Aron

About Aron Brajtman

This author has not yet filled in any details.
So far Aron Brajtman has created 39 entries.

What Buyers Like and Will Pay More For

 When buying a business, buyers and their representatives (agents,lawyers) create a short list of  a specific set of criteria. Among them are:

More Cash and Less Inventory
Positive Long-term Contracts
Diversified Base of Customers and Suppliers
Solid Capture and Retention of Order Data
An Audit for the Prior Five Years
A Strong Management Team

Not all may apply to your business but probably most do.
More Cash and Less Inventory
Buyers like to see a strong cash position. This comes from smart management of working capital. The seller can increase their cash position by:

Collecting  accounts receivables faster
Clearing inventory that is not moving
Obtaining the most favourable terms for payment from  suppliers

Positive Long-Term Contracts
Long term contracts reduce volatility and uncertainty.Buyers will focus on confirming the sustainability of production. Long-term contracts examples are

long-term supply contracts
leases on valuable land and buildings
leases on production facilities and distribution.

Diversified Base of Customers and Suppliers
The seller should not be dependent on major customers for a large portion of their sales because customers can put pressure and threaten to withdraw their business.

The opportunity to supply a major retailer (i.e. Wal-Mart […]

If Prepared the Sales Price Will Be Higher

Winners and Losers
There may be a large difference in the price obtained between the Losers (owners who continue to manage their business as before), and Winners,(those that consciously prepare it for sale).

 

How To Prepare the Business for Sale
Preparing a business for sale has four components:

Timing the sale during high growth or early maturity period
Managing for cash
Managing for growth
Managing so as to earn a higher multiple of earnings

Timing the sale during high growth or early maturity period
Every business will go through four stages of a life cycle. Please see the graph below.

The smart time to sell is when the business has completed its growth stage and is beginning to mature. At this point the business will realise its maximum value.

Too many owners try to sell at the decline stage because they haven’t recognized that their business is in decline. Sometimes the decline is due to increased competition in a mature and no longer growth industry. The competition is fierce and the margins low, hence the whole industry is in decline. Sometimes owners lose some of their passion for the business and […]

Is My Idea Going to Create Wealth?

John Mullins in “The New Business Road Test” says

“the odds against hitting the jackpot as an entrepreneur can be nearly as daunting as those in Las Vegas or Monte Carlo. One way to mitigate the long odds,…, is to make sure you’ve identified an attractive market segment, one where the customers, according to evidence you’ve gathered, are almost certain to buy what you’ll offer.”

The above statement is ignored by too many.  Time and again I meet startups where the founder is convinced that their idea is  the path to wealth and  that customers will flock to their door. It simply is not true.

The key is doing due diligence in  discovering a market segment that badly needs and wants your product.

Discovering that market is not a trivial undertaking. While you may be convinced that of course  customers are more than willing to buy your product,that’s not enough. What you want is answers to the following:

Market Size and Growth Rate

Is your market large enough to allow you to attract a specific segment that will prefer you over the competition?
What are […]

Exit Strategy Program

Exit Strategy Program

How to Obtain a High Sales Price for Your Business

A business should do more than provide the owner with a livelihood. In addition to fulfilling the owner’s passion it needs to achieve such value that the owner can sell it at exit time for a price that reflects the time and effort invested. After putting in 20, 30 or 40 years the business should be sold for enough to provide a comfortable retirement for the exiting owner. If not, then all the business did was to provide the owner with a job. Building a business should factor in an exit plan and converting into cash the value built up over the years.

At exit time because of age, lifestyle changes, and financial needs, business owners want to realize the value locked up in their business. Too often the offers they receive do not meet their expectations. This is a situation that could have been avoided.

The investment made in building a business over a generation is frequently several million dollars, and too often it cannot be sold quickly. So, to arrange for a quick sale, and to obtain a fair price much preparation should have […]

Why There’s a Need for an Exit Strategy

Eventually all business owners will need to exit their business.

Reasons may vary but they revolve around the following factors:

Retirement because of age
Health problems of the owner or their family
A change in circumstances impacting family finances
Unexpected family issues
Change of interests and no longer passionate about the business
An unexpected offer
Pursuit of new venture
Need to raise money
Desire to spend more time with family or take care of a loved ones
Death of owner/financial difficulties
Desire for liquidity and asset diversification on the part of the primary shareholder
Competitive pressures. Unable or unwilling to compete.

 

Having established that exiting is unavoidable, the wise business owner will create an exit strategy while still many years away from departure and will run their business with the view of securing the best possible price when that time comes.

Find out how to obtain the best possible sales price for your business.

 

By |January 18th, 2018|Exiting|0 Comments|

How We Can Be Your Competitive Advantage?

Maybe this sounds familiar?

In the past the business was fairly successful. Now it’s barely providing a living and the outlook is no better.

You are worried about surviving.

You are worried about your competitors taking away your market share and your customers.

Nothing is helping.

The cause could be any number of things such as:

The business has weaknesses that are overwhelming it
The business team needs strengthening
The environment has changed and the business has not kept pace
The competition has grown stronger

We can help with all of these and today we will address the competition.

We claim that if you don’t possess a competitive advantage , that is if customers have no specific reason to chose you then you are seen as a commodity and your prospects look for the cheapest provider.

A competitive advantage starts with thinking about customer needs and and your planned solution to those needs.

Take our firm for instance. What competitive advantage does Aron Brajtman CPA’s possess?

We do several things that other accountants don’t:

We help in creating growth in the value of the business.

We do this by focusing the busines on areas […]

Rapport as a Sales Tool

Rapport is the ability of buolding a n immediate relationship by showing your prospect that you share the same values.

For instance when I learned that my business coach was a fan of Stephen Covey and of the Blue Ocean startegy,I realized that we were very much on the same wave length both when it comes to sharng a belief in effevctiveness  and in values.

The benefit of rapport is taht it builds trust very early in a relationship an dsaves much inquiry. It makes the achieving of mutual goals musch easier.

Let’s get real: Inadequate Financial Management

Failure in business is unavoidable when the cash finally runs out. You close the doors and pack it in.

The failure was apparent for some time ,maybe years and is frequently the result of poor management skills.
Let’s get real.
Mahan Khalsa uses that term in his book of the same name. For me let’s get real refers to the capabilities a business must poses to survive. See diagram below and click to enlarge it.

I repeat. The business to survive must be strong in all these areas.

Today I want to address financial management. Below are problems that indicate inadequate financial management.

 

Learn how to deal with your challenges by downloading diagnostics of survival and see where the solutions lie.

 

Did you validate your business idea?

What follows is a step by step series of validation steps building or disproving the case for starting a business. This act of validating a business case will significantly increase the odds of success in a world where most new businesses go quickly out of business.

 
Identification of Business Opportunity or Need
No business should be started without identifying an existing concern shared by the stakeholders in the industry and without identifying this as an opportunity to provide a solution. For instance, say that the nearest pizza outlet is 50 kilometers away and they won’t deliver to our location. That’s an existing concern and the opportunity is obvious. If on the other hand the area is well serviced by enough pizza outlets, what’s another outlet going to do? It will not satisfy the market any better, Instead another vendor has been added to an already saturated market.

I used pizza as an example but the same applies to any service provider  such as a dentist, chiropractor, optician, physiotherapist, renovator, painter etc . The same applies to products such as car dealerships, appliance vendors. retailers in general. The […]