S7 W6 E21-24 What to Expect at a Business Closing with Bill Kelly

The Entrepreneur’s Edge with Bill Kelly

Expert Advice on Buying and Selling a Business on the IBGR. Network ...The World of Business at Your FingertipsWeek 6, Episodes 21-24,  What to Expect at a Business Closing.  

Welcome to week 7 of the Entrepreneur’s Edge with Bill Kelly
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Quote of the Week: “Today I close the door to the past … open the door to the future, take a deep breath, and step through, to start the next chapter in my life.”  –  Unknown 

Week in Review: What an incredible week! My team is in the process of listing Six successful businesses for sale, representing over Twenty Million Dollars in value! Many thanks to my past customers, network partners, and my amazing telemarketing team for these referrals. One of the passions of my life is helping successful entrepreneurs sell their businesses and move on into the next chapter of their life. Another is helping young entrepreneurs find and acquire valuable businesses that will help them meet their life goals for their career and their family. 
 
We have two businesses under Due Diligence and hopefully they will close this year or early next year. 2021 has been an amazing year, and as we draw close to it’s end. Think about what the next chapter in your life will be. There has never been a better time to sell or buy a business.  

If you, or someone you know, is interested in selling a business or buying a business, please contact me at Transworld Business Advisors of Richmond. Transworld is the largest seller of small businesses in the US with over 300 offices in 21 countries, and we have the experience and resources to professionally manage your transaction.

Contact me, Bill Kelly, Transworld Business Advisors of Richmond, VA ● 804-510-0670 ● bkelly@tworld.com

Episode 21 Explaining the different types of business closings.
Closing can be very difficult without the proper preparation.

1. Two Different Types of Business Sales Models. When selling a small business there are only two types of sale you can choose from. Asset Sale or Share Sale. Whether your Buyer is an internal (family, employee person or group), a management group, or an outside third party, these are the only two types of sales models you can choose from.
    
2. Asset Sales include only the assets owned by the business at the time of sale. The term “assets” include both tangible and intangible items. Tangible means items such as land, buildings, equipment, cash, investments, and inventory. Intangible means items such as goodwill your business has built up during its years of operation, websites/social media sites, customer lists, patents, copyrights, and trademarks.
   
   
   
3. Sole Proprietor Asset Sale. If your business is a sole proprietorship or partnership meaning it’s not incorporated,  an asset sale is your only option, and it can be a level more difficult. A sole proprietorship by definition is typically a one-person business with the owner's skills and experience often representing most or all of the businesses value.
   
   
   
4. Share Sale also known as a stock sale, can simplify valuing and closing a business sale because you are selling the shares of the business not just its assets. Obviously, you must be incorporated to sell this way.
   
   
   
5. Regarding Taxes, in a share sale there may be some advantages to the Buyer and the Seller. Talk to your Accountant or Financial Advisor for the best way to proceed based on your particular circumstance.
   
   
   
6. Liabilities In a share sale, the liabilities are sold along with the rest of the business. So be sure to talk to your lawyer to make sure there are the proper protections for you from past or future liabilities in the final sale documents.
    

Tags: Selling a Business, Business Brokers, Controlling the Deal, Document Management, Buyer Profile, Transworld Business Advisors  ​

EPISODE 22 What to Expect at Closing When Selling Your Business
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Apportionment of the business resources, signing agreements, and payment.   

1. Who Conducts a Business Closing? Closing can be conducted by the Sellers Attorney, the Buyers Attorney, an Intermediary Attorney, or an Authorized Escrow Agent such as a Title Company. Though a great deal of documentation and planning has been completed prior to closing, it is not uncommon for issues to come up at the last moment
   
   
   
2. The Components of Closing The "closing" is the point in the business sale transaction where all necessary documents are signed, money is exchanged for the mutually agreed upon value of the business, and the buyer becomes the new owner of the business.
   
   
   
3. Apportionment of Cash on Hand, Receivables, Payables, and Work in Process. These items are often the point of conflict between Buyer and Seller at closing because their benefits are usually at odds against each other.
   
   
   
4. Loan Funding, Real Estate Transfers, and Landlord Approvals. These three items are usually the cause of delays and often termination of closings. It is important to work with your broker to identify issues in these areas before closing.
   
   
   

Tags: Closing on your business, business closing, Selling a Business, Business Brokers,  Buying a Business, Transworld Business Advisors  

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Episode 23 Preparing Employees for the Sale 
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As previous business owners often say… “timing is everything”.

1. Keep the Sale Confidential Telling employees that you’re selling is an extremely delicate process. Break the news too early and you run many risks of losing your most valuable customers, vendors, and employees prior to the sale.
   
   
   
2. Maintaining Confidentiality is Always Best. Hiding the sale from everyone possible is almost always the best option because it keeps the flow of information under your control
   
   
   
3. Sharing the details with some employees may not be avoidable. Depending on your organization, it may be necessary to inform some of your key employees such as your accountant or a senior-level manager who is very close to daily operations of the business that you plan to sell. It’s also a good idea to introduce them to your Broker.
   
   
   
4. What to do if word of the sale gets out: A breach of confidentiality has killed many deals. If an Employee, Customer, or Vendor comes to you with questions about an impending sale, ask them how they heard this information.  Then assure them you are merely assessing your options and address the information leak immediately.
   
   
   
5. Telling employees after the closing is usually best, but not always. Talk to the Buyer and discuss the timing with them. Always call a private meeting with them and prepare them, prior to introducing them to the new owner.
   
   
   

Tags: Closing on your business, business closing, Selling a Business, Business Brokers,  Buying a Business, Transworld Business Advisors

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Episode 24 Preparing Key Vendors and Customers for the Sale 

Preserving the business momentum and growth are the key considerations.

1. Consider Addressing the Sale in Advance with Key Customers and Vendors. During your ownership of the business maintaining good your communications with your clients and vendors was undoubtedly one of the reasons for your success. Now that you're selling the business, good communication with your clients and vendors will affect their decisions towards the new owner.
   
   
   
2. Just Prior to or Quickly After the Sale It's important to inform your key clients. Otherwise, they could learn about the transition from media outlets, competitors or other sources and there's no guarantee that the information your clients receive from these sources will be accurate.
   
   
   
3. Be Clear and to the Point Professional and clear communication is the key to successfully guiding your customers through the business-ownership transition process. Carefully inform clients, starting with the most valuable, about the sale and building their confidence in the new owner and the transition process.
   
   
   
4. Be specific and prepare your remarks in advance. Consider planning your communications in concert with the new owners’ announcements. Make sure the information your share with Clients is consistent with what the new owner is saying.
   
   
   
5. Stay Positive and Reassuring: Communicate the business sale to customers it's important for you to remain enthusiastic, positive and confident in the new owner's abilities. Introduce the owner in a short statement that conveys your confidence in his/her expertise and plans for the company. If necessary or helpful, explain why you're choosing to sell your business, what your plans will be after the transition. 
   
   
   
6. Most Important To build vendors and customers' continued confidence in the business and instill their confidence in the new owner. Be aware that you're initial communications with Customers and Vendors regarding the sale will affect their  decision to stay with the company or not. 
   

Tags: Closing on your business, business closing, Selling a Business, Business Brokers,  Buying a Business, Transworld Business Advisors  


Short Bio: Bill Kelly is a Senior Business Broker and Franchise Consultant for Transworld Business Advisors of Richmond, VA. He is also a Licensed Virginia Commercial Real Estate Agent. Bill has been a lifelong Entrepreneur and has personally started or purchased and then sold eleven businesses. He lives in Richmond, Virginia, with his wife Rebecca, and has two daughters, and one granddaughter. 
   
Contact links: bkelly@tworld.com

Social Media:     Facebook: https://www.facebook.com/BillKelly1955
        LinkedIn: https://www.linkedin.com/in/billkellyprofile/
Website:     https://www.tworld.com/agent/billkelly/

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