Selling A Business To A Competitor

Maximising value when selling a business can often mean selling to a customer or competitor and with the current market conditions as they are the return of the trade buyer has made this situation even more likely. Competitors are often the ones who are prepared to pay the best price, but this raises a number of tricky issues and careful management of the sale process is critical to achieving the right result.

Research, research, research
The value of research cannot be underestimated s, with the initial research playing a major role in the sale process and final outcome. The first step when selling a business is to prepare a list of likely buyers. Potential candidates need to be identified by in-depth research of the market the business for sale is currently operating in. This includes speaking to the major players, using the contact networks of the advisors and shareholders and utilising the international networks of corporate finance specialists to determine whether the likely purchaser will come form overseas. The next step is to agree a shortlist of parties to approach.

It is important to understand the strategies of the potential buyers, in particular their M&A plans. Some of this information will already be in the public domain but pre-screening buyers is an important step. The pre-screening process will involve speaking to, or meeting with, potential buyers to reach an understanding of their specific plans. This may even extend to asking questions relating to the area of the business that is for sale though not disclosing who the client is at this early stage

Understanding the key selling points of the business for sale and matching these to the strategies of the potential buyers is critical. There are key questions that need to be addressed at this time. Who is the business worth most to and what are the potential synergies available to the buyer – both sales driven and cost driven? Is there a gap in the potential buyer’s strategy, in terms of their product lines, market segment or geographic coverage that could be improved by acquiring the business that is potentially for sale. Which competitors would find the client’s business attractive to buy, perhaps because it would rather own it than compete with it?

Lastly, it is important to understand the key individuals who drive the potential buyers’ business. Are they longstanding players? Perhaps they have a track record of buying and building businesses. Will they be able to gain support within their organisation to get a deal done?

What we often find is that the ultimate buyer is one of the first names on our list of potential buyers because it tends to be a competitor or a customer who ultimately sees most value in acquiring a business.

When Catalyst worked closely with a heating and plumbing equipment supplier the buyer was its major competitor.

The deal was quite a delicate one because we had to let the other side look at the details of the business but we could not reveal everything in the first instance. It had to be handled extremely sensitively.

The business was finally sold to its major competitor the outcome being a successful result for the vendors of the business who achieved an excellent price. The fit of the business with its major competitor made perfect sense but it was important to ensure that an advisor we understood the sensitivities of the deal without losing the buyer.

Tactics
In a transaction such as this you can’t rush in and declare your hand too quickly when you are selling to a competitor and the same applies when selling to a customer. The first step is to prepare a tightly worded confidentiality letter which protects the client from potential buyers using information they learn from their discussions with you. This would include preventing them from using such information to target staff and customers, for example.

it is also imperative to hold back sensitive information until the last minute. Customer information is one such area, as it is vital to head off any attempts by the acquior to approach the customers of the business that is for sale until late on in the sale process. It is also at this stage that it will be important to make sure that there is a synergy between the two businesses. It should be clear that the two cultures are going to be a good fit and that all of the key individuals will be happy in their new roles.

Selling a business to a competitor or to a customer can be highly sensitive and fraught with potential pitfalls but, with the correct guidance from experienced advisors this may be the best route to take to meet the shareholders objectives.

Why A Business Model Is So Important

A business model explains the rationale of how a company establishes, provides, and captures value. It includes the product or services offered, sources of revenue, customer base, organizational structure, strategies, operational process, and financing. Basically, the methodology and infrastructure of a business combine to form the business model. This model should be created long before a business opens its doors.

Before starting a business, an entrepreneur should be aware of the basic process for building one. This knowledge proves valuable when creating the business model. Certain aspects of infrastructure, operations, and strategic thinking have proven successful, while others are destined to fail. Being able to distinguish one from the other enables a business owner to avoid the pitfalls. A business with a model that maximizes opportunities and avoids threats is positioned for long-term success.

Sales are an important aspect of the business model and this is where proven methods really shine. By learning how to quickly generate income from sales, any business can get out of the growing pains stage much faster. The sooner a company can pass through this phase, the less likely it is to become a statistic. Quick success is especially important in the online world, where competition is particularly fierce. When a company becomes financially independent, so will its owners, and this is a much more comfortable way to live.

Closing a sale successfully is what leads to income so a business model should include information regarding closing techniques. These should be based on success achieved by other businesses and should be shared with the entire staff. Every employee serves as a mouthpiece for the organization so it only makes sense that each staff member be skilled in closing a deal.

Prospects have many excuses, especially during times when money is tight. They may be fearful of making a purchase because they do not want to spend their hard-earned money. Some of them convert this fear to aggression, placing pressure on the business. Staff should be trained in handling these situations and know how to convert negatives like this to positives.

Leaders in business know what it takes to achieve and maintain a high level of sales. It is not unusual for them to have salaries into the seven figures. By incorporating what they do and how they do it, any business can realize similar results. A sound business model can result in an entrepreneur making more money than ever anticipated.

Drawbacks Of Financial Accounting

Accounting is not at all free from some accompanying limitations. In fact, financial accounting permits some alternative treatments as well. Bookkeeping is generally based on the concepts usually referred to as ‘generally accepted principles’. But there exist more than one principle for the efficient treatment of any one of the items to take place. This permits alternative treatments with in the big framework of generally accepted financial principles. Financial accounting, sometimes, does not provide one with the essential timely information. Actually, it is not at all a limitation when high powered software applications are used to maintain online and concurrent accounts, where the balance sheet will be made available in an instant.

Financial accounting systems are designed in such a way as to supply information in the form of statements called balance sheets and profit and loss accounts, generally for a period of one year. So the information received is said to be of historical interest only, and only the post-mortem analysis of the past figures can be conducted. The whole business requires information given at the right time, at frequent intervals, in order for the management team to plan and take corrective actions. As the tradition goes, financial accounting method is not supposed to bring in relevant financial information in a time interval less than one year. Now, with the advent of computerized accounting soft wares, monthly profit and loss account figures can be known and this will help overcome the existing limitations.

Some are of the opinion that financial accounting statements and reports get influenced by personal judgments. The ‘convention of objectivity’ is respected all over the world in accounting; but, to maintain records of certain events excellent estimates have to be made, which requires informed and intelligent personal judgment. One cannot expect accuracy when it comes to future estimates; and, as a result, objectivity suffers. Financial accounting sometimes ignores some of the very important non-monetary information. But, the interesting fact is that financial accounting does not consider these transactions as something that is non- monetary in nature. As for reference, the intensity and extent of competition faced by the company in business, the latest technical innovations possessed by the organization, the loyalty and efficiency factor of the employees, etc. are some of the important matters the management of the business would get highly interested.

However, accounting is not tailor-made to take note of these kinds of matters. Thus any end user of financial information will, naturally, get deprived of some vital information which is non-monetary in character. Today, good accounting soft wares with MIS and CRM can prove to be of great use for bookkeepers to overcome this limitation, at least partially. Another disadvantage is that financial book-keeping does not provide a very detailed analysis. The information provided is, in reality, just the aggregate of the different financial transactions that have happened during the course of a financial year. In a way, it enables bookkeepers to study the overall results of the business trends, where the information pertains to the cost, revenue and profit of each and every product.

Become A Personal Trainer The Rich Way

Most fitness enthusiasts not only ask how to become a personal trainer, but also want to know the secrets to quickly becoming as profitable as possible.

Becoming a certified personal trainer is not that complicated. First off, there is no formal regulation in the personal training industry. Anyone who wants to can become a personal trainer. There is no need to be licensed in order to collect money for training individuals.

However, you must understand, your requirements to become a personal fitness trainer carry along with it a sense of responsibility. In order to be competitive, as well as contribute to the professionalism in the industry, you must have some formal personal trainer training, and possess a fitness trainer certification before you officially begin coaching people for money.

Once you decide to become a personal trainer you need to acquire trainer liability insurance, a CPR certification, and the proper fitness trainer certification. it is your responsibility to both your future clients, and the industry you represent.

Once you have the requirements to become a personal trainer out of the way, it is time to focus on how to maximize your fitness training profits. Below I list 5 personal training profit tips to help you quickly begin generating personal training income.

Here are 5 basic tips to follow in order to start your fitness career off in a profitable manner.

1. Understand your fitness consulting practice is a business, and must be treated as one. It is important to be professional, and understand basic sales, and marketing skills.

2. Keep an eye on your numbers at all times. As a fitness professional, it is important to know where your business is financially at all times. Set session goals each week. If your numbers are down, sharpen up your personal trainer marketing muscle. Every successful business owner sets volume goals, and knows their numbers at all times. Keep a close eye on what is happening, and where you can improve your fitness business.

3. When you become a personal trainer you must always be marketing. This is one of the most neglected skills seen in fitness coaches from all over the world. They really do not think they have to market.

You could be the greatest personal trainer in the world, but if you don’t market your services, nobody will invest in you. Why? Because they will never know about you. That is why I recommend focusing on your personal trainer marketing each, and every day. You want a steady stream of training clients ready to invest in your services. As a matter of fact, you want a waiting list ready to train with you when you begin your fitness career.

4. Leverage your time using multiple streams of income. The most successful personal fitness trainers leverage their time by creating other revenue streams. After you get your fitness business going, it is time to diversify your profit stream.

There are many ways to do this. One of the most profitable ones is to create your own fitness related information products, and market them online. Many fitness trainers are profiting nicely doing exactly this. Many follow this very simple, step by step fitness business information product blueprint. This personal trainer course takes a fitness pro by the hand, and reveals, step by step, the secrets to easily creating a residual information profit center on the internet.

After you become a personal trainer you will soon realize your time is your greatest asset. Time is the ultimate commodity. Your goal is to be able to generate fitness income, residually, at the same time as training your clients.

5. Invest in continuing education. A top-notch successful personal trainer needs to consistently invest in themselves by studying the latest in fitness sales, and marketing.

That is right! It is not just exercise physiology you need to keep up-to-date with, but sales, and marketing too! The fitness sales, and marketing knowledge will assist you in reaching more clients you can assist.

How to become a personal trainer is one thing, but how to quickly become a profitable fitness professional is another. To get yourself off on the right foot follow the 5 fitness business tips above. That way your fitness career will get off to a profitable start.