Mergers & Acquisitions Advisory

A Neumann & Associates, LLC

July 7, 2021

Why Sell Now ?

By Achim Neumann

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Selling your business could be the most pivotal event of your lifetime; so first make sure you know why you want to sell. Zig Ziglar, author and motivational speaker puts it this way: “Unless you have a definite, precise, clearly set goals, you are not going to realize the maximum potential that lies within you”. Here are the most common why-considerations you must have sorted out before you know if want to sell:

Retirement – You may have successfully run a business for many years but now you want to retire and start to reap the rewards of your hard work.

Family Obligations – Maybe you started your business as a single man or woman and then the growth of your family led you to want to sell your business and focus more time on family.

Business Expansion – Investors love to buy already-flourishing companies. Sometimes it is best to sell while you are still ahead of the game and before your business heads south for whatever reason (within your control, or not).

Decline in Profits – Your business might be going through a dry spell that you cannot recover from and it might be an opportune time to sell to someone with a more modern vision and capital injection to get things running again.

An Offer You Cannot Refuse – There might be an offer from your competitor that you just simply cannot refuse. You might be thinking of moving, and someone makes you a great offer. You take it because you know it’s an attractive deal.

Personal Health Reasons – Life is not always predictable and if you are diagnosed with a debilitating health condition, it may be a good time to consider selling your business to prepare for your unpredictable days ahead.

Business Landscape Changes – Look at 2020 and how quickly the business landscape can change in an instant. Online industries flourished while the hospitality and tourism industries struggled and many businesses ended up closing permanently.

New Opportunities – New opportunities always present themselves at opportune moments. An offer may come for that dream business you have always been waiting for therefore you may need to sell your current business to make way for the new one.

Under any of these scenarios, it is decision time – and the answer is very simple: there is never a ‘best time’ to sell a business, but there is always a ‘right time’ to sell, and that is when you have your ‘why’ figured out.

It is never too late even if it does not feel like the right time. Every business has strengths and weaknesses, and for some it may be good to sell while you are ahead and for others good to sell due to the uncertainty that lies ahead.

Even in a global crisis, there are always those who have unlimited cash it seems to invest and buy businesses. Bank lending options and low-interest rates make it possible to buy in a “seller’s market”. Even now during this Pandemic, even though many businesses failed, and consumer spending was at an all-time low (and now resurging), the underlying economy has still been strong with many buyers searching for new investment opportunities.

Avoid making silly mistakes in the process of selling your business and be patient. Do not be impulsive. Clever and careful planning with your broker will prevent you from making mistakes that will negatively affect the outcome of a sale. Top three mistakes to avoid are:

Not finding the right brokerage

Look for M&A advisers who will work alongside you and understand the unique needs of your business. Do not be in a hurry and choose the first broker who comes along. Do some research ahead of time of companies who have handed over businesses successfully in the past.

Asking the wrong price

Setting an unrealistically high price will lead you nowhere! Equally setting it too low will not help you but leave “money on the table”. Get a qualified fair market value from an independent valuation company but do not use your accountant, lawyer, or inhouse accountant for such – they simply do not know or have the experience.

Waiting too long to sell

Do not wait for a best time, as that cannot be found, and just listen to your “why”. If you wait too long to decide the buyer may move on to another opportunity. Indecisiveness is not working in your favor. If you have decided to sell, commit to the process fully

Preparing for a Sale

The key to a successful transfer is a thorough preparation and making sure your M&A advisor does extensive research into potential buyers both local and international, and looking at investors and buyers outside of your industry

When you are preparing for a sale, focus on your company’s unique strengths and the opportunities for growth in the future. You must preserve what sets your business apart from the rest, define the competitive advantage. Let your M&A Advisor gather all necessary information as well as preparing a professional management presentation. Accurate and dependable record-keeping is essential for a smooth handover.

Ensure you have ongoing sound advice and negotiation services that run smoothly throughout the entire process. When you stay focused on running the business and your M&A Advisor stays focused on the selling your business, there is no reason you cannot experience a smooth transition and have a successful handover at the end of the day.

Ultimately, the decision as to when to sell is a very personal one. Selling your business is very exciting and could open many new avenues for you and your family that you have not even considered. Just ensure you have a good M&A advisor on your side. Whenever you do sell, it will be the right time if you have your ‘why’ sorted out, go about it the right way, and get the right people and team into your corner.

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

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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

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James Belanger, Business Owner

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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
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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.

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