Selling Your Business Presentation 030711

1. Selling Your Business Jeff Goldblatt Business Intermediary VR Business Brokers

Small Business Overview

Business Intermediary Defined

VR Corporate Overview

VR McKinney Overview & Core Competencies

Business Selling Cycle

12 Advantages Of The VR Sales Process

Industry Facts & Data

There are close to 25M small businesses currently operating in the US.

78% of small businesses have revenues less than $100K & 77% have no employees.

With the first wave of the baby boomer generation nearing retirement, there are more businesses for sale than ever before.

The process of selling a small business and expediting its sale is a complex and time consuming process.

Utilizing a Business Broker can maximize the value of the business and shorten the sales cycle

The reasons above accounted for 90% of the total responses

VR has 30 years of successful business sales through valued representation

VR has sold more independent businesses worldwide than any other firm.

VR has the most creative & comprehensive marketing.

VR prides itself in providing the same level of service and professionalism to each and every client no matter the size of their enterprise, and is the driving force of its profession.

Supported by the history, expertise and resources of the international VR Corporation.

Two decades of experience working with small businesses.

Specializing in selling small privately held businesses in various industries.

Extensive experience in selling independently owned franchised businesses.

Result driven, professional representation with confidentiality maintained through out the selling cycle.

Expertise at maximizing the value of the business.

Expertise at marketing the business.

Effective at attracting qualified buyers and maintaining confidentiality.

Expertise at providing counsel during negotiations.

Expertise on how to financially structure the sale.

100% committed to the sales process allowing the owners of the business to remain focused on running their business.

Marketing of VR Business Broker Services

Initial Meeting With Seller Exploratory

Industry & Location Research

History & Trend Review

Information Supply For Valuation Review

Valuation & Price Analysis

Listing Appointment

Develop Marketing Plan

Business Profile Development The Facts

Interview & Qualify Buyers

Business Tour

Evaluation of Offers

Due Diligence

Financing

Escrow & Closing

BizComps reported an average time from listing is 187 days with a median of 147 days

1. EXPOSURE- The key in selling a business is showing it to the right person.A larger number of qualified buyers results in a higher price for your business.Because of theVR Network dominancein the marketplace, we have hundreds of buyers calling us and a backlog of thousands of prospects searching for businesses.

2. ADVERTISING/MARKETING-We know how, when and where to advertise your business in order to attract the right kinds of buyers.We pay for the advertising (no cost to you), including your ad on our websitewww.vrmckinney.comand our corporate website atwww.vrbusinessbrokers.com .In addition to these two web sites, we advertise on a variety of additional sites giving overall exposure to over 125 different sites.We also advertise in newspapers, trade magazines and direct mail, as appropriate for each individual listing.

3. CONFIDENTIALITY- One thing that you can be assured of is the sale of your business will be handled confidentially.If your employees, competitors, customers or suppliers find out you are selling, your business could be damaged.We have developed a successful strategy to protect your confidentiality.We never disclose the name or location of your business on the telephone.We will not work with a buyer until they have been qualified and have signed a non-disclosure/confidentiality agreement.We never send buyers out to your business unescorted.We never put the name of your business in a multiple listing service for everyone to see.We accommodate your needs with after hours meetings if necessary.Everything we do is designed to protect your business and your confidentiality.

4. TIME- It takes a lot of time sifting through all of the inquiries and finding a good buyer.We do that for you so you can spend your time running your business.If you did find an interested buyer on your own, you would spend a tremendous amount of time showing them your records and operation.We allow you to protect your business' value by spending full time running it.

5. SYNERGISM- Advertising alone doesn't sell businesses.You need experienced business brokers to get people interested in your business. About 1% of buyers buy the business they call on and less than 30% buy even the type of business they called on.We get a good cross section of buyers and then conduct in-depth interviews to determine their qualifications.The money you would have to spend in advertising to attract just the right buyer for your business would be significant.

6. PROVEN RESULTS-VR has sold more businesses in the world than anyone.No one else can compare with VR's experienced network of professionally trained associates.Because of our experience, we have the knowledge to anticipate and solve many problems before they ever arise.

7. FOLLOW UP-We will follow up with a buyer after they have seen your business, pointing out the benefits of making an offer.We will report buyer's reactions to keep you posted on how your business compares with others on the market.Our follow-up after an offer is signed includes setting up due diligence, assisting in arranging the financing, removing contingencies, engaging legal counsel,etc., to ensure a higher probability of the transaction closing in a timely manner.

8. NEGOTIATING POWER- We pursue buyers without damaging your negotiating position.Every time you contact a buyer yourself, it weakens your negotiating power.As an intermediary, we can identify the buyer and encourage him to make a decision, without implying in that you are anxious to sell.All of our associates are experienced negotiators.Even if you are a good negotiator, it really helps to have an intermediary between you and the buyer to preserve your good relations.

9. RISK FREE- We research your business and help get it ready for sale.This includes advising you on pricing, preparing a marketing package, advertising your business, interviewing buyers, negotiating on your behalf and doing everything necessary for a smooth sale.We do all this withno feeat all unless a buyer is found at the price and terms you agree upon.

10. PRICING- Our exclusive database of businesses sold nationwide by VR offices gives us extensive statistics to assist in pricing a business.We know what buyers look for and what they are willing to pay.We make sure you don't overprice and scare off good buyers or under price and leave money on the table.We use our database and expertise to convince buyers that your asking price is fair.

11. STRUCTURING/OFFERS- We know how to structure transactions to minimize the chance of a problem.We use our experience from thousands of sales to develop terms that work.We prepare the offer using the appropriate documents and clauses.The offer, accompanied by an earnest money deposit and information about the buyer, will be explained to you.We will counsel you on your options of accepting, countering or rejecting the offer and on what has to be completed before closing can take place.We will coordinate with all parties to keep the process moving to a closing in a timely manner.

12. CLOSING- We know capable, qualified attorneys that can safely handle the details of the closing for you at a reasonable fee.We will attend the closing with you as well.

All cash transactions are rare and mainly occur with businesses that sell for $100K.

On average, a seller who accepts an all cash transaction receives 70% of the asking price.

Sellers willing to accept financing terms receive 86% of the asking price.

Close to 40% of the businesses sold are in the food & beverage category. Another 30% of the businesses sold are service related.

Small businesses are usually financed over 5 to 10 year period. Debt service should not exceed 25 to 30% of the annual cash flow.

BizComp Database Small Business Sales Data

The selling price as a multiple of gross sales is:

Average 44% Median 37%

The selling price as a multiple of Sellers Discretionary Cash Flow(SDC) is:

Average 2.42 Median 2.03

80% ofnewbusinesses fail in the first three years. Buying an established business can provide an established customer base & cash flow.

Often, the seller of a business will provide training which increases the odds for success.

The End!