When buying a business you should always sign a letter of intent. So, what is a letter of intent…or LOI, for short? A letter of intent is a written offer which underscores your interest in a particular business. The benefits of having a letter of intent are explained in this video…
A letter of intent typicaly includes what is called a No Shop Clause which prevents the seller from “shopping” the business for a two week period while you, the buyer, are doing your due diligence.
So, the letter of intent provides you with the security that you can conduct your due diligence thoroughly and that the business will not be sold out from under your nose during that period of time.
A letter of intent also acts as a guideline that both the seller and the buyer use to structure the deal. Letters of intent are really great because you hand them off to your lawyers and the lawyers know exactly what the deal is. There is no guess work.
Years ago buyers and sellers didn’t have a formal process in the letter of intent process. We would send the seller off to his lawyer and we’d send the buyer off to his lawyer and when they both came back with the deal, it was completely different in terms and price than what they had all agreed on.
Therefore, the letter of intent acts like the “pre contract” of what everybody agrees on what the deal should be. Then everybody has time to take a deep breath, do their due diligence, look under the covers, figure out what the business is, and make sure that the seller can prove all his representations to you. But he can’t sell the business out from underneath you to somebody else because he has a No Shop Clause in the letter of intent.
Typically we take a five thousand dollar good faith deposit, Vested will hold that deposit for you and if, for any reason, you are uncomfortable with that particular deal you will get refunded that money.
Do you have any questions about letter of intent or how to buy a business? If you do then call Vested Business Brokers today at (877) 735-5224 to get all your questions answered by an experienced business broker.
Vested Business Brokers has a large and growing number of laundromat and dry cleaning businesses for sale in its huge and expanding database of businesses for sale. The video below shows only a small sample of the laundromat businesses Vested has to offer.
Laundromat and dry cleaning businesses are desired by many business buyers. Therefore, it is our advice that if you see one on our site that you like to take a closer look at you had better move quickly. Call one of our brokers today and let him or her know that you’re interested. You can be sure that the highly profitable laundromat or dry cleaner business you see available today may not be on the market for too long. So act fast!
If you’re interested in buying a laundromat or dry cleaner business call Vested Business Brokers today at (877) 735-5224 to speak to one of our experienced brokers.
When you’re looking to buy a business, what are the key components that are the most important factors from the buyer’s perspective? The answers are revealed in this video…
Profitability…
Profit is the number one. You want to buy a profitable, privately-held business. You want to make sure that the seller can prove his numbers to you, and that you have the sense that they have historical financial information that you can dig into with your experts to make sure that you’re buying a profitable business.
Location, Location, Location…
Second-most important aspect of the deal is the lease. Location, location, location! I remember my dad telling me years ago, “You want to create wealth in real estate, you have to buy location.” Folks, location in businesses is 99.9% of the time the most important factor because it’s where the traffic is driven.
You’ll know right away if you have a good location because the revenue and the profits of that location run hand in hand. When you get that, you want to make sure that you have a long enough lease to amortize the debt and make yourself very happy with the rate of return on your investment.
Folks, I wish you a lot of luck. Stay out there, look for it. It’s a hunting game. You have to find the right one. Take the time to find the right business. This is what you’re going to be doing for your living. You don’t want to rush into it. You don’t want to buy the wrong business. You always want to buy the right one.
Remember, always hire professionals that you can work with, that you like, that you understand, and work with them to make sure that you’re doing the right transaction.
Let us know if we can help you find the business of your dreams. We have approximately 4,000 opportunities that we currently represent. We’d love to hear from you. Give us a call today at (877) 735-5224 to speak to one of our experienced business brokers.
What advantages do business owners get when they choose Vested Business Brokers to help them sell their business?
Advantage #1
A Proven Business Sales System. Most business owners usually don’t know the steps involved in selling a business. Not to worry…we will walk you through all of the steps from start to finish.
Advantage #2
A Dedicated Vested Business Broker. With Vested Business Brokers, you will have the help of one of our professionally trained and experienced brokers who will be dedicated as your “listing expert” to help you reach the goals you set for selling your business.
Advantage #3
The Vested Business Brokers Network. Not only do you get a dedicated broker who is your expert on your listing…We also have an in-house network of more than 100 brokers, all of whom register pre-qualified business buyers each and every day…and one of those business buyers will probably buy your business!
Advantage #4
Complimentary Professional Business Valuation. We conduct a complimentary professional business valuation that we have designed, and it maximizes the value of your business for sale.
Advantage #5
Protection of Your Interests Throughout the Entire Business Sale Process. We maximize value, we maintain confidentiality, and we maintain deal flow to help you sell your business quickly.
Advantage #6
Complimentary Internet Marketing of Your Business for Sale. We post your business for sale on 30 different web sites and search engines where we know people who want to buy a business search.
Advantage #7
Complimentary Registered Business Buyer Database Cross Check. Within 24 hours of receiving your business for sale listing, we automatically cross check our growing database of 100,000+ pre-qualified registered buyers to determine if there are instant matches. There is a very strong possibility that we already have pre-qualified registered buyers in our system who would like to buy your business today!
Advantage #8
Complimentary Advertising of Your Business for Sale in Vested Magazine. We advertise your business for sale in Vested Magazine, our proprietary publication that highlights your business for sale along with informative articles for people who want to buy a business. We target circulation of our magazine toward people who are pre-qualified and actively searching to buy a business.
Advantage #9
Commissions Earned Only When Vested Introduces the Business Buyer. We are a “pay for performance” based company. We only earn a commission if we introduce a Vested Registered Buyer and that buyer closes on your business—If you sell your business on your own to a buyer which we did not introduce, we do not earn a commission!
Advantage #10
Productive Negotiations to Help You Sell Your Business. We help overcome common objections and hurdles that occur during due diligence and negotiations—you will want to have your business broker present your case to a buyer, particularly at times when it seems like things could get unpleasant. For example, if you need to make a counter offer, let your business broker handle it. You and your buyer may need to remain associated after the sale and an aggressive confrontation during the negotiation could sour the relationship.
Additional Benefits…
We will arrange meetings between you and potential Vested registered business buyers and attend those meetings,
We will coordinate due diligence inspections by a potential Vested business buyer in a manner that will be beneficial for both of you,
We will consult regarding transfers of all leases, licenses, etc. with your Vested registered business buyer and any outside advisers, and,
We will attend the closing itself to assist in making the business sale go as smoothly as possible for all parties.
We currently have more than 3,700 businesses for sale that our brokers listed individually. The business owners that we represent come from a wide range of backgrounds and we recognize that every business owner, regardless of background, is a different individual with different needs and aspirations concerning their business sale.
We train our business brokers to be good listeners and it is this skill, above all others, that enables your broker to use all of our resources to match you to the “right” business buyer.
We are proud that this is the main reason so many business owners choose Vested Business Brokers to be their business broker after an initial “no-obligation” consultation.
Call us at 1-877-735-5224 and we will arrange for one of our brokers who works in your local area to call you today. We are looking forward to working with you and helping you reach your goals for your business sale!
Business valuation is a question that comes up a lot at Vested Business Brokers. How do we determine the market value of a business when the owner wants to sell? Getting this right is critical if you want to sell your business quickly.
There’s all different rules of thought here…There’s the income value. There’s the asset value, etc. However, the way we at our firm look at any enterprise that we’re either going to acquire or help sell is: “What is the earnings potential, and how much is it earning today?”
Every business trades off “multiples” of earnings. In other words, we determine how much the business is earning, and what type of documentation does the seller have to prove to us how much it’s earning. That’s how we determine business valuation. Every industry has a multiplier that it will trade against. We have that database with all of that information.
At Vested, we leverage the information we’ve gathered since we began in 2001. Through our analysis of the data we know that sometimes in geographical areas the multiple is larger than others. In addition, if the business is an absentee run business it might trade at a larger multiple; whereas, if it’s just a cash cow or where the financial buyer will lay out the money and let your management team send them a check every month—that’s a financial buyer—or a financial buyer who wants to be a part of that management team. But, if it’s absentee run, it will always trade at a higher multiple.
Our brokers will be delighted to tell you what the multiplier is. I don’t want to get into it in our meeting today because we represent, I think, four or five hundred different categories of businesses that are for sale.
If you have a profitable business, it will trade against the multiple of the profitability of that business. Our job is to find out how profitable you are and how to tell that story to a potential buyer who is interested in buying it.
If we can help you, it would be our pleasure. Don’t hesitate; give us a call today at (877) 735-5224 to speak to me or one of our experienced brokers.
