Minnesota Business Brokers

Sell a Business

Selling your business will involve many emotional issues, in addition to the financials that will determine the value of your business.  Keep in mind that as with any investment, ultimately what the buyer will pay is the true determining factor in what the real value turns out to be.  It is “all in the eyes of the beholder” and it is up to the Seller and the Business Broker to help create as much value as possible, for the buyer to see and appreciate. 

An effective working relationship is required between the Seller and Broker to build as much factual and documental value as possible.  Often, outside professionals are included, such as lawyers, accountants and advisors as well.  Sellers will want to be sure their Business Broker will work well with such professionals.  The Business Broker gets involved in the middle of all of this and is the catalyst to ensure that the Seller and Buyer meet, reach agreement and then close on the transaction. 

Buyers are usually looking to buy the documented cash flow of the business, so the Business Broker will “recast” your financial statements to reflect the actual cash flow and then arrive at an estimated sale value.  Cash flow that cannot be readily documented is sometimes referred to as “blue sky”.  Blue sky is often readily discounted by Buyers, especially in today’s market.  In some rare cases, such value may exist, but only an experienced Broker can create the proper asset framework, from which the Buyer may appreciate and then may be willing to pay for it.  Remember, however, that once again it will be up to the Buyer if they are willing to actual pay for such value.  The Business Broker takes all of this into account when advising a Seller on the price.

Sellers have often invested many hours, effort and money building, running and operating their business.  Often when they started their business it was the result of a life long dream that when it comes time to think about selling that dream, emotions run high.  Business owners often decide to sell their business for a number of personal reasons such as; “burn out”, change in family make-up, lack of success, retirement, management or partnership difficulties.  Sometimes a business owner will sell one business only to buy another.

Lastly, Sellers will need to be prepared to offer financing to the new Buyer.  In today’s market, seller financing often will mean the difference between a sale closing or not.  The days of selling for cash have mostly long passed, and even when cash was offered, Buyers exacted deep discounts from the Seller.  However, Sellers can expect to ask for significant down payments in an effort to be sure the Buyer has a significant stake in the purchase, large enough to hurt if the Buyer were to default.

Sale, Merger, or Partnership with an Existing Business

Midwest Business Associates, LLC currently has potential buyers, investors, and other businesses interested in acquiring, investing or merging with complimentary companies.  Please go to Mergers & Acquisitions under the About Us tab for a list of current opportunities.

If you are interested in further exploring an opportunity for your business (company),  contact MBA to see if there is a potential match. We will explain a confidential limited engagement process to facilitate the outcome most beneficial to you.