http://biz-value.net/ BizValue - Blog RSS Feed 2.0 en-us Mon, 27 Jul 2026 09:47:51 GMT Mon, 27 Jul 2026 09:47:51 GMT http://biz-value.net/blog/17991/One-Buyer-Controls-the-Deal--Multiple-Buyers-Create-Value- blog When a business owner receives an unsolicited offer to buy their company, the initial reaction is often excitement. After all, someone sees enough value in the business to pursue it. While that interest is certainly encouraging, it is also important to recognize one simple truth: When you have one buyer, the buyer is in control. When you have multiple buyers, you are in control. The difference can mean hundreds of thousands—or even millions—of dollars in purchase price, better deal terms, and greater confidence that your company's legacy will continue. Selling More Than a Business For most owners, a business represents decades of hard work, sacrifice, and perseverance. It is more than a financial asset—it is a significant part of their life's work. Naturally, owners want more than the highest price. They want confidence that the buyer will take care of their employees, continue serving their customers, and preserve the culture they worked so hard to build. Finding that buyer requires much more than accepting the first attractive offer. Finding Interested Buyers Is Only The Beginning Many owners believe the primary role of a business intermediary is simply finding a buyer. That is only a small part of the process. The greater challenge is creating a competitive environment where the right buyers emerge, and the weaker buyers are filtered out. That begins with: Properly valuing the business.  Preparing professional marketing materials.  Identifying and properly qualifying buyers.  Executing confidentiality agreements.  Evaluating each buyer's financial capacity, operational expertise, and cultural fit.  Only then does the real work begin. Not Every Offer Is a Good Offer On a recent engagement, we received seven Letters of Intent (LOI's) from prospective buyers. At first glance, that sounded like an excellent outcome. However: Two offers were significantly below market value.  One buyer lacked the operational experience necessary to run the business successfully.  Another attempted to reduce its purchase price by nearly 30% after initial negotiations.  Ultimately, three highly qualified buyers remained. Even then, the process required navigating due diligence, lender approvals, negotiations, and a complex purchase agreement before reaching a successful closing. Without competition among buyers, the outcome would almost certainly have been very different. Experience Creates Better Outcomes Selling a business is one of the most important financial events in an owner's life. The owner still plays a critical role throughout the process, but an experienced intermediary manages the valuation, marketing, buyer screening, negotiations, due diligence, financing, and countless details that can determine whether a transaction succeeds—or falls apart. The objective isn't simply to find someone willing to buy your business. The objective is to create a competitive process that produces the right buyer, the best value, and the strongest terms. Mon, 27 Jul 2026 06:00:00 GMT http://biz-value.net/blog/17991/One-Buyer-Controls-the-Deal--Multiple-Buyers-Create-Value- http://biz-value.net/blog/17377/Preparing-Yourself-for-Your-Next-Chapter blog Most business owners believe the best time to sell is when they are ready. In reality, the best time to sell is when three things align: Your industry is doing well. Your company is doing well. You are mentally prepared for your next chapter. The first two are relatively easy to evaluate. The third is often the most difficult. For many owners, their business is more than an asset. It is a source of identity, purpose, relationships, and accomplishment. Selling a business is not simply a financial transaction—it is a life transition. One of the biggest misconceptions I encounter is that owners must have everything figured out before they begin the sale process. They believe they need a detailed plan for retirement, travel, a new venture, or whatever comes next before they can even consider selling. That is rarely how it works. Preparing for an exit is a process, not a one-time decision. In fact, many owners become more comfortable with the idea of selling as they move through the process. As they meet potential buyers, evaluate their options, and begin envisioning life after ownership, the next chapter often becomes clearer. You do not need to have every answer before you start. What you do need is information. A good first step is obtaining a professional valuation of your business. A valuation does much more than provide a number. It helps answer important questions: Will the proceeds support the lifestyle I want? Am I financially prepared for an exit? What factors are driving value? What changes could increase value before a sale? Most importantly, a valuation replaces uncertainty with knowledge. Whether you plan to sell in one year or ten years, understanding the value of your business today helps you begin preparing both financially and emotionally for the future. The owners who achieve the most successful exits are usually not the ones who wait until they are completely ready. They are the ones who start preparing early, gather information, and allow themselves time to adjust to the idea of moving on. The next chapter of your life doesn't need to be fully written before you begin exploring an exit. But understanding what you've built—and what it's worth—is often the first step toward writing it. Tue, 16 Jun 2026 06:00:00 GMT http://biz-value.net/blog/17377/Preparing-Yourself-for-Your-Next-Chapter http://biz-value.net/blog/17075/Why-Do-So-Many-Businesses-Fail-to-Sell- blog You've likely heard that "80% of businesses don't sell."  That statistic is misleading without context. The truth is that success rates vary significantly based on size, quality, and preparation. The Reality Business Size | Typical Close Rate $1M–$10M | ~30–40% $10M+ | ~40–50%+ What this means: Smaller and underprepared businesses skew the data. Well-positioned companies have much higher success rates, even if they are relatively small. Why Businesses Don't Sell Most failed transactions come down to a few key issues: Unrealistic expectations – Pricing isn't aligned with market-based cash flow and risk. Unclear financials – Buyers and lenders need confidence in the numbers. Owner dependence – If the business relies on you, it's harder to transfer. Inconsistent earnings – Volatility creates perceived risk. Financing breakdowns – Deals often fail during lender or SBA review. The Real Problem: Lack of Preparation Businesses rarely fail because they are unsellable—they fail because they are unprepared. Preparation drives: Value – Priced right Buyer confidence – Financials that clearly reflect true earnings Deal certainty – It's about getting across the finish line without the deal falling apart or being renegotiated. How to Improve Your Outcome A successful exit typically starts well before going to market: Establish a realistic valuation range Present clean, well-documented financials Reduce reliance on the owner Identify and address risks early Prepare for lender scrutiny The Difference Professional Guidance Makes Working with an experienced advisor can significantly improve outcomes by: Setting realistic expectations – pricing, timing, and process Positioning the business effectively Running a disciplined, competitive process Helping avoid common pitfalls that derail transactions Final Thought Business owners who achieve successful exits typically do so because they prepare early, understand value drivers, and approach the process with clarity and discipline. A thoughtful, well-executed process can make a meaningful difference—not only in whether a business sells, but in the terms, structure, and overall outcome of the transaction. Tue, 05 May 2026 06:00:00 GMT http://biz-value.net/blog/17075/Why-Do-So-Many-Businesses-Fail-to-Sell- http://biz-value.net/blog/16053/Basics-of-SBA-Financing-for-a-Business-Acquisition blog What is an SBA loan? Most business acquisitions are funded through Small Business Administration (SBA) loans. The SBA doesn't actually loan the money—loans go through banks and are guaranteed by the SBA, which establishes guidelines to simplify the qualification process and reduce lender risk. Choosing the Right Banker While your existing bank relationship matters, the individual banker is more critical. Business acquisitions have unique complexities that require an experienced professional. Use a bank certified in the SBA's Preferred Lender Program (PLP) for streamlined approvals. Research and get referrals for bankers with a proven track record of closing deals—they'll have deep SBA knowledge and strong internal relationships to avoid the 30-90 day delays common with less experienced bankers. SBA Loan Types SBA 7(a) Loan: Versatile financing for working capital, equipment, real estate, or business acquisitions. SBA 504 Loan: Specifically for major fixed assets like real estate or equipment. Key Requirements for Both Credit Score: Mid-to-high 600s or higher (lender-specific) Equity Injection: 10-20% of total project cost Business Plan: Detailed use of funds and repayment strategy Financial History: Personal and business financial statements Management Experience: Demonstrated ability to run the business Note: The SBA doesn't set minimum credit scores, but lenders do—check with your lender for their requirements. Loan Comparision   SBA 7(a) SBA 504 Uses Business acquisition, equipment, working capital, real estate Real estate/land acquisition, construction, equipment Amount Up to $5 million 50% lender + 40% CDC (max $5M) + 10% borrower Terms Up to 10 years (working capital/equipment) Up to 25 years (real estate) Up to 10 years (equipment) Up to 25 years (real estate) Eligibility Operating U.S. business, for-profit, meets SBA size standards, creditworthy    For-profit U.S. business, net worth Operating U.S. business, for-profit, meets SBA size standards, creditworthy    For-profit U.S. business, net worth How to Apply Assess Your Needs: Review your financials, credit status, and determine how much you need and how you'll repay it. Choose the Right Loan Type: Match your funding purpose (acquisition, equipment, real estate, working capital) to the appropriate SBA loan. Select a Lender: Find a Preferred Lender Program (PLP) bank with experienced bankers who have a track record of closing deals. Gather Documentation: Work with your banker to compile required financial statements, business plans, and supporting documents. Submit Application: Your business relationship manager will guide you through the final submission process. The key to success is preparation and choosing an experienced banker who can navigate the process efficiently. Mon, 08 Dec 2025 06:00:00 GMT http://biz-value.net/blog/16053/Basics-of-SBA-Financing-for-a-Business-Acquisition http://biz-value.net/userfiles/2182/blogs/hero%5Fblog15901%5F20251023%5F165526%2Ejpg http://biz-value.net/ http://biz-value.net/blog/15901/Hair-Tips-for-the-Holidays blog Hair Tips for the Holidays The holidays are packed with events, family gatherings, and a flurry of parties. It's fun, but let's be honest—between the cold, endless styling, and packed calendars, your hair can take a beating. Whether you're headed to a quiet dinner or a big New Year's bash, it helps to keep your hair looking and feeling good. Here are some no-nonsense tips that'll help you keep your hair in shape through the season. 1. Prioritize Moisture Dry air from the weather and indoor heat can make hair feel rough and tired. Swap in a hydrating shampoo and conditioner, and try a weekly deep conditioning mask. This helps ward off breakage, frizz, and those pesky split ends. Healthy moisture keeps your hair stronger and less likely to lose its shine. 2. Limit Heat Styling Tempted to reach for the curling iron at every invite? Happens to everyone. But too much heat isn't your friend. Save hot tools for big moments, and use a heat protectant when you do. Looking for options? There are plenty of festive no-heat styles that look just as good, if not better. 3. Accessorize for Effortless Glam Don't want to fuss with your hair all night? Toss in a sparkly pin, a headband, or a clip, and you're done. Hair accessories can instantly dress up your look with zero effort—just be sure to choose those that won't snag or pull. 4. Schedule a Trim Year's end is a smart time for a trim. Fresh cuts clear out split ends and get your hair back on track. Thinking about switching things up? Your stylist can offer some ideas for a festive update. 5. Protect Your Hair from the Elements Wind, snow, and even drizzle can rough up hair fast. A hat or scarf gives your strands a break outdoors. Worried about flat hair after? Go for loose styles under your hat and try a light leave-in conditioner to keep things smooth. 6. Prep for Party-Ready Hair Cleanse Wisely: Skip daily washes. Your hair's natural oils do more good than you think. Dry shampoo can freshen things up when needed. Use Quality Products: Salon-grade products can make a difference. Check out Pro Salon Concepts for professional picks that keep your hair looking sharp. Set Your Style: A flexible hold hairspray will keep your look in place without making it stiff or crunchy. 7. Nourish from the Inside Out What you eat shows in your hair. Drink water, and work in foods like leafy greens, nuts, and fish. These simple choices help your hair stay strong and shiny. Conclusion With these straightforward tips, your hair can hold up through all the holiday bustle. Just a bit of extra care goes far. Want more advice or products? Take a look at prosalonconcepts.com. Fri, 24 Oct 2025 03:00:00 GMT http://biz-value.net/blog/15901/Hair-Tips-for-the-Holidays http://biz-value.net/blog/15811/What-is-SDE-and-why-is-it-important- blog Seller's Discretionary Earnings (SDE) is a measure of cash flow for a business.  It is used as a basis for valuations and to identify business opportunities within ranges for buyers. Components of SDE We start with the net income before taxes. Add-backs Interest expense Depreciation expense One owner's salary Some owners' expenses run through the company.  Some examples may be life insurance paid by the company for the owner, auto expenses (if this is not necessary in the operations of the business), other identifiable expenses that would not be required by the buyer.  This becomes a murky area.  The main criteria is if the buyer's bank would allow the adjustments, or not. e.    Unusual, one-time expenses. An example might be the deductible paid by the business for flood damage. Negative add-backs (deductions) Rent adjustments.  This often applies when the seller owns the property.  A positive or negative adjustment is applied for the variance in the amount paid and the fair market rent. Salary adjustment.  If there are two owners, you are only allowed to add-back one salary.  Say the second owner draws a salary of $20,000 and does the books.  We further assume it would cost $50,000 a year to replace them.  So, we would do a deduction of $30,000 for a replacement for Owner #2.   Other adjustments may apply such as a deduction for the gain on sale of an asset.  This would typically not be a part of the normal operations of the business, so it would be deducted.   The net income before taxes, plus or minus the adjustments, equals the Seller's Discretionary Earnings (SDE). Buyer's Perspective SDE is the amount that is available to:     Cover debt payments     Pay yourself a salary     Provide a reasonable financial return for taking on the risk of owning the business Seller's Perspective SDE is the amount of cash flow that is applied to a multiple to calculate the value of the company.  It is in the seller's interest to have the most SDE possible.  However, the add-backs need to be limited to only those that would be allowed by a bank. Banker's Perspective Ultimately, the acquisition will be funded by a bank.  SDE is calculated separately by the bank's underwriting department.  It is used in their calculations to see if there is sufficient cash-flow by which to service the debt.  This calculation is called the Debt Service Coverage Ration (DSCR).  And it is used in their independent valuation process. Accurate SDE calculations are critical for successful business sales.  SDE's that are inflated with invalid add-backs, lead to unrealistic valuation expectations for sellers, resulting in extended negotiations, or deal failures.  Accurate ones lead to quicker sales and better outcomes for both the sellers and the buyers.   Mon, 13 Oct 2025 06:00:00 GMT http://biz-value.net/blog/15811/What-is-SDE-and-why-is-it-important-