Mergers & Acquisitions Advisory

A Neumann & Associates, LLC

September 18, 2020

TOO LATE TO SELL? NO!

By Jeremy Albelda

work-girl-professional-furniture-conversation-stressed-1372362-pxhere.com_

Even before the Coronavirus crisis hit our families and economy, we were hearing from business owners that were fearful about going through another recession and were thinking about selling their business.

As Achim Neumann, President of A Neumann & Associates, LLC. states – “the Great Recession of 2008-2010 put many out of business and challenged a great many more just to survive.  With the economic expansion that followed over the next decade, many firms were able to recover and thrive to the point where they had significant value and appeal in the marketplace.  Those owners were also 10 years older and, also 10 years closer to retirement.”

Now, we are all trying to navigate Covid-19 and protect our families, employees and companies.  The bottom line is that we are now in that “other recession” that was feared and those older owners are asking themselves whether or not it is too late to sell and retire as they had planned.

For most, the simple answer is NO.  It is not too late.

While each business is unique and carries its own set of strengths and weaknesses, there are some prevailing market conditions that set this time apart from the 2008-2010 economic downturn.  First and foremost, this is an external health crisis that has severely impacted our economic foundation as opposed to the foundational economic/banking crisis that occurred a decade ago and destroyed businesses from within.

Even though Covid-19 has adversely affected everything about a business, it is important to keep these current facts in mind:

  • The underlying economy has been strong, and most analysts feel that any recession will be short-lived with expansion returning to pre-Covid levels once vaccines and therapeutics are available. This is not to minimize the devastation.  Rather, it is to point out that if the company had a strong foundation with high demand for its products and services going into the health crisis, it should have a strong foundation coming out of it as well.
  • Strong business valuations are being maintained so far in 2020. Even though consumer and corporate spending is severely down, many business owners have been forced to increase productivity, develop creative solutions and actually increase profit margins.  For the most part, current appraisals are treating 2020 as an aberration and “normalizing” financial performance accordingly.  Simply put, in terms of value, strong businesses are not being unduly penalized for a pandemic that was not of their making.
  • Buyers and investors are plentiful and aggressive. As has been the case for the past few years, buyers outnumber sellers 5 to 1 and there is a tremendous amount of money on the sidelines looking for an investment home.  Individual buyers, complimentary organizations and private equity investors are all seeking historically sound profitable firms in strong sectors that have significant growth prospects.  This has not diminished in any way during this health crisis.
  • Bank lending is widely available, and the credit markets are foundationally strong (in stark contrast to a decade ago). Interest rates are at an all-time low and SBA incentives are actually providing a tremendous opportunity for buyers to invest in privately held firms during this time.  The banks are in business to lend money for investment and with the full backing of the Fed, they are doing just that.

While there are striking similarities between the 2008 recession and the current Coronavirus crisis, it is critical to recognize the differences and how they affect a business owner looking to sell.

“Even though this current period has been extremely challenging (to say the least), retirement plans should not be discarded completely,” adds Mr. Neumann.  “The current environment for valuations, investors and bank lending provides a strong platform for exit strategies and business transactions.”

If you had thoughts of a sale of the company prior to March of this year and have gotten your feet back on the ground so to speak, you should certainly pick up your discussions regarding the current value and marketability of the firm.  The buyers and the banks are waiting – it is certainly not too late to pursue a transaction and meet your goals.

About A Neumann & Associates, LLC

A Neumann & Associates, LLC is a professional mergers & acquisitions and business brokerage firm having assisted business owners and buyers in the business valuation and business transfer process through its affiliations for the past 30 years. With an A+ Better Business Bureau rating, the company has senior trusted professionals with a deep knowledge based in multiple field offices along the East Coast and has performed hundreds of business valuations in its history. The firm’s competitive transaction fees are based on successfully completing transactions. For more information, please contact A Neumann & Associates at 732-872-6777 or info@neumannassociates.com

Leave a Reply

Your email address will not be published.

17 + 10 =

Any questions? Please contact us at 732-872-6777
Call Now

Client Testimonials

“Working with Marc and his company was a pleasure. What I thought was going to be a just another one of those pushy sales companies was just the opposite. Polite, knowledgeable, and a pleasure to talk to and deal with. Marc handled most of the interaction and he has one of the greatest demeanors. Again, it was a pleasure working with him and his firm.”

Douglas DiCeglio

“I recently completed an acquisition using A Neumann & Associates. Tony Valentino was very helpful and accessible during the entire process. They do a thorough job vetting both parties and got us to the finish line.”

Srini Mudambi

“Claus out of Florida helped us with the sale of our business. We had never done anything like this and him and his team walked us through the process from start to finish. We had some challenges through the process and Claus continued to show up even in the difficult conversations.”

Colby Harris, Co-Owner, Del Mar Designs

“Claus Madsen thoroughly helped us with selling our company. From the 1st introductory meeting explaining to us what was possible, to providing us with resources to assist with the sale. Claus was invaluable throughout the whole sales process. Claus was with us every step of the journey and always made himself available for any questions or issues that came up along the way. If you are interested in selling your business, I encourage you to reach out to Claus and the ANA team so that they can let you know what’s achievable. These guys will make it happen!”

Ron Harris, Co-Owner and Vice President, Del Mar Designs

“A Neumann & Associates is the only business broker I would use or consult with. They have assisted with 3 business sales over the past 15 years with me. They are honest and sincere and have always performed better than my expectations. They are the only one i would use for the sales of my businesses.”

James Belanger, Business Owner

“I wanted to take a second to commend the exemplary customer service from both you [Karin Neumann] and Mr. Valentino. It’s both a rarity in the industry, and very much appreciated.”

Andrew G., Investor

“We worked with Neumann & Associates to investigate the purchase of a research company in 2010 and found Achim to be capable, forthright and realistic. His depth of experience enabled us to fully understand our options, offering creative options that might enable the acquisition. While we didn’t acquire that particular company at that time, we know exactly who to call whenever we’re looking to buy or sell a business.”

Daniel Coates, Buyer

“Purchasing a business through this firm was a pleasure. Gary was very professional and transparent throughout the entire process. I look forward to working with A Neumann & Associates in the future.”

William Klemens, Buyer

“I utilized A. Neumann & Associates to assist in an M&A process. They are VERY thorough in using their time-tested process to calculate the value of investment opportunities, a process which provided a very detailed explanation for the value of the potential opportunity. Additionally, they also went above and beyond to extend other services including connecting with others who specialize in your industry and can assist with necessary steps including legal and accounting. Highly recommended!”

Edward Lane , Business Owner

“I recently contacted A. Neumann and Associates about getting a valuation of my business done. I spoke with Achim, who explained the process in detail. He had his colleague Gary come to my office in order to get a clear understanding of my business, and what I was hoping to accomplish. His patience in answering all my questions and his knowledge of the proper way to market my business gave me great confidence that this is the firm I will be using when the time comes for me to sell my business for max value. They gave me great insight into the steps I need to take now to get the best deal in the future. I highly recommend this firm to anybody who wants to sell now or down the road. They not only know their stuff, their actually just real nice guys.”

Robert Kardane, Business Owner
view all testimonials

Contact A Neumann & Associates, LLC

If you are considering selling your business, please contact us to learn more about our comprehensive service spectrum. Our experienced professionals will answer all your questions about selling a privately held business in complete confidentiality. Please fill out our contact form, or call us at 732-872-6777. We will contact you directly and will never identify ourselves to your employees.

call us now
Contact Us for a Free, Confidential Consultation

Experienced M&A Advisors available

Full Name
Email Address
Phone Number
Message