Better. Not Broker.

Broker560

 This is a sad story about the decline of a small town manufacturer. When the economy went into recession, the company contracted from $6MM to $4MM and became unprofitable.

The owner hired a broker to sell the plant. A year passed without any offers from any qualified buyers. Another broker was hired. Of course, by now, the ‘for sale’ issue was universally known throughout the town and morale plunged. Know what else plunged? Business. Being ‘for sale’ is not a great position to have when trying to land new clients. Their revenue contracted further to $3.5MM. They became more unprofitable.

That year also passed with no offers from qualified buyers.

So the owner hired a third broker. And lo and behold….

Continue reading “Better. Not Broker.”

The Grinch Thank Stole Business

iceberg picAfter years of growing a profitable business in the northern suburbs, Marvin woke up one morning and knew that it was time to get out. Now, it just might’ve had something to do with a very cold temperature and continued frozen forecast. But for whatever reason, Marvin’s brain flipped a switch and retiring and moving south were all he thought about.

Well, as luck would have it, a fellow Rotary member named Alan, expressed an interest. They sketched out an agreement then had Al’s lawyer put it in legalese. Inside of thirty days, Marvin had put his house on the market and moved to Florida.

It was everything Marvin had dreamed about: moderate temperatures, relaxed schedule, and the beginnings of a social life.

Three months into retirement all was going well. His Minnesota house had sold. Alan’s business purchase payments were coming in steadily.

Six months into retirement he couldn’t believe he hadn’t done this sooner. But Alan’s payments were starting to be late…

Continue reading “The Grinch Thank Stole Business”

Retirement = Current Business Value)/time * Options – what is retirement worth?

ensenadaAThis is a tale of two business owners – both owned companies roughly the same size, in roughly the same industry, and both at the stage where they really thought hard about getting out.

Now some of you may have been aware of a market correction from 2008-2011 and this comparison is about the effect of time on your plans to harvest your business.

Both owners saw their revenue contract but they took difference approaches.  Continue reading “Retirement = Current Business Value)/time * Options – what is retirement worth?”

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