These are exciting times!: There never has been a better time to buy or start your own business. I bought my first business in the 70’s gas lines were around the corner and interest rates were in the 20% The business that I bought, I turn it around and sold it 11 months later for three times what I paid for it. The economy didn’t matter!
See you next time,
Hold on Tight to Your Dream
P.S. Don’t forget the personalized coaching positions that are available at www.whowantstobetheboss.com/coaching.html
Coming Up Next…
Lesson #6: What is The Real Reason You Want to Sell Your Business?
Whoa! This is a great question and you have to ask it.
In this lesson you will become comfort in asking the right questions. Stay with me….its getting to be fun!