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SPECIALIZING IN MERGERS AND ACQUISITIONS, VALUATIONS AND ADVISORY SERVICES

 

Being one of the leading firms in our industry, we are best equipped to help you because of our background and years of experience in working with business buyers and businesses of all sizes and types. This includes retail shops, restaurants, franchises, service businesses like distributing and printing, all kinds of manufacturing, laundries and many others Exodus Business Solutions can help you find just the right small business for sale.

Helping Buyers Find the Right Choice

If you need some assistance or advice in reviewing a listing, formulating an offer; negotiating a certain part of the deal, investigating or valuing a particular business, reviewing the financials, or if you simply want an unbiased expert opinion about a particular situation where you’re not positive what strategy to use, we will immediately provide you with our experienced input and assessment.

Your business purchase or sale information will be handled by experts and conducted in a confidential manner. We aim to help these buyers find a business quickly and efficiently.

With this service you’ll have immediate and unlimited access to our team of business buying specialists to help you with situations or challenges you encounter. Our experience extends across a wide variety of industries and company size including manufacturing, distribution, retail, medical (hospital-based, primary care, internal medicine, surgical, other medical specialties & dentistry), financial services-broker/dealers, investment advisors, financial planning, and architectural, engineering, accounting, legal, and other professional firms, hi-tech and non-technical firms.

If you want to go about this the right way, these are the four critical steps you must follow:

• Step 1 – Educate and prepare yourself fully for each stage of the buying process.
• Step 2 – Determine with absolute certainty what type of business is right for you and then focus your search strictly on businesses that make sense.
• Step 3 – Negotiate all of the details to ensure that you put together a deal that makes sense today and down the road.
• Step 4 – Investigate every aspect of the business for sale, the industry, the customers, the financials, the suppliers, the employees and the competition to be sure that you learn everything before you buy!?

Let an Exodus Business Solutions professional help you find the most appropriate business opportunity. Click here to learn more.

The goal of most entrepreneurs is to be successful, watch the bottom line, reduce the tax burden, and eventually sell their business for a premium. Unfortunately, most entrepreneurs will not end their career so illustriously. The fact is most business owners will not make the decision until its to late. According to the Small Business Administration, your business will transfer to family, be sold, or closed down. Statistics show that one out four of businesses will sell in the United States. The biggest reason businesses do not sell is because the ownership never made the decision.

Helping Businesses Make the Right Choice

Exodus Business Solutions specializes in preparing small and medium size businesses for sale and implementing a sophisticated sales effort to obtain a premium price for your business. By conducting a valuation and preparing a professional marketing package before marketing efforts begin, we quickly attract qualified buyers. Our experience proves, the valuation and marketing package facilitates buyer financing, a critical component of most business transaction.

We believe our business model will be the standard model for most business brokers and intermediaries in California. Buyers are becoming more sophisticated and expect the financial records to be compiled in a professional manner. This will limit the amount of time buyers spend gathering and examining company records and allow for smooth and timely transaction. Everyone wins under this scenario.

Buyer Profiles

The Industry Buyer is typically a competitor and knows your business, customers, and industry. Many times they stand to gain the most by acquiring your business, but as often as not they are among the lowest price bidders and buyers of last resort. They generally determine price based upon the value of the business assets. They are the best buyers when they have a strategic reason to buy and know that you know the reason. Our job at EBS is to know the strategic reason and to drive the price they pay above asset value

The Financial Buyer is typically an individual looking to be his own boss. They expect a living wage and take pride in building upon your success. Our experience indicates the majority of these individuals are hard working family types with excellent credit ratings. These buyers constitute the largest pool of buyers for the vast majority of US businesses that gross less than one million dollars a year. These businesses form the backbone of the US economy. EBS has access to a large pool of these Financial Buyers. These buyers typically base value on the company’s historical cash flow.

The Strategic Acquirer is generally a larger business that has identified a strategic reason to be in your business. They currently may or may not be a competitor. This buyer is our buyer of first choice as they pay the highest prices. However, we base our valuations upon what Industry, Financial, and Corporate Buyers will pay to avoid the distortion caused by Strategic Buyer methods

The Corporate Acquirer typically comes from a large company background. They include high net worth individuals or group of individuals, investor groups, and small corporations. They are usually familiar with your business and quite sophisticated. Their primary focus is on current and future earnings. EBS maintains a database with many of these corporate acquirers.

We love helping people prepare for the most important decision for their business. Doesn’t our careful approach make a lot more sense?

What is a small business? According to the SBA a small business concern is “one that is independently owned and operated and which is not dominant in its field of operation.” The law also states that in determining what constitutes a small business, the definition will vary from industry to industry to reflect industry differences accurately. But what opportunities are out there, and what are the pros and cons in the different types of businesses?.

Smart Entrepreneurs Make an Appropriate Choice

The number one question should be in choosing a business venture: “have I ever done this before?” Most successful businesses are a natural outgrowth of a previous position working in that industry, or by expanding a leisure pursuit into a paying enterprise. The best opportunities are sometimes right under our nose. Don’t think you have to fly all over the country when there are plenty of local opportunities to choose from. Here are some of the pros and cons of each type of endeavor:

Distribution – When it comes to getting goods from the thousands of product manufacturers into the hands of consumers worldwide, the role of wholesale distributor is a crucial one, because neither manufacturers nor the businesses that buy their products for resale could survive without them. Quite simply, distributors are middlemen. They buy products from manufacturers, then sell them to retailers at a profit. This type of business may allow for great flexibility, low inventory investment, and stability in changing market conditions.

Manufacturing – Manufacturing is defined as the making or processing a raw material into a finished product. The profits traditionally associated with manufacturing are very attractive, and for manufacturers who have carved out a niche for their products, the business may have a stable market window which lasts decades.

Professional services – The service industry in America is growing rapidly. Professional services are provided to both business and consumer markets and make up a large part of our economy. A services business might be a large insurance company, or just one individual. Marketing an intangible, such as a service may be a challenge for some people. As a professional service provider you may face special challenges promoting yourself to potential clients.

Retail Businesses – Over ½ of all of today’s workers consider opening a retail business during their lifetime. That sub shop or hardware store might look interesting from the outside, but lifelong retailers know that survival requires long hours, patient bankers, deep pockets, and boundless energy and determination in addition to keen financial skills and location, location, location. 4 out of 5 retailers discover the painful way that a lot of their hard work is mostly for their landlord. “To make a small fortune in retail, invest a large fortune” is the old joke.

Some Possible Advantages of Buying A Franchise

Turnkey System – A franchise system is a proven system for operating the business and generating profits. If your skills are weak in sales & marketing or operations then a turnkey franchise may be best.

Franchise Support – Small business owners often have very little support or lack a support team with business acumen. Buying a franchise offers the opportunity to share your challenges with other like-minded entrepreneurs. As franchise companies state, you’re in business for yourself, but not by yourself.

Lower Inventory Prices – The collective buying power of a franchise group allows for lower costs in purchasing inventory and equipment. Independent businesses usually have less bargaining power with suppliers.

Brand Name – The more established franchises provide a market awareness & brand name to franchisees. This can amount to great savings in customer acquisition costs and allow for more time in the operation of the business.

Easier Staff Recruiting – Finding good employees is a critical success factor for many independent small business owners. A franchise business with a recognized name will have greater recruiting pull than an unknown business entity.

Possible Downsides to Buying A Franchise

Less Freedom – Franchisees are required to share financial information and conform to uniform operating procedures. An independent business owner makes all the business decisions.

Higher Start-Up Costs – Buying a brand name franchise is often beyond the financial capability of many potential business owners. An independent business may be more realistic financially if the owner is willing to focus on building a strong business operation.

Royalties – Each and every year franchisees are required to make royalty payments in return for support in operations and advertising. Some franchisers may not provide all the necessary resources for the success of your particular location. Talk to other franchisees for feedback on the level of support they receive.

Broken Promises from Corporate – The franchiser may not have the ability to provide market or field support. Owners can become reactive and expect the head office to solve all the problems. In your own business, the only person you count on is you.

The buying a franchise option works best for individuals who work well in a team environment and have limited business & industry background. For others, the road to “true” entrepreneurship could represent the ideal path to business ownership. Take the time to consider your options. Buying a franchise may be right for you.

Have you entertained the thought of buying a business or franchise or are you an owner looking to sell your business?

Business brokers, like real estate brokers, bring the buyers and sellers of businesses together. More business owners nationally choose to use a broker than to sell a business themselves, but some business owners do handle sales on their own. Try to use a business mergers and acquisitions specialist who focuses on business sales — in other words, avoid someone who does it part-time while selling real estate. A broker is an agent employed to effect bargains and contracts, as a middleman or negotiator, between other persons, for a compensation commonly called brokerage.

Finding the right business specialist is important if you are thinking about selling. Attention should be paid to success rates and experience, and determine how committed the professional is to selling your business. A business intermediary can bring more prospects to your business than you could ever do on your own. They’ll also separate the buyers from the lookers, which can save you valuable time. And, in most cases they will get you a better price than you could on your own — more than justifying the fees for service.

What type of professional should actually handle the sale?

What is your background/experience? It takes time and experience to be able to understand the nuances of businesses. The average Mergers and Acquisitions Specialist is 55, and for good reason. A competent professional needs experience in valuation, a fair amount of accounting experience, knowledge in the legal aspects of selling a business, salesmanship, and patience. In short, the firm or person you are looking for has been around the business block before entering the profession.

What services do you provide? – The M&A specialist should offer to help you price the business, and should be able to show you how to package and market your business. After you’ve heard two or three proposals, you’ll get a good idea of the type of services available to you. Remember you are hiring a sales professional with strong financial skills, so look for signs that your M&A specialist is just that.

Can I talk to the owner? – If you’re not personally dealing with the owner of the firm, it may be a good idea speak to him or her. Ask him or her the questions you asked of the person whom you initially contacted. Do you get the same answers? Also, ask what kind of recourse you have if you’re not getting any activity on your business.

What kinds of tools do you use to research buyers? Before the Internet, if you wanted to sell your business, you were probably stuck looking for buyers in your city or area. Today, the Internet has made the world smaller for sellers, and a good M&A specialist takes advantage of that. Additionally, the M&A specialist should have at his or her disposal research tools and use them to find buyers and general information about the profession or industry in which the seller is active.

How will you market the business? – Discovering what tools a firm has in its marketing arsenal will help you determine just how committed they are to selling. Every business needs a little different approach to its marketing campaign and every business brokerage firm is a little different, so there are many combinations of campaign strategies that might be appropriate.

Look for a variety of ways to that the broker reaches sellers – ads in local papers and trade publications, listings on Web sites as www.bizben.com. It’s also a good idea to get on the Internet yourself, act like a buyer, find out where listings for businesses similar to yours show up, and then ask the broker if they list there.

Ask to see the printed marketing materials the broker puts out for clients. Look at their brochures and presentations, assessing completeness and how well-written they are. Ask whether they approach similar or complementary businesses about mergers, which shows you they are casting a wide net for buyers.

There are many business brokers in California but Exodus Business Solutions can help you with their unique expertise to sell or buy a business in Southern California and beyond. At Exodus Business Solutions we can also help you price your business properly, tell you how you can make it more saleable, and simply be there as a resource throughout the sale.

For additional information call 619-688-0007

Business mergers and acquisitions are commonplace in our economy. One of the main reasons given for a merger is that it draws on the strengths of each company, who together can offer more than they can alone. Benefits of an acquisition typically include lowering risk by avoiding the start-up period’s initial losses and less capital depreciation.

Reasons for a Merger
Consolidation is everywhere and in all industries. Mergers are being announced at an unprecedented rate, and we can expect to see many more mergers during the next few years. An increase in the size of a firm can mean greater financial resources to cover the additional costs that may be necessary for the business to succeed in today’s business environment. Some of the factors which may encourage a merger…

Buyers may be motivated to merger activity for:
• Economic Efficiency Considerations: Companies want to gain (i.e., reduce average costs) from larger-scale operations. Merged firms can also have greater specialization of equipment and operators, high-speed automation, and high-tech equipment.
• Risk Spreading Through Diversification: Reduce risk of loss and/or failure by spreading risk throughout more companies and capital.
• Growth and Personal Aggrandizement: Some managers make it their personal goal to be the largest and most powerful company and achieve this through mergers.
• Monopoly Power: Firms merge to create or enhance monopoly power. Incentive? All of the individual firms worth more as a group than as individual firms
• Perhaps as a result of a general change in business climate
• Management retirement considerations
• Business succession planning
• To gain newer technologies and methods more quickly to keep up with their industry
• Larger market share through eliminating the competition (growth)
• Access to other markets – regional or channel marketing (growth)
• Additional, complimentary products or services which “fit” with the acquiring company

Tips for companies considering a merger.
• Deal from a position of strength. Don’t wait till things are bad and you need the money.
• It’s important to find a like-minded company which is a good match in terms of culture and personality.
• Explore many possible partnerships. Whether you’re shopping for a buyer or looking to buy, establish your criteria for evaluating deals.
• You need to explain how each employee’s role will change and communicate as things evolve.
• Let employees know what you are up to. During the exploratory phase, you don’t have to give details, but once the deal is done, explain the reasons behind the merger.
• Pay attention to employees. Once the deal is done, every employee wonders, “What will happen to me?”
• Once the papers are signed, the task of integrating the two organizations should be quickly handed off to the managers. Firms considering a merger should however take considerable care. The worst form of merger is inevitably where two firms with significant difficulties merge without proper planning, potentially causing their problems to be magnified. You will want to retain an experienced, professional firm to help manage your merger. For additional information call 619-688-0007.