Posts

Showing posts with the label valuation

Impact of the new tax law on business sales

Impact of the New Tax Law When Selling Your Business February 8, 2018  by  Michael Shea PA Starting in 2018, the New Tax Law will have a enormous impact on middle market businesses. This is true whether you are at the point in life where it’s time to sell or if you want to grow your business by acquiring other companies. Sell-Side Let’s talk first about those who want to sell their company. If this is you and you want to stop reading, all you need to know is that selling now will cost you substantially less in income taxes. You get to take more home after tax. Deductions (depreciation) that have sheltered income for you in the past at 35% to 39.5% tax rates will now be taxable (recaptured) at rates as low as 21% to 29%. Most transactions are structured as a sale of assets which places the seller and buyer in the frustrating process of making an allocation of purchase price among the depreciable assets, working capital and intangible assets such as goodwill. This ...

Profitable Businesses for Entrepreneurs to Buy in Florida

Image
Profitable Industries for Small Business December 18, 2017  by  Michael Shea PA Any good endeavor starts with a good idea – and the same is true for small businesses. While profit isn’t the only factor for a small business owner to consider, it’s an important place to start. Other factors to consider include whether the business matches your interests and skills, and what sort of barriers to entry are required such as licensing or training. If this sounds like a lot to navigate, do not fret –  Transworld  is here to help. We can help you go through an idea validation process – including market research and financial feasibility – before you’re too far in.  Transworld  can help you to do your research to make sure the concept will succeed. Owning a profitable small business is a great way to build wealth and take charge of your own destiny. The professionals at Transworld can help you get there. A recent study from Sageworks identified some of th...

Die on Your Sword - Commit to Your Business

Image
Orlando Business Broker Main navigation ABOUT   SERVICES   ASSISTANCE   BUSINESS SEARCH   BLOG   CONTACT   321-287-0349 Die on Your Sword September 25, 2017  by  Michael Shea PA Recently I picked up on Gary Vanyerchuck and his videos. He is direct, blunt and says things we all think in a vernacular that may offend some but to coin a Gary V phrase “how gives a shit”. Vee’s genius is layered in common man speak and an in your face approach to life that says own your life and your mistakes and go after what you want. His epiphany that you hit the lottery when you were born and that life is short rings true with so many of us entrepreneurs that I think all of you should take five minutes to view his facebook page or his youtube channel. I find many of todays entrepreneurs are hesitant to make decisions and looking for the “perfect” right answer.  So much so that they often times do not make decisions and get r...

Tour Operator For Sale

Image
0 Yr Old Tour Operator 2301-79448 ← Back Request More Information Send Via Email Description 20 Year old Tour operator specializing in graduation celebrations and school trips. Parks, Beaches, Cruises, Adventure tripsare a specialty of this all inclusive tour management company. Great E2 and L1 business and add on for existing tour operator. Home based, steady cash flows and consistent performance. Ideal opportunity for tourism and related industries to improve margins with low overhead high profit model. Contact Agent and Fax NDA. Listing Details Price:  $700,000 USD Down Payment:  $650,000 USD Gross Revenue:  $295,489 USD Sellers Discretionary Earnings: $242,983 USD Category:  Travel, Tour Operator Location:  Osceola, Florida Employees:  7 Years Owned:  20 FF&E:  $1,000 USD Reason for Selling:  Retirement Transworld Business Advisors is the world leader in the marketi...
Image
Popular Food Truck Business 2301-84663 ← Back Request More Information Send Via Email Description Successful Food Truck Business that attends special events and evening events. Business comes with all recipes. Established six years generating a large following on social media where customers get updates on the trucks location. Easy to run and will qualify for E2 visa. Seller will finance. Listing Details Price:  $99,000 USD Down Payment:  $89,000 USD Gross Revenue:  $149,081 USD Sellers Discretionary Earnings: $48,198 USD Category:  Restaurants, Concession Stand, Fast Casual, Take Out Only Location:  Orange, Florida Employees:  5 Years Owned:  6 Inventory:  $500 USD FF&E:  $50,000 USD Reason for Selling:  Discuss with Seller https://www.tworld.com/orlando/listings/food-truck-business-for-sale-orange-county/

Is it A Buyer or Seller Market for Selling Your Business?

Image
Is it a Buyer or Seller Market for Selling Your Business? June 16, 2017  by  Michael Shea PA Is it a Buyer or Seller Market in Selling Your Business?  Not a simple question and reflects some specifics to your particular deal but there are some macro stats you should consider if you are considering selling your business At present the sales price to asking price gap is tight. This reflects low inventory and high demand making it, in essence, a seller’s market. So, if you were looking to sell an environment like this is ideal.  The following image accurately reflects the trends we have seen for the several quarters. The next data point is multiple of Cash Flow. Again the tight inventory has driven multiples up once more reflecting a seller’s market dynamic.  The term multiple is bandied about and sometimes confuses parties but in general buyers pay a multiple of the cash flow or profits of a business.  When it is observed that multiple...

Negotiation in a Business Sale and Beautiful Mind

Image
Negotiation in a Business Sale and a “Beautiful Mind” March 10, 2017  by  Michael Shea PA All too often in business sales when negotiating a deal a seller or buyer and or their representatives look to defeat the opponent and “win”. Statistically speaking when reviewing outcomes of deals the reality is that when this approach is taken one simply does not win in the long term. Several years ago, there was a wonderful film called “A Beautiful Mind” starring Russell Crowe. The film chronicled the life of American Mathematician John Nash. Nash suffered from severe paranoid schizophrenia but pioneered the game-changing thought in “game theory” and differential geometry. If the sale of a business is anything it is a game. I would challenge all of us as principals and as consultants and intermediaries to rethink our theory regarding negotiation.  The following video largely demonstrates both the traditional mental model regarding negotiation and Nash’s innovative appro...
Image
Selling A Business In Florida February 3, 2017  by  Michael Shea PA Google selling a business and the number of articles and ads that pop up are legion. But realize that selling a business in Florida is slightly different. In Florida, as a business seller you have the benefit of a large network of professional and licensed business brokers who work in concert together. Although many states have associations of brokers Florida is the only one that has an MLS system and mandates co-brokerage on deals. What most sellers assume is that co-brokering is the norm. In fact, it is not. A seller should ensure that when choosing a broker they are: 1. Members of the Business Brokers of Florida 2. Actively Co- Broker…not just say they do but the can and should be able to show you the stats right out of the MLS. 3. Have been in the business and sold more than 10 transactions in the last 12 months. This shows they are active working members and are in the trade doing deals. To lear...

Statistics for Business Sellers to Consider

More Stats for Business Sellers to Consider April 15, 2015  by  Michael Shea PA My last two posts to the blog have been on the inventory deficit we see here in Central Florida and the strange phenomenon we are encountering in the market here where inventory (businesses for sale) is at a 5 year low. If you have read my posts there is a pending transfer of wealth somewhere on the horizon. Some 10,000,000 businesses will sell or close their doors over the next 10 years and only about 30% of that number have any idea of how to sell, transfer successfully, or maximize the value of their business. This recent Article by CNBC http://www.cnbc.com/id/102523395 is an alarming wake up call to sellers. Just as alarming is that sellers are seemingly unaware that their business sale and the dynamics of the transaction fall victim to the law of supply and demand. If, as i report inventory is at an all time low, and if this pending wave of sellers (age 65 and up) are about to enter ...

Rules of Thumb are for the Birds

Image
Rules of Thumb are for the birds October 11, 2015  by  Michael Shea PA   (Edit) In the world of small business sales and mergers and acquisitions every buyer thinks every business is overpriced and every seller thinks its worth more than what you tell them. Over the years “industry experts” of which I am apparently one, bandy about “rules of thumb”. In other words….business X sells at 2 x cash flow or 70% of sales etc etc etc. I recently had a broker call me up and tell me that a business was overpriced (not her job) and that the proper valuation method was a $ value per customer. Oddly enough a month prior she had a different position entirely (#notethesarcasm). Valuation is an art and there is data to support proper pricing. But in simplest terms there is not one method that is correct; however sellers need to be particularly cognizant of market dynamics like supply and demand and inventory levels. Yes even in small business sale and mergers when inventory...