BBP Blog

Co-Brokering – Why Not?

DISCLAIMER: Please note that this is one subject that really gets under my skin. As a result, the following may step on some toes, may get under your skin, and hopefully will encourage the one thing that can help you make more money!

On our most recent survey – available now – 52 percent of respondents said that co-brokered deals represented only 15 percent or less of their deals. Actually, 38 percent reported that co-brokered deals represented less than 5 percent of their deals.

When asked why they didn’t co-broke, the most frequent response was “no need” followed by “confidentiality,” “legal concerns,” unsuccessful in the past,” “incompetent brokers,” and “trust/control issues.” Over the years, we have received the same responses in almost the same order.

#1: “No Need”?!?

Read the rest of entry »

Posted on 9/28/2011 4:06 PM By Tom West
In: [General Business Brokerage] | No Comments »

When Prospects Pull the Vanishing Act

What do you do when you can’t reach your prospect …ever? How do you draw the line between optimistic persistence and wishful thinking?

Let’s look at a scenario that someone recently described to me. A few months before, he received a call from a prospect who was very enthusiastic about his product, asked a lot of questions, requested more information and set up a date for a follow-up phone call. My friend sent the information and called at the requested time. No answer, so he left a message and made a note to call again in a week if he had no response; still no answer. He was confused. His prospect had called him! Why was he suddenly getting no response? He continued calling every week or so for several weeks before asking me for advice.

In business, especially in sales, the thing we dislike most is silence – we want feedback, even a “No” is better than no answer because no means we can move on to the next prospect. Silence keeps us hanging on, hoping to hear something. So let’s look at the best ways to get a response – even if it is a no, from our prospects.

Read the rest of entry »

Posted on 9/27/2011 4:26 PM By Amanda Puppo
In: [Marketing] | No Comments »

Maximize Value When Selling Your Business - Get Rid of Excess Inventory

When selling a business, maximizing value is of primary importance to the business owner. One element that can drag down business value is poor inventory management in the form of excess inventory. Maintaining proper inventory levels is essential to maximizing value.

When running a business, the goal should be to tie up as little cash as possible in inventory, while having enough inventory to meet ordinary business needs. After all, a prospective buyer looking at your business as a possible acquisition would rather have fully flexible cash not less flexible inventory weighing profits down. Any additional dollar that can be found to help bottom line earnings when selling a business will be rewarded by a higher price when the business is sold.

Read the rest of entry »

Posted on 9/22/2011 8:16 AM By Rose Stabler
In: [Pricing & Valuation], [Working With Sellers] | No Comments »

Massachusetts Coverall Court Ruling: A Warning to Franchisors

The Massachusetts Supreme Court announced its decision in the case of Awuah v. Coverall North America, Inc. As a result of this ruling misclassifying workers as franchisees in Massachusetts could be very costly to franchisors. This important alert from Nixon Peabody provides a detailed summary of this important decision. Franchisors that currently operate in Massachusetts who bill customers and collect revenues on behalf of their franchisees and advance or submit payments to their franchisees, should be in touch with franchise counsel. Read the complete article and obtain the opinion.

Ed Teixeira is the founder and President of FranchiseKnowHow, LLC, a franchise-consulting firm. Ed has worked in the franchise industry for thirty years. He has served as a corporate executive for firms in the retail, manufacturing, healthcare and technology industries.

Posted on 9/21/2011 11:57 AM By Ed Teixeira
In: [Legal & Tax Issues], [Uncategorized], [Franchises] | No Comments »

Hot Business List - August 2011

Below you will find the current “hot” business list courtesy of data from Businesses For Sale (www.businessesforsale.com). We asked Businesses For Sale for a monthly ranking of business types based on the number of “hits” on their site. This ranking is not based on the actual sale of businesses.

Top Ten Main Street Businesses for August 2011

E-Commerce Businesses
Restaurants
Convenience Stores
Websites
Bars

Read the rest of entry »

Posted on 9/20/2011 10:59 AM By businessesforsale.com
In: [Hot Business Lists] | No Comments »

The Independent Contractor

The following article provides some up-to-date information on the independent contractor status. Business brokers in states requiring real estate licenses are probably safe. The real estate lobby through the National Association of Realtors (NAR) is powerful and has battled the appropriate federal committees and those in Congress. The real estate industry is the only business exempted, as far as I know. I believe that real estate agents are really employees: they work for only one employer; they must follow the dictates of the owners of the firm; they can’t work for any other firm at the same time; the list goes on. So, it follows that agents that work for business brokers and follow the same rules would also be exempted from independent contractor regulations. The states really call the shots since they require a real estate agent to follow certain rules and be employed by only one broker, etc.

Read the rest of entry »

Posted on 9/15/2011 9:03 AM By Tom West
In: [Legal & Tax Issues], [Office Management] | No Comments »

Franchised Sandwich Shops

Following is a draft of the information we are gathering for the 2012 Business Reference Guide. Sandwich shops are good sellers for business brokers. Buyers like them because they are easy to operate, the hours are better than most quick service food operations; the prices are reasonable, and they are generally located in a shopping center and have a limited menu. Listing sandwich shops can be very profitable. Here is some information that might be helpful. Although the information is based on franchised operations, it can be relevant to non-franchised shops also.

Read the rest of entry »

Posted on 9/14/2011 4:03 PM By Tom West
In: [Franchises], [Pricing & Valuation] | No Comments »

We Sell SME’s

Our focus is on selling SME (Small and Mediumsized Enterprises) – and over 80% of our sales are in the $10,000 to $500,000 price range. We tend to peak out at $5 million.

We like SMEs because they are generally owner-operated businesses and we understand them. There are a lot of them out there. 98% of New Zealand businesses are SME. They are different.

SMEs have different value drivers than large companies. They provide employment to their owners (and possibly family too), independence, security, challenge, and lifestyle – as well as the opportunity to earn good profits and future capital gains.

SMEs are important to New Zealand’s economy – they are the engines of national economic growth and job creation. All big businesses start small and we have seen some wonderful success stories with buyers of SMEs becoming millionaires.

Posted on 9/13/2011 3:31 PM By Clyth MacLeod
In: [General Business Brokerage], [Office Management] | No Comments »

KPI’s

With the tighter times in the last 3 or 4 years, many businesses have tidied up, become more efficient, and focused more on profits. While you cannot cut your way to prosperity, they have controlled costs and kept a much closer eye on bank balances, credit control, and cashflow.

Most businesses have just a few really important figures. These are Key Performance Indicators or KPIs. They will be different for different businesses but can provide quick feedback and early warning on any potential problems.

KPIs for our business brokerage are sales, new listings (i.e. stock on our shelves), conditional sales (future income), number of salespeople, marketing spend (a major variable), and estimated profit. Based on our annual budget we have figures for each category and results for each are posted in one of 3 columns. Crisis, Expected, or Exceptional. If a figure falls in the "expected" column then that is good, we sleep well. If it is in the "exceptional" column we celebrate, but if it is in the "crisis" column, we are alerted to where our urgent focus must be. Our KPI sheet hits my desk on the 1st day of each month and I regard it as our most important performance check. We "borrowed" the idea from a book on Domino’s Pizza some 20 years ago – thank you.

Posted on 9/8/2011 1:25 PM By Clyth MacLeod
In: [Office Management] | No Comments »

Home Based Franchises Require Something Extra

There are a number of advantages in owning a home based franchise. However, there can be disadvantages as well. Franchisees and franchisors should focus on the pros and cons of home based franchises when making their respective decisions.

A home based franchise operation can offer a number of advantages for franchisors and franchisees. Since the franchisee doesn’t need to locate and pay for a “bricks and mortar” location the initial investment and on-going operating costs will be lower and because it’s a home based location there will be less equipment costs. The time needed to start-up the franchise is usually less compared to a franchise with an offsite location. The overall investment in a home based franchise is typically lower than for other franchises and has the added appeal of the franchisee being able to work from home. These features should make it easier for the franchisor to sell franchises since they can choose from a higher pool of candidates.

A leading franchise advertising site lists 80 home based franchise opportunities with the following investment breakdown:

Read the rest of entry »

Posted on 9/1/2011 11:05 AM By Ed Teixeira
In: [Franchises] | No Comments »