8 Strategies for Successful M&A Negotiations

Buyers and sellers tend to see their interests as opposing. But both share one critical goal: closing the deal. Skillful negotiations can help both sides feel like they’ve gotten a good deal. This process demands time and talent. A few simple tactics can help any buyer or seller achieve success at the negotiation table. Price …

Sharing is tricky, but silence can be trouble

We’re working on getting a manufacturing business sold here in the upper Midwest. The owner has been part of the company for over 35 years and is looking to enjoy life a bit more. He plans to stay and help the new owners, but he wants to be on the shop floor, troubleshooting projects, quoting …

Telling Employees About a Sale

It’s always a challenge, deciding when to tell your employees the business is being sold. Some sellers share their plans right away while others wait until the deal is signed and complete. We believe the best solution is usually somewhere in the middle. We’ve had good success when sellers involve a few key managers early …

Sell to the kids, without discord and risk?

We’re working with one of our buy-side clients and have identified a company they’re interested in. We’ve talked to the owner and he’s considering, but he’s just not sure. The sticking point? He has two sons and he might want to pass the business on to them. I’ve been in this industry for two decades …

I Want What They Got

Sometimes sellers hear that a business in their industry got a certain multiple, so they want the same number. But multiples depend on several factors, especially the size of the business being sold. For Main Street deals, multiple are typically based on SDE without working capital (approximately 2.5-3.5x SDE in 2016). In the lower middle …

What You Need to Know About a Letter of Intent (LOI)

In mergers and acquisitions, a letter of intent often signals the transition from casual discussions to serious deal negotiations. A letter of intent (LOI) by no means that the deal is finished. But it does lend a tone of seriousness to the deal, and can help both parties negotiate in a more constructive fashion. Before …

Five things that can affect the value of your business

Five things that can affect the value of your business By Brad Kirkpatrick There are five dismal Ds that can affect your business: – death – divorce – disability – disagreement – departure But a regularly updated estimate of value (EOV) can limit conflict when the D’s hit. A current EOV protects against value disputes …

Most sellers make this big mistake

When it came time to sell their business, less than half (43%) of all business owners planned ahead. That’s according to the results of the latest M&A Market Pulse survey, sponsored by IBBA and M&A Source and conducted by the Graziado School of Business at Pepperdine University. What that means is that most business owners …

The importance of family time in the value of your business

With the summer months coming up, Cornerstone Business Services’ Scott Bushkie wrote a timely article for the Green Bay Press-Gazette highlighting the importance of time away and how that enhances the value of your business. Whether it’s a family trip to a cabin or a long weekend for a child’s soccer tournament – that time …

Ask the right questions about future performance when buying a business

Warren Buffet once said, “If past history was all there was to the game, the richest people would be librarians.” When it comes to buying a business, past performance is important. But you can’t get so tied up in historicals that you forget to ask the right questions about future performance: – Management team –What’s …