Are you a business owner thinking about retiring or changing your career? Or maybe you’re at the other end of the spectrum, thinking about buying a small or medium-sized business.

I was recently interviewed on the subject of buying and selling a business by Norman Jack for CFRA Radio’s Experts on Call program.

The interview is divided into four segments that you can listen to or choose to read the transcript (below in this article), according to your preference.

Here’s what we covered:

Segment 1

• Why this is an exciting time for business owners who want to sell and retire or move on to other things in life AND for buyers.
• The process of selling the business

 

 A franchise is a business that is built for someone else. Thinking about your own business in those terms can give you fresh perspective on what will make your business more sellable when you’re ready to go to market. And acting on that insight will make your business more productive and profitable in the here and now.

So with that in mind, and legal matters aside, imagine what it would take to franchise your business. Does it have a proven system of business success that is teachable, trainable, reproducible and repeatable?

Maintaining the quality control and consistency across a franchise network can be a challenge, but it is a necessary one when it comes to the customer experience.

 

 

Branding and consistency become key factors in success in franchising.

As we move into spring a good many of us get that restless feeling prompting us to seek change in our lives. For many business owners the change involves selling their business.

We are seeing an increasing number of owners moving towards retirement. The recession held back many retirements as owners had lost some of their savings and their businesses were underperforming, resulting in a lower sale price and a shortage of funds for retirement.

Based upon how 2014 has started, this situation appears to be rapidly changing.

We are seeing many more successful businesses coming on the market and we expect this trend to continue for some years to come:

- Some 35% of business owners are now 65 years or older.

- The average small business owner retires at 71 years of age.

- As baby boomers are hitting 65 years of age the number or retirements is beginning to increase, and for the next 10 years this number will soar.

 

 

 

 

 

What would you like to do after you sell your business?

Business owners will be selling into a very competitive marketplace, which means it's likely that only the most attractive and well-prepared businesses will sell for what they're worth.

You'll want your business to be one of them. Here are our top 10 tips to sell your business AND protect its value, increase your personal wealth and reduce the taxes you will need to pay on the proceeds.

And here's an extra one to start you off—for the best results, start planning three and a half to five years ahead, allowing at least six months to analyze the business, two years to build value and take advantage of tax strategies to maximize the proceeds of the sale, and another year to sell.

 

 

How many of you remember Victor Kiam, the businessman who liked his Remington shaver so much he bought the company? Well, the three Inner Circles I experienced in the U.S. impressed me so much that I bought the company – at least the Canadian Master Franchise.

Kiam said (and showed), "Entrepreneurs are risk takers, willing to roll the dice with their money or reputation on the line in support of an idea or enterprise. They willingly assume responsibility for the success or failure of a venture and are answerable for all its facets. The buck not only stops at their desks, it starts there too.”

Membership in an Inner Circle group can substantially improve the odds for entrepreneurs like us rolling the dice. In a recent member survey, 97% reported better decision making ability; 75% reported higher revenues AND profits; 71% reported better work/life balance.

So what is the Inner Circle and its life- and business-changing power?

 

Just like home buyers, prospective business buyers spot what’s worn, cluttered and dated. Like moths to a flame, they’re drawn to the defects, adding up renewal and revitalizing costs. Some may see the business as an opportunity; all will see it as worth less money.

Like financial factors and organizational factors, operational factors can add or take away value. We’ll start with the most conspicuous.

Clean up the shop, warehouse, office, store:

• Dirt and dust say you don’t care. Show your customers and staff that you do. Clean and freshen up all store, work and rest areas.
• Do your assets need repair or replacement? Deal with it.
• What about your inventory. Do you have more than you need to sustain average levels of sales? Sell off the excess. Take the same approach to eliminate unneeded files, procedures, equipment and programs.

Do you already own a business? Is much of what you need to operate your business “in your head”?

Businesses that rely on their owners for success have less value because replacing the owner is much more difficult and they are not ready for growth. Yet that’s how most small businesses still operate today.

Working ON the business, as well as IN the business can be hard when you are putting in 60 hours a week to keep the business running.

Many business owners are happiest applying the technical skills that got them there in the first place – the mechanic who started a garage or a baker who opened a bakery. They are in their comfort zone. Dealing with their business vision, market segmentation, planning, process development, systems development, documentation, training programs, quality standards, sales processes and collateral, developing customer feedback mechanisms, employee encouragement, tracking systems and the like is not what got them started and it may not be what they enjoy. Yet it’s what makes the difference between a successful very small business and a great business that is poised for growth and highly saleable. The existence of these processes and systems adds great value to a business. Lacking them reduces the business worth.