Many business sales are delayed unnecessarily or even fall over because of relatively minor problems occurring at the wrong time.
So as to ensure that you have removed all possible barriers to being able to successfully complete the sale of your business, please find below a check-list that I hope you will find useful:
1. Title deeds (Freehold) - If your business is a freehold subject to a mortgage then your Mortgagee will be holding the title deeds.
Do you know your Mortgagee’s details and your mortgage account number:
If your freehold is not subject to a mortgage, do you know the location of your title deeds.
2. Title deeds (Leasehold) - If your business is a leasehold then what is the location of your lease. Is it with your solicitors or your bank?
Do you know your Landlord’s details or their agent’s details?
3. Fixtures & Fittings
We suggest you make an Inventory/list of fixtures and fittings and/or plant & equipment included in the sale.
4. Apportionment of price
We recommend that you discuss with your Accountant the apportionment between goodwill, fixtures and fittings and property.
5. Stock
Check your approximate stock level carried.
6. Employees
You will be required to provide the purchaser with the full details of your employees.
We recommend that you put together a file containing their names, addresses, dates of birth, hours worked, rates of pay and lengths of service. You will also need to provide the purchaser with copies of employment contracts, disciplinary details, holiday entitlements, bonus details, pensions and life cover details. Again we recommend that you start putting together that information in a file if you have not already done so.
7. Third Party Contracts
You will be required to provide the purchaser with details of any service/supply contracts for the business, e.g. regular suppliers, maintenance contracts for alarms, lottery and Paypoint details, advertising contracts etc
Also, you will need to provide the purchaser with details of any other commitments that you have paid in advance and that you will want the buyer to repay on completion.
8. Permits & Licences
You will need to provide copies of any Licences, Permits or Authorisations that allow you to trade; e.g. premises licence, Ofsted, Post Office etc.
Have you procured a Commercial EPC (Energy Performance Certificate) for your business premises? If not, then we can provide a quote.
9. Planning Permission
Please check your Planning Approval(s). Do you have planning consent for your use of the building?
If you have at any time increased the size of your building or business, did you get the necessary planning consent for that increase? If you did not get consent then this will almost certainly delay completion and possibly cause the sale to fall apart, consequently we recommend that you ensure that you have all necessary consents.
Do you have Building Regulations consents for any works you have carried out? Do you have plans/details of such works?
10. Business name
Are you happy to let the purchaser use it?
Do you intend to keep working or setting up in the same business in the same area after the sale?
Obviously if you wish to keep working in the same area or if you wish to retain the business name then this is likely to affect a sale and the goodwill value.
11. Website
If your business has a website, usually a purchaser will be buying this as well.
Do you know who is hosting your website?
Do you know who owns the domain name(s)?
Are you under any contracts regarding the hosting or management of your website?
We recommend that you check to ensure that you can and know how to transfer the website to the purchaser. We strongly recommend that you do not wait until completion to do this as the process can take some considerable time.
http://www.amberglobelegal.com/
http://www.amberglobe.co.uk/
Friday 10 December 2010
Thursday 2 September 2010
August Market Report
If people ask me how is the market I would call it “brittle”, it’s growing steadily and there are significantly more deals being done by us than 12 months ago but all that being said you get the feeling that one hard knock could send things back to where they were. Probably like you, I pore over the papers looking for encouraging signs of economic recovery, but the problem is that you read all these contradictory reports. My pet theory is that there are so many hedge funds out there betting on falls in the market who are putting out bad news as a way to fuel the unease and cause the market to fall, that the whole thing becomes a self fulfilling prophesy.
I certainly hope that George Osborne has got it right and isn’t going to take all the air out of the balloon with his Budget cuts in October!
The banks are behaving a bit better although the people on their credit committees are still in charge and are being very careful with the deals they approve. I heard a story the other day that one member of a bank’s credit committee had told a business broker that he didn’t trust his commercial managers to lend sensibly, which was a pretty startling revelation.
The latest news is that house prices have now been falling for three months in a row and there are going to be significant further falls in the housing market. Frankly I don’t see that. Have you heard of dramatically cut house prices in your area and people snapping up bargains? No, nor have I. What I have seen is over-priced houses being sold at what were always the right prices for those properties in the first place. In other words what we are seeing is the housing market performing sensibly with houses being sold for what they are worth. Interest rates are at an all time low and many highly geared owners in negative equity have been able to hold onto their houses so long as they are still employed. In fact house owners with a small mortgage and a steady income are in pretty good shape right now with their mortgage interest payments accounting for only a small percentage of their household income. Property prices are now back at the same levels they were in 2007 which means that they have already fallen some 20-30% in real terms. But, by the same token, I don't see property prices rising either and that's because banks will stay cautious with their lending and property in the UK is expensive and still unaffordable to first time buyers. In the current market houses are and will take longer to shift because buyers cannot borrow as much as they had initially hoped, so if you have a vendor who won’t lower his price and a purchaser who cannot raise his offer, you have a property that will stick on the market. The only way to break that deadlock is for vendors to accept that they are unlikely to get the price they want.
This is also true in the business sales market although there are one or two crucial differences: (1) house buyers can wait until they get what they want while business buyers need to buy because the longer they wait the more they eat into their capital/savings which reduces their buying power; and (2) business buyers are less emotional than house buyers, fundamentally they are buying an income stream so if they can’t buy one business at the right price, they will move onto the next one.
We continue to hear stories of vendors being told by agents that their properties are worth absurd prices. Frankly I am always amazed that these vendors can be taken in by such nonsense when surely every bone in their bodies must be screaming that it must be too good to be true. Business buyers are sensible people and they very seldom over-pay; there are too many checks and balances in place nowadays for that to happen, from their accountants and bank managers giving them advice through to their having looked at 5-10 other similar businesses before they see yours; and then there is the bank valuation - almost every business purchase is subject to one.
Traditionally July and August are quiet months when many buyers are away, however we noticed that activity over the last two months went in waves with periods of pandemonium followed by days of calm. I think this was a reflection of people spreading their holidays across the two months, rather than taking them in one block.
If you would like to discuss any aspect of the sale of your business with us then please do not hesitate to contact us on 0800 707 6370.
http://www.amberglobe.co.uk/
I certainly hope that George Osborne has got it right and isn’t going to take all the air out of the balloon with his Budget cuts in October!
The banks are behaving a bit better although the people on their credit committees are still in charge and are being very careful with the deals they approve. I heard a story the other day that one member of a bank’s credit committee had told a business broker that he didn’t trust his commercial managers to lend sensibly, which was a pretty startling revelation.
The latest news is that house prices have now been falling for three months in a row and there are going to be significant further falls in the housing market. Frankly I don’t see that. Have you heard of dramatically cut house prices in your area and people snapping up bargains? No, nor have I. What I have seen is over-priced houses being sold at what were always the right prices for those properties in the first place. In other words what we are seeing is the housing market performing sensibly with houses being sold for what they are worth. Interest rates are at an all time low and many highly geared owners in negative equity have been able to hold onto their houses so long as they are still employed. In fact house owners with a small mortgage and a steady income are in pretty good shape right now with their mortgage interest payments accounting for only a small percentage of their household income. Property prices are now back at the same levels they were in 2007 which means that they have already fallen some 20-30% in real terms. But, by the same token, I don't see property prices rising either and that's because banks will stay cautious with their lending and property in the UK is expensive and still unaffordable to first time buyers. In the current market houses are and will take longer to shift because buyers cannot borrow as much as they had initially hoped, so if you have a vendor who won’t lower his price and a purchaser who cannot raise his offer, you have a property that will stick on the market. The only way to break that deadlock is for vendors to accept that they are unlikely to get the price they want.
This is also true in the business sales market although there are one or two crucial differences: (1) house buyers can wait until they get what they want while business buyers need to buy because the longer they wait the more they eat into their capital/savings which reduces their buying power; and (2) business buyers are less emotional than house buyers, fundamentally they are buying an income stream so if they can’t buy one business at the right price, they will move onto the next one.
We continue to hear stories of vendors being told by agents that their properties are worth absurd prices. Frankly I am always amazed that these vendors can be taken in by such nonsense when surely every bone in their bodies must be screaming that it must be too good to be true. Business buyers are sensible people and they very seldom over-pay; there are too many checks and balances in place nowadays for that to happen, from their accountants and bank managers giving them advice through to their having looked at 5-10 other similar businesses before they see yours; and then there is the bank valuation - almost every business purchase is subject to one.
Traditionally July and August are quiet months when many buyers are away, however we noticed that activity over the last two months went in waves with periods of pandemonium followed by days of calm. I think this was a reflection of people spreading their holidays across the two months, rather than taking them in one block.
If you would like to discuss any aspect of the sale of your business with us then please do not hesitate to contact us on 0800 707 6370.
http://www.amberglobe.co.uk/
Wednesday 4 August 2010
DON’T START A BUSINESS – BUY A BUSINESS
Yesterday’s announcement that HSBC has this year loaned money to 65,000 new business start-ups struck me as a bizarre statistic.
Why would you start a business with all the inherent risks, lack of customers and no cashflow when for probably less money you can buy a business with a track record, customers, a proven business model and, most crucially of all, cashflow from day one?
I have started 5 businesses in my life and frankly, if I had my time over again I think I would rather buy a business. The thing that people forget is that the business you buy doesn’t have to stay that way, you can grow it and develop it just like a start-up. But the absolutely crucial thing is always the cashflow, a start-up will take three times as long and three times as much money as you expect to get it going and all that time you are probably not drawing a salary either. That makes it a high risk and expensive proposition. An existing business with a good history and proven accounts will pay you a return on your investment from day one and keep food on the table.
Most small businesses that we sell http://www.amberglobe.co.uk/search.aspx and which produce enough profit to pay a reasonable salary to the owner will sell for one to times the profit. After no more than two years you have got your money back and are still earning good profits. If there’s a property involved then obviously you pay more but you have the security of a freehold to back up your investment.
I would be surprised if more than 10,000 small business sales are completed in the UK each year, which stands in marked contrast to 65,000 start-ups. http://www.amberglobe.co.uk/sales.aspx
There are thousands of businesses for sale in the UK of just about every size and sector, and pretty much all of them are advertised on the internet on websites like http://www.amberglobe.co.uk/ or www.businessesforsale.com.
Why would you start a business with all the inherent risks, lack of customers and no cashflow when for probably less money you can buy a business with a track record, customers, a proven business model and, most crucially of all, cashflow from day one?
I have started 5 businesses in my life and frankly, if I had my time over again I think I would rather buy a business. The thing that people forget is that the business you buy doesn’t have to stay that way, you can grow it and develop it just like a start-up. But the absolutely crucial thing is always the cashflow, a start-up will take three times as long and three times as much money as you expect to get it going and all that time you are probably not drawing a salary either. That makes it a high risk and expensive proposition. An existing business with a good history and proven accounts will pay you a return on your investment from day one and keep food on the table.
Most small businesses that we sell http://www.amberglobe.co.uk/search.aspx and which produce enough profit to pay a reasonable salary to the owner will sell for one to times the profit. After no more than two years you have got your money back and are still earning good profits. If there’s a property involved then obviously you pay more but you have the security of a freehold to back up your investment.
I would be surprised if more than 10,000 small business sales are completed in the UK each year, which stands in marked contrast to 65,000 start-ups. http://www.amberglobe.co.uk/sales.aspx
There are thousands of businesses for sale in the UK of just about every size and sector, and pretty much all of them are advertised on the internet on websites like http://www.amberglobe.co.uk/ or www.businessesforsale.com.
Thursday 10 June 2010
We have recently started advertising your business on a new sales website www.businesssalesdirect.co.uk as well as freehold properties on a rotational basis on www.egpropertylink.com.
Many of you will have just completed your latest financial year. Can you please send us your most recent accounts as soon as possible or, if they are still with your accountants, your management accounts, VAT returns or at the very least advise us of how the last year’s trading has gone and when you can expect to have accounts available.
Pretty much every single interested party asks for the latest accounts once they have received the sales details and any delay in providing this information can mean that we will lose their interest in your business.
We have recently upgraded our website including the free Business Advice section which we hope you will find useful. Various professionals will begin “blogging” in that Section in the next few days on such topics as Employment Law, Business Sales legal issues, VAT and Tax, and Websites and E-Commerce. If you have specific questions to ask on those topics then please feel free to email any of the bloggers. I suspect that the E-Commerce and Employment Law topics will be of particular interest to many of you.
Even though your business is for sale my strong advice is that you should continue to run your business as if it weren’t, which means continuing to upgrade your website, improve your premises and grow your business. If you don’t then the worry is that your business will start to stagnate or at worse deteriorate which will have a negative impact on your sale price. Purchasers are particularly fearful of “catching a falling knife” and any downturn in trade or profit can kill a sale.
I am still of the view that the business sales market will keep improving. We are seeing continued strong buyer interest and high levels of enquiry. I think any redundancies in the Civil Service can only be good news for us all as it will tip more buyers into the market. However prices are still very keen and buyers will definitely not pay a premium.
If you would like to discuss any aspect of your business, its asking price or its marketing then please call us on 0800 707 6370.
http://www.amberglobe.co.uk/
Many of you will have just completed your latest financial year. Can you please send us your most recent accounts as soon as possible or, if they are still with your accountants, your management accounts, VAT returns or at the very least advise us of how the last year’s trading has gone and when you can expect to have accounts available.
Pretty much every single interested party asks for the latest accounts once they have received the sales details and any delay in providing this information can mean that we will lose their interest in your business.
We have recently upgraded our website including the free Business Advice section which we hope you will find useful. Various professionals will begin “blogging” in that Section in the next few days on such topics as Employment Law, Business Sales legal issues, VAT and Tax, and Websites and E-Commerce. If you have specific questions to ask on those topics then please feel free to email any of the bloggers. I suspect that the E-Commerce and Employment Law topics will be of particular interest to many of you.
Even though your business is for sale my strong advice is that you should continue to run your business as if it weren’t, which means continuing to upgrade your website, improve your premises and grow your business. If you don’t then the worry is that your business will start to stagnate or at worse deteriorate which will have a negative impact on your sale price. Purchasers are particularly fearful of “catching a falling knife” and any downturn in trade or profit can kill a sale.
I am still of the view that the business sales market will keep improving. We are seeing continued strong buyer interest and high levels of enquiry. I think any redundancies in the Civil Service can only be good news for us all as it will tip more buyers into the market. However prices are still very keen and buyers will definitely not pay a premium.
If you would like to discuss any aspect of your business, its asking price or its marketing then please call us on 0800 707 6370.
http://www.amberglobe.co.uk/
Wednesday 7 April 2010
March Update
So at last the election has been called for May 6th and I suspect that the financial markets will begin to accelerate in anticipation of the new government making concrete announcements on exactly what they intend to do to reduce the deficit once they are elected. And really, I think that is all the certainty we need in order to get on with our lives and continue rebuilding our businesses after the last two years of doom and gloom, much of which has been penned by the political parties to suit their own ends.
Last month we achieved our highest priced business sale for over two years and we are continuing to see improvements in sales values and buyer confidence. Rather surprisingly we are also seeing the appearance of some very confident vendors who have decided that prices are going to rise in the near term and are knocking back offers we have procured at their asking prices. To be perfectly honest I do not see any significant asset price increase happening any time soon. Buyers will continue to be wary and will be very cautious about being sold a lemon and over-paying. (If you were buying a business, how would you be feeling at the moment?).
We are just finalising some updates to our website in order to keep it looking fresh. We are also about to start running a Business Advice Centre through the website where you will be able to see answers to questions from our experts on everything from employment issues through to the cost and benefit of a search engine optimisation programme. I hope that you will find these Q&A’s useful to you in the running of your business. You will also be able to email our experts direct if you want further answers to particular questions. If you have any comments on the Business Advice Section then I would be delighted to hear from you.
You may wonder where we advertise your business for sale and so here is a list of the main advertising sites where we advertise (some sites are sector or size specific, so you may not appear on those):
http://www.amberglobe.co.uk/ http://www.businessesforsale.com/ http://www.daltonsbusiness.com/ http://www.bizsale.co.uk/ http://www.rightmove.co.uk/ http://www.rightbiz.co.uk/ http://www.startinbusiness.co.uk/ http://www.businesssalereport.co.uk/ http://www.businesstobuy.co.uk/ http://www.hotelstobuy.co.uk/ http://www.businessalesdirect.co.uk/ http://www.bedandbreakfasts.co.uk/ http://www.businesswings.co.uk/ http://www.fish4.co.uk/ http://www.ft.com/ http://www.thisismoney.co.uk/ http://www.reed.co.uk/ http://www.bizval.com/ http://www.startups.co.uk/ http://www.mybusiness.co.uk/ http://www.swbusinesstobuy.co.uk/
According to the organisations that run these different websites, your business is being exposed to a total audience of around 3million people.
If you are getting close to a sale of your business do please remember that you will need to ensure that your EPC is available for the purchaser together with any environmental reports that you may need to produce. These will hold up a speedy sale if you don’t have them. Please contact us if you would like to order an EPC at a competitive price.
http://www.amberglobe.co.uk/
Last month we achieved our highest priced business sale for over two years and we are continuing to see improvements in sales values and buyer confidence. Rather surprisingly we are also seeing the appearance of some very confident vendors who have decided that prices are going to rise in the near term and are knocking back offers we have procured at their asking prices. To be perfectly honest I do not see any significant asset price increase happening any time soon. Buyers will continue to be wary and will be very cautious about being sold a lemon and over-paying. (If you were buying a business, how would you be feeling at the moment?).
We are just finalising some updates to our website in order to keep it looking fresh. We are also about to start running a Business Advice Centre through the website where you will be able to see answers to questions from our experts on everything from employment issues through to the cost and benefit of a search engine optimisation programme. I hope that you will find these Q&A’s useful to you in the running of your business. You will also be able to email our experts direct if you want further answers to particular questions. If you have any comments on the Business Advice Section then I would be delighted to hear from you.
You may wonder where we advertise your business for sale and so here is a list of the main advertising sites where we advertise (some sites are sector or size specific, so you may not appear on those):
http://www.amberglobe.co.uk/ http://www.businessesforsale.com/ http://www.daltonsbusiness.com/ http://www.bizsale.co.uk/ http://www.rightmove.co.uk/ http://www.rightbiz.co.uk/ http://www.startinbusiness.co.uk/ http://www.businesssalereport.co.uk/ http://www.businesstobuy.co.uk/ http://www.hotelstobuy.co.uk/ http://www.businessalesdirect.co.uk/ http://www.bedandbreakfasts.co.uk/ http://www.businesswings.co.uk/ http://www.fish4.co.uk/ http://www.ft.com/ http://www.thisismoney.co.uk/ http://www.reed.co.uk/ http://www.bizval.com/ http://www.startups.co.uk/ http://www.mybusiness.co.uk/ http://www.swbusinesstobuy.co.uk/
According to the organisations that run these different websites, your business is being exposed to a total audience of around 3million people.
If you are getting close to a sale of your business do please remember that you will need to ensure that your EPC is available for the purchaser together with any environmental reports that you may need to produce. These will hold up a speedy sale if you don’t have them. Please contact us if you would like to order an EPC at a competitive price.
http://www.amberglobe.co.uk/
Thursday 1 April 2010
First Post
Welcome to Amberglobe's Blog.This is our first post but I'm sure there will be many more. Keeping watching this space.
http://www.amberglobe.co.uk/
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