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What to Expect During the Sale Preparation Process Transworld is the largest business broker in the US, and a franchise with over 300 locally owned offices across the country. Our sale process has been developed over 40 years of success. There is usually no charge for an Initial consultation and Broker Business Valuation. We will work with you to prepare your business for sale. We Collect Information, Package the Business, and Market the Business We prepare you for Due Diligence, Qualify Buyers, and Recommend Professionals to advise you. Tags: Selling a Business, Business Brokers, Broker Fees, Legal Fees, Accounting Fees, Financial Planning Fees, Business Sale Costs, Broker Fees, Transworld Business Advisors

What to Expect During the Sales Process As the selling process begins, we prepare you for Due Diligence, Qualify Buyers, and Recommend Professionals to advise you. We handle all Contact with the Buyer and Facilitate Offers. Then we Facilitate Due Diligence Inspection and Landlord Approvals. As your Business Broker we help the Buyer get Financing and help the Seller through the process. Finally, we help provide the documents required for closing and coordinate the closing process. Tags: Selling a Business, Business Brokers, Business Marketing, Business Sales, Business Brokers, Transworld Business Advisors Short Bio: Bill Kelly is a Senior Business Broker and Franchise Consultant for Transworld Business Advisors of Richmond, VA, and a Licensed Virginia Commercial Real Estate Agent. Bill has been a lifelong Entrepreneur and has personally started/purchased and sold eleven businesses. He lives in Richmond, Virginia, with his wife Rebecca, and two daughters, and one granddaughter. Contact links: bkelly@tworld.com

Episode 13 Why do Some Businesses Sell Quickly while Others Never Sell? ​ Setting realistic expectations on the sale of your business. Start by asking yourself if you are selling a money-making system or a job? Most Job Based Businesses are bought by either a First Time Buyers or Strategic Buyers. First Time Buyers are looking to gain more control over their financial future in an industry they have experience in. Strategic Buyers usually already have a successful business but want to acquire more cash flow, a larger territory, additional products or services, or key customers, and employees with experience in their industry. Job Based Businesses often require more time for the Broker to find qualified Buyers and educate them on the business’s past performance and future potential. They will usually require more time finding financing and may require mor Seller assistance after the sale. Strategic Buyers usually know what they are looking for and generally may close faster. They already know how to run a business so their Due Diligence list will be more detailed. Tags: Selling a Business, Business Brokers, Strategic Buyers, Selling Your Job, Franchise Model, Buying a Business, Transworld Business Advisors

EPISODE 14 What is Included with The Sale of My Business? ​ The Seller sets the terms of the sale, but the Buyer has the final say. When selling your business consult with your business broker to decide the terms you want for the sales of your business. Terms include items such as: personal property you retain, payment for receivables and inventory, key employee retention, length of Buyer training you provide after the sale, and more. Generally, when you sell your small business, the cash on hand and receivables belong to the Seller at closing. However, in some cases the Buyer will insist on leaving enough working capital to maintain the business after closing. Work in process is usually included with the sale but is always negotiable. Inventory is usually purchased by the Buyer and may be handled in a separate sales agreement. Personal Items always remain the property of the seller. Other business assets, such as personal vehicles, small equipment, tools …etc. can be carved out of a sale agreement before closing. Let your Broker know about these items as soon as possible. Valuing and receiving payment for receivables can be tricky. In most cases it is best to discount the value of receivables to allow for their safe collection and have the Buyer purchase them at closing. Other terms like key employee retention and length of time you allow for Buyer training after the sale are negotiable, but again, always let your Broker know if these issues as soon as possible. Tags: Selling a Business, Business Brokers, Included with the Sale, Buying a Business, Transworld Business Advisors

Episode 15 Do I Need to Sell my Corporation with my Business? Usually not, but it may be necessary. There are two issues to consider when deciding whether to sell your business corporation or just the assets. What is the tax impact on both the buyer and seller, and what are the assets being transferred? If the company is an S Corp or LLC, the tax benefits to the Buyer favor an asset sale. But if the company is a C corporation, the Seller may face double taxation when selling the assets, so a stock sale may be more favorable. In some cases, the assets being sold might be difficult to transfer, such as government contracts, certifications, and distributorships for example. In these cases, a stock sale may be required. Buyers may inherit additional risk with a stock sale. Risk for past events such as underreporting taxes, sexual harassment lawsuits, and unreported contracts can pass to the Buyer. For these reasons and more, Buyers often prefer to buy the assets of a company. Of course, a good lawyer can limit the risks transferred in a stock sale. Regardless of the risk, if your company has a large number of contracts, vehicles or licenses, the buyer may insist on a stock sale. Tags: Selling a Business, Business Brokers, Stock Sale, Asset Sale, Business Sale, Transworld Business Advisors

Episode 16 Should I Consider Giving the Buyer a Seller’s Note? If I do, how will I know I’ll get paid? A Seller’s note is an alternative form of capital. It’s really a loan from the Seller to the Buyer to help finance the purchase of the Seller’s small business. The Seller agrees to loan the Buyer a portion of the purchase price in exchange for a series of payments usually with interest. A Seller note is usually used to close the gap between the purchase price and the amount of bank financing available. SBA loans often permit the borrower to include some or all of a Seller’s note when calculating the Buyer’s capital contribution to the transaction. This type of loan can also be used to give the Buyer more confidence when purchasing a business with challenging characteristics such as a concentration of a few high dollar customers or perhaps a seasonal concentration of business. When securing a Seller’s note, it is always recommended to get the Buyer’s personal guaranty and make sure they have other assets outside of the business as collateral. Talk to your Broker to discuss various types of Seller’s notes that can be used to the Seller’s benefit. Also, talk to your CPA about the tax benefits involved. Tags: Selling a Business, Business Brokers, Business Marketing, Business Sales, Business Brokers, Transworld Business Advisors Short Bio: Bill Kelly is a Senior Business Broker and Franchise Consultant for Transworld Business Advisors of Richmond, VA, and a Licensed Virginia Commercial Real Estate Agent. Bill has been a lifelong Entrepreneur and has personally started/purchased and sold eleven businesses. He lives in Richmond, Virginia, with his wife Rebecca, and two daughters, and one granddaughter. Contact links: bkelly@tworld.com

Setting realistic expectations for Buyers seeking information about a business is critical. Buyers want information fast. They want all the financial details first and worry about the operations later. Controlling the dissemination of information and parsing it out in an orderly way, is more beneficial to the Buyer. The process to obtain information about a business should always require adequate information and growing commitment from the Buyer. Buyers should always sign a non-disclosure agreement and provide some basic qualifying information for the Seller to review before the business information is shared. Sometimes, the Seller will want to approve the Buyer’s information before sharing an executive summary. Review of Transworld NDA and Buyer Profile. Drive by inspections must be pre-arranged by your Broker. Contact with the Seller or employees at this stage is never allowed. First contact with a Buyer should always be facilitated by your Broker via an internet video meeting or conference call. Tags: Selling a Business, Business Brokers, Controlling the Deal, Document Management, Buyer Profile, Transworld Business Advisors

Rely on your Broker to relay information between you and the Buyer. The purpose of negotiating with a Buyer is to receive an acceptable offer. Once NDA’s are signed, and the Buyer information approved, the Executive Summary should provide all of the information the Buyer needs to get a good understanding of the business. Business Tax returns, and other sensitive information will always be requested, but often it’s a good idea to hold some information back until and offer has been made and accepted. Carefully guarding customer lists, vendor lists, and other trade secrets is very important. Buyer’s looking for cash flow only will generally make offers based on the Seller’s income from the business. But Strategic Buyers often consider many other factors. Try to identify what type of Buyer you are negotiating with. As the Sargent on the TV show Dragnet use to say, “Just the facts Mam”. Try not to get involved in social, political, or other controversial discussions with Buyers. Always ask your Broker to moderate talks with potential Buyers so they stay on topic. Tags: Negotiating, Selling a Business, Business Brokers, Talking with Buyers, Dealing with Buyers, Buying a Business, Transworld Business Advisors

Understanding the different kinds of offers and what is included. There are four different ways a Buyer might make an offer to buy your business including a Verbal Offer, Informal Written Offer (Usually via email), Letter of Intent (LOI), and Written Formal Offer. Offers and counteroffers should always go through your Broker. If a Buyer contacts you directly, refer him back to your Broker. Your Broker make sure the offers are legitimate and the terms they are asking for are clear. An offer to buy a business usually includes the Buyer providing some amount of “good faith” or “earnest” money. Not all Buyers will want to do this. Ernest money is always held in Escrow usually by an attorney and the funds can be refunded to the Buyer or not, depending upon the terms of the offer. Once an offer is accepted, the final buy/sell agreement is usually drafted by either the Seller’s or Buyer’s attorney. More complicated the sales can require very complicated legal agreements. For smaller sales, Brokers can usually recommend an Intermediate Attorney who can represent both parties in the transaction keeping closing costs low. We always recommend you have your personal attorney review all documents before closing. Buyers and Sellers should also consult a professional Financial Advisor to understand the tax implications of selling and buying a business. As the old saying goes “ an ounce of prevention is worth a pound of cure”. Tags: Selling a Business, Business Brokers, offers to sell, offers to buy, Closing Attorney, Intermediary Attorney, Financial Advisor, Transworld Business Advisors

How long does Due Diligence take, and how much information do I have to share with the Buyer? Due diligence is an investigation of a business conducted by a prospective Purchaser before they purchase. The purpose of this investigation is to prove to the Buyer the validity of the information offered by the Seller. Typically, for businesses selling for under five million, the due diligence period lasts for 10 to 90 days, depending on the sophistication of the Buyer and complexity of the deal. With more complicated deals, it could last six to nine months. Buyers will typically want to inspect as much of the business as possible. Sellers must supply items such as: business licenses and permits, corporation paperwork, leases, contracts with customers and vendors, a range of business financials & tax returns, employee / payroll records, bank statements, business vehicle records, and more. During the Due Diligence Period in most offer and acceptance agreements, the Buyer has the right to amend or withdraw their offer. Talk to your Broker in advance and plan for the Buyer’s Due Diligence Inspection of your business. Presenting the Buyer with provable information and conservative financials initially will ensure the Due Diligence Inspection will go much easier. Tags: Selling a Business, Business Brokers, Due Diligence, Business Inspection, Financial Inspection, Business Sales, Buying a Business, Transworld Business Advisors Short Bio: Bill Kelly is a Senior Business Broker and Franchise Consultant for Transworld Business Advisors of Richmond, VA. He is also a Licensed Virginia Commercial Real Estate Agent. Bill has been a lifelong Entrepreneur and has personally started or purchased and then sold eleven businesses. He lives in Richmond, Virginia, with his wife Rebecca, and has two daughters, and one granddaughter. Contact links: bkelly@tworld.com

Episode 21 Explaining the different types of business closings. Closing can be very difficult without the proper preparation. Two Different Types of Business Sales Models. When selling a small business there are only two types of sale you can choose from. Asset Sale or Share Sale. Whether your Buyer is an internal (family, employee person or group), a management group, or an outside third party, these are the only two types of sales models you can choose from. Asset Sales include only the assets owned by the business at the time of sale. The term “assets” include both tangible and intangible items. Tangible means items such as land, buildings, equipment, cash, investments, and inventory. Intangible means items such as goodwill your business has built up during its years of operation, websites/social media sites, customer lists, patents, copyrights, and trademarks. Sole Proprietor Asset Sale. If your business is a sole proprietorship or partnership meaning it’s not incorporated, an asset sale is your only option, and it can be a level more difficult. A sole proprietorship by definition is typically a one-person business with the owner's skills and experience often representing most or all of the businesses value. Share Sale also known as a stock sale, can simplify valuing and closing a business sale because you are selling the shares of the business not just its assets. Obviously, you must be incorporated to sell this way. Regarding Taxes, in a share sale there may be some advantages to the Buyer and the Seller. Talk to your Accountant or Financial Advisor for the best way to proceed based on your particular circumstance. Liabilities In a share sale, the liabilities are sold along with the rest of the business. So be sure to talk to your lawyer to make sure there are the proper protections for you from past or future liabilities in the final sale documents. Tags: Selling a Business, Business Brokers, Controlling the Deal, Document Management, Buyer Profile, Transworld Business Advisors

Apportionment of the business resources, signing agreements, and payment. Who Conducts a Business Closing? Closing can be conducted by the Sellers Attorney, the Buyers Attorney, an Intermediary Attorney, or an Authorized Escrow Agent such as a Title Company. Though a great deal of documentation and planning has been completed prior to closing, it is not uncommon for issues to come up at the last moment The Components of Closing The "closing" is the point in the business sale transaction where all necessary documents are signed, money is exchanged for the mutually agreed upon value of the business, and the buyer becomes the new owner of the business. Apportionment of Cash on Hand, Receivables, Payables, and Work in Process. These items are often the point of conflict between Buyer and Seller at closing because their benefits are usually at odds against each other. Loan Funding, Real Estate Transfers, and Landlord Approvals. These three items are usually the cause of delays and often termination of closings. It is important to work with your broker to identify issues in these areas before closing. Tags: Closing on your business, business closing, Selling a Business, Business Brokers, Buying a Business, Transworld Business Advisors ​

As previous business owners often say… “timing is everything”. Keep the Sale Confidential Telling employees that you’re selling is an extremely delicate process. Break the news too early and you run many risks of losing your most valuable customers, vendors, and employees prior to the sale. Maintaining Confidentiality is Always Best. Hiding the sale from everyone possible is almost always the best option because it keeps the flow of information under your control Sharing the details with some employees may not be avoidable. Depending on your organization, it may be necessary to inform some of your key employees such as your accountant or a senior-level manager who is very close to daily operations of the business that you plan to sell. It’s also a good idea to introduce them to your Broker. What to do if word of the sale gets out: A breach of confidentiality has killed many deals. If an Employee, Customer, or Vendor comes to you with questions about an impending sale, ask them how they heard this information. Then assure them you are merely assessing your options and address the information leak immediately. Telling employees after the closing is usually best, but not always. Talk to the Buyer and discuss the timing with them. Always call a private meeting with them and prepare them, prior to introducing them to the new owner. Tags: Closing on your business, business closing, Selling a Business, Business Brokers, Buying a Business, Transworld Business Advisors

Preserving the business momentum and growth are the key considerations. Consider Addressing the Sale in Advance with Key Customers and Vendors. During your ownership of the business maintaining good your communications with your clients and vendors was undoubtedly one of the reasons for your success. Now that you're selling the business, good communication with your clients and vendors will affect their decisions towards the new owner. Just Prior to or Quickly After the Sale It's important to inform your key clients. Otherwise, they could learn about the transition from media outlets, competitors or other sources and there's no guarantee that the information your clients receive from these sources will be accurate. Be Clear and to the Point Professional and clear communication is the key to successfully guiding your customers through the business-ownership transition process. Carefully inform clients, starting with the most valuable, about the sale and building their confidence in the new owner and the transition process. Be specific and prepare your remarks in advance. Consider planning your communications in concert with the new owners’ announcements. Make sure the information your share with Clients is consistent with what the new owner is saying. Stay Positive and Reassuring: Communicate the business sale to customers it's important for you to remain enthusiastic, positive and confident in the new owner's abilities. Introduce the owner in a short statement that conveys your confidence in his/her expertise and plans for the company. If necessary or helpful, explain why you're choosing to sell your business, what your plans will be after the transition. Most Important To build vendors and customers' continued confidence in the business and instill their confidence in the new owner. Be aware that you're initial communications with Customers and Vendors regarding the sale will affect their decision to stay with the company or not. Tags: Closing on your business, business closing, Selling a Business, Business Brokers, Buying a Business, Transworld Business Advisors Short Bio: Bill Kelly is a Senior Business Broker and Franchise Consultant for Transworld Business Advisors of Richmond, VA. He is also a Licensed Virginia Commercial Real Estate Agent. Bill has been a lifelong Entrepreneur and has personally started or purchased and then sold eleven businesses. He lives in Richmond, Virginia, with his wife Rebecca, and has two daughters, and one granddaughter. Contact links: bkelly@tworld.com Social Media: Facebook: https://www.facebook.com/BillKelly1955 LinkedIn: https://www.linkedin.com/in/billkellyprofile/ Website: https://www.tworld.com/agent/billkelly/ LISTEN LIVE: IBGR.Network

Episode 25 Training the New Owner and Providing On-going Support Review of Sellers Post-closing obligations Transition of Management. Post-closing Sellers usually have several days, weeks or even months of training and assistance obligations to the new Owner. Ask your Broker to facilitate a meeting prior to closing to make a transition plan with the new owner. Changing Asset Ownership. Helping a new owner get control of the intangible assets can be difficult. Items such as, websites, social media sites, software, PC passwords, patents, copyrights, and trademarks will take time and effort post-closing. Transitioning Customers. Assisting the new owner with contacting key customers is central to the successful hand-off of your business. Planning with the new owner and delivering the right message to your customers is essential. Transitioning Vendors. Assisting the new owner establish a business relationship with your vendors and suppliers can be time consuming but is always to your mutual benefit. There will usually be applications and procedures the new owner will need your advice on. Checking in and Consulting Post-closing you should periodically check in with the new owner and offer your assistance if needed. A long-term relationship with the new business owner can lead to other opportunities and build your reputation in the industry. Tags: Selling a Business, Business Brokers, Post-closing, Consulting, Document Management, New-Owner, Transworld Business Advisors

EPISODE 26 Review of the Transworld Business Sales Process Each step of the process leads to a successful transaction Pre-Marketing Collecting Information, Packaging Business Offering, Sharing the Opportunity with Strategic and Pre-Qualified Buyers Marketing the Business Listing on web sites, direct mail, and conducting telemarketing. Due Diligence/Lending Preparation Preparing business documents for inspection. Recommending Professionals Facilitate Offers Processing inquiries obtaining NDAs Qualifying Buyers Reviewing Buyer Profiles Facilitate Due Diligence Coordinate information flow between Buyer and Seller Landlord/Financing Approvals Manage flow of information for lease and lender approvals. Closing Documents Sharing documents and assisting closing attorney to facilitate closing. Post-Closing Transition Facilitate planning meeting between Seller and Buyer to plan for transition activities. Tags: Closing on your business, Business closing, Selling a Business, Business Brokers, Buying a Business, Business sales process, Transworld Business Advisors

Episode 27 Review of Business Sale Documentation Requirements Ninety percent of the documents required for lenders and closing are supplied by the Seller. Past Three to Four Years of Business Financials This will include profit and loss statements, income statements, end of year balance sheets. Past Two to Three Years of Monthly Bank Statements All lenders will require this from the Seller to ensure the income and expenses of the business are accurate, and the business can pay the loan and still produce an income for the Buyer plus a profit Copy of Lease The Buyer, his attorney, and possibly the lender will want to inspect the existing lease and new lease if its being changed. Three to Four Years of Business Tax Returns All Buyers and lenders will want to examine the business tax returns. Business Contracts A copy of all business contracts with vendors, suppliers, advertisers, partners, customers, and lenders that will convey with the business. Licenses, Permits, Certifications and Memberships The Buyer, closing attorney and lender will want to inspect any of these items that are necessary to continue operation of the business. Tags: Closing on Your Business, Business Closing, Selling a Business, Business Brokers, Buying a Business, Business Documentation, Transworld Business Advisors ​

Episode 28 Review of Services offered by Transworld Business Advisors Serving the needs of Entrepreneurs, Business Sellers, and Buyers for over 40-years. Business Sales We have over 600 professional business brokers who are fully trained and have the best resources in the industry. Buying a Business Finding the right opportunity for your first business or purchasing for the growth of your existing business can be difficult. We have thousands of businesses for sale nationally and internationally. Mergers and Acquisitions When your business is looking to expand through acquisition of investment we can help. Acquisitions over $20,000,000 are handled by out M&A professionals in our corporate office. Franchise Purchase Consulting Transworld’s local office has several experts on franchise evaluation and purchasing. As previous and current franchise owners we can guide you through the process of finding and evaluating the right franchise for you. Franchise Development Transworld has the resources and experience to assist you in evaluating if your business is ready to franchise. We can guide you through the documentation and filing process to becoming a franchisor, then assist you in marketing your opportunity to potential franchisees all over the world. . Tags: Selling your Business, franchising your Business, Buying a Business, Buying a Franchise, Business Brokers, Transworld Business Advisors Short Bio: Bill Kelly is a Senior Business Broker and Franchise Consultant for Transworld Business Advisors of Richmond, VA. He is also a Licensed Virginia Commercial Real Estate Agent. Bill has been a lifelong Entrepreneur and has personally started or purchased and then sold eleven businesses. He lives in Richmond, Virginia, with his wife Rebecca, and has two daughters, and one granddaughter. Contact links: bkelly@tworld.com Social Media: Facebook: https://www.facebook.com/BillKelly1955 LinkedIn: https://www.linkedin.com/in/billkellyprofile/ Website: https://www.tworld.com/agent/billkelly/

Episode 29 Small Business in America The most successful economic system in the history of the world. Capitalism. There is no question that capitalism has been the most successful economic system the world has ever seen. It has helped lift billions of people out of poverty, and it has helped enhance the wealth, health, and education of people around the world. Capitalism enables competition, innovation, and choice. Small Business. Small business constitutes a major force in the U.S. economy. There are more than twenty-seven million small businesses in this country, and they generate about 43% of our gross domestic product. Small businesses create over 66% new jobs each year. Reasons for Starting a Business of Your Own. Changing your economic circumstances is number one. Charting your own destiny, owning your time, following your passion, and being unemployed or unemployable are among the top reasons given. Greatest Benefit of Owning a Small Business. The ability to grow financially and take advantage of tax benefits afforded to small business owners. As a small business begins to grow, you can also incorporate. This provides owner's with protection of their personal assets from legal entanglements brought on by their business. Bootstrapping refers to the process of starting a company with little or no money. But also includes companies with some capital gained from personal savings, funds borrowed or invested from family or friends, as well as income from initial sales. The name suggests, entrepreneurs must “pull themselves up by their bootstraps'' by using their own labor and capital to launch. Experts say that a majority of all startups (75% to 85%) are bootstrapped. Tags: Bootstrapping, Business startup, Business Brokers, Small Business, Consulting, Transworld Business Advisors

EPISODE 30 How Can I Start a Business with Very Little Money? Choosing the right business for you may be key to your success. Every Business Needs Money to Operate Finding start-up capital is hard but not impossible. Cash flow from initial sales and personal savings are the most common sources. But there are also Angel Investors all around you. Keep Your Job Many people entrepreneurs keep their current job and work their business as a side hustle until they can go full time. Use the Cash Flow of your Business This simple method of raising capital can work well if you have a flexible job or if you choose a job that can accommodate your work hours. Live Like Know Others So You Can Live Like No Others This saying made famous by many “Debt Free Living” coaches, can apply easily to the bootstrappers early years. Before you Borrow Money, Try a 30-Day Blitz. I love the 30-day blitz’s. Anyone can do almost anything for 30-days, so make a sales plan that’s hard and stick to it! When You Do Borrow, Make it Official and Short. The quickest way to lose family or friends is to barrow money from them and not pay it back. Always give them a written IOU with a payment plan, even if it small, make a payment every month. Tags: Finding Capital, Bootstrapping, Business Start Up, Business Advise, Starting a Business, Transworld Business Advisors