We have had the opportunity to work with businesses of all sizes and across various industries, thanks to our extensive track record of completing hundreds of transactions. Whether your business is small, medium, or large, we possess the expertise and experience as successful business brokers. When you engage in a conversation with us, we are confident that you will be able to recognize the depth of our knowledge and understand our ability to assist you effectively.

Maintaining confidentiality during a business sale is a challenging task. There is a serious risk that key employees may become aware of the potential sale, potentially leading to complications. The process of selling a business demands a considerable amount of time and attention, diverting your focus away from running and managing your business effectively.

To increase the likelihood of a successful sale, a substantial pool of qualified buyers is necessary. Established brokers have spent years cultivating such a pool, which gives them a distinct advantage in the sales process.

Negotiations in business sales can be intricate, and first-time sellers often find themselves at a significant disadvantage. Experienced brokers possess the knowledge and skills to navigate these negotiations effectively.

Laws governing business sales are subject to change over time. Brokers who actively practice in this field stay updated with these requirements and have the experience to ensure compliance. Attempting to sell a business independently may not be realistic or worth the risk, given the significance of such a transaction.

Yes.

Prospective buyers are ALWAYS interested in analyzing the cash flow of your business to assess whether it justifies the asking price. They generally prefer to review the financial statements from the past three years, if available. Well-organized financial statements that consistently categorize your income and expenses are highly valued by buyers, as they instill confidence in their potential purchase. It is advisable to avoid refusing to share financials, as most buyers perceive it as a significant red flag.

Every business has its unique aspects when it comes to bookkeeping. If you are contemplating selling your business, it is recommended to consult an experienced broker who can evaluate whether your current books and records are prepared for the sales process.

3-5 Past years of:

o   Profit & Loss Statements

o   Balance Sheets

o   Tax Returns

o   Equipment List and Appraisals

o   Property/Building Appraisals, Lease, or other real estate information

o   Completed Business Valuation Adjustments Checklist

Certainly! You can engage our firm to sell your company without having to pay for a valuation upfront. In the case of most small businesses, XSG does not charge any upfront fees. We provide a complimentary value assessment that offers a range of values you can anticipate in the marketplace. This assessment is conducted prior to signing a listing contract for your business, ensuring that your expectations align with market realities. You can reach out to us by calling our office or by completing our strictly confidential Market Price Analysis Calculator. Once we receive your form, we will promptly get in touch with you to discuss the value assessment in detail.

Typically, our compensation comes from the sellers we represent. In rare cases, we may receive compensation from our buyers, but that is uncommon rather than the norm. When selling a business, we are paid upon performance – that means we only get paid if you get paid!

During the Buy-Sell Agreement process, it is essential for both parties to establish a mutual understanding regarding the basis for determining the value of the business. This ensures that neither the seller nor the partner feels that the cost is being inflated to gain excessive profits from the departing party. Such an agreement benefits both parties and prevents potential conflicts or complications in the future. Furthermore, it is crucial to include a security clause that requires the departing partner to sign confidentiality, non-compete, and/or anti-solicitation agreements. These provisions safeguard the remaining business partner from the risk of divulging trade secrets to competitors. If you plan to sell your share of the business, it is highly recommended to have a well-prepared Buy-Sell Agreement in place and seek the guidance of an experienced business broker. With these elements combined, the selling process can be expedited and conducted smoothly.

To begin, we meticulously craft comprehensive information packages that showcase the strengths and potential of each business. These packages include pertinent statistics such as summarized financials, lease terms, and more. Additionally, they provide insights into the background of the sale, accompanied by ample photos and, in many cases, a video tour or an interview with the owner.

Subsequently, we leverage our extensive database of active buyers who have expressed interest in similar businesses. We promptly notify them about the exciting new opportunity, ensuring that our rotating internal database remains populated with eager and qualified buyers.

Furthermore, we discreetly advertise on popular business-for-sale websites. Our advertisements are designed to generate interest and inquiries while safeguarding the confidentiality of the business. We remove any identifying characteristics of the business from these ads, providing sufficient details to pique curiosity while maintaining confidentiality.

Disclosing the prospective sale to any employee without a Non-Disclosure Agreement does not bind them to maintain confidentiality. There is a risk that they may share this news with competitors, key customers, or the landlord, resulting in a detrimental impact on the business.

Employees who become aware of the potential sale sometimes experience anxiety and make impulsive decisions, even though the business (along with all its employees) could potentially benefit from having a new owner.

During the sales process, circumstances may change, leading to the seller deciding not to sell the business. Employees who were aware of the potential sale may question the long-term viability of the company and its leadership, leading some to actively seek other job opportunities. The loss of key staff can severely harm operations, the livelihoods of other employees, and ultimately impact your equity in the business.

Since the economic downturn of 2008/2009, the market has experienced significant growth, leading to a faster pace of business sales. Right now is an ideal time to sell. The timeframe for selling varies depending on various factors, but we have observed that many businesses receive offers within the first 30 days and close the deal within 3 months. On average, it takes about 6 to 8 months from the beginning to the finalization of the selling process.

It's crucial to understand the different components involved in selling a business. Once your business is officially listed, we commence confidential marketing efforts and assess interested buyers who meet your approval. When a potential buyer expresses interest in purchasing your business, they typically present an "offer letter" that outlines the proposed price and relevant terms. At this stage, a tentative deal is established, pending a process known as "due diligence." During due diligence, the buyer thoroughly examines the facts, reviews financial information, and ensures that the details they based their offer on are accurate and representative. The duration of due diligence can vary, but we generally aim to keep it within 14-30 days to prevent the business from being off the market for an extended period. Once financing arrangements and legal documents are prepared and finalized, the entire process from offer to closing/funding typically takes around 60 days.

Survey results have indicated that sellers who insist on an all-cash payment typically receive an average of only 70 percent of their asking price. On the other hand, sellers who are open to accepting favorable terms for payment tend to receive an average of 86 percent of their asking price. This represents a substantial difference of 16 percent. Interestingly, businesses listed for an all-cash transaction often face challenges in finding buyers and ultimately may not sell at all. However, when sellers are willing to offer reasonable terms, the likelihood of selling significantly increases, leading to a shorter time period from listing to sale. Many sellers are unaware of the considerable interest they can generate by financing the sale of their business. In certain cases, this financing arrangement can substantially enhance the total amount received from the sale. Moreover, it sends a strong message to the buyer that the seller possesses confidence in the business's ability to generate sufficient income to sustain itself.

1) Overvaluation: Some sellers set an inflated price for their business, which can deter buyers who are well-informed and knowledgeable about market pricing.

2) Lack of seller financing: If the business does not qualify for Small Business Administration (SBA) lending, most buyers are unable or unwilling to pay the entire acquisition cost in cash. In such cases, the seller's willingness to provide financing can impact the deal's success, as studies have shown that sellers who offer financing options tend to receive higher prices.

3) Declining business revenues: A decrease in business revenues can raise concerns for potential buyers and lead to hesitation or withdrawal from the deal.

4) Unwillingness to negotiate: Sellers who are inflexible or unwilling to negotiate terms may face difficulties in closing a deal.

5) Inaccurate financial records: Inadequate or misleading financial records that fail to meet buyer's due diligence requirements can create doubts and impede the closing of a deal.

6) Seller's change of heart: Some sellers may experience cold feet or have a change of heart, leading them to withdraw from the market and disrupt the deal.

7) Influence from uninformed advisors: Sellers who rely on advice from well-meaning but inexperienced individuals, such as friends or relatives, may face challenges as these individuals may lack sufficient knowledge of the selling process. Working with a professional business broker/intermediary is highly advantageous, as they possess market expertise and can effectively find the right buyer, justifying their fee.

8) Landlord issues: In certain cases, difficulties arise when the landlord cannot come to mutually agreeable terms with the seller and/or buyer, potentially jeopardizing the deal.

9) Unavailability of financing: If financing options are not available for the buyer, it can hinder the completion of the deal.

In the majority of cases, sellers receive a lump sum payment at the closing of the sale, effectively cashing out. Occasionally, the bank may require sellers to carry no more than 10% on a "Seller's Note," but even if this condition applies, 90% of the sale proceeds are still paid at the closing. Alternatively, some sellers may choose to offer "seller financing," which means they are willing to accept payments in multiple installments over an extended period. It's important to note that offering seller financing is entirely optional and is at the discretion of the seller.