Two decades of articles, case studies and checklists on selling, buying, valuing and financing a business. Written by our brokers and by the attorneys, CPAs and lenders we work alongside.
Tom Barry of the Atlanta Business Chronicle follows the Schefflers, who tried to sell their Jasper manufacturing company themselves and stalled. They did not know what steps to take or when, when to show financials, or which enquiries were competitors fishing for information. After hiring a broker they sold the fifteen employee company to a larger competitor and believe they netted more than they would have alone.
A frequently asked questions guide to buy-sell agreements. If you have a partner, a co-shareholder or a family member in the business, the agreement that governs what happens on a death, divorce, disability or falling out is the single most important document you own.
The high cost of inaction: funding a buy-sell agreement
ConsultKAP
Having a buy-sell agreement is only half the job. If it is not funded, the surviving owners are left trying to find the money at the worst possible moment. This piece walks through what happens when the funding step is skipped.
An appraisal is a number on a page until you know what to do with it. This article covers reading the report, understanding the standard of value used, and deciding what the figure means for your next move.
SBA lending has its own valuation requirements, and a transaction can stall at underwriting if the appraisal does not meet them. What the lender needs, who is qualified to provide it, and when in the process it should be ordered.
The patterns that show up again and again when the numbers in a business are not what they appear to be, and the checks that surface them before a buyer is committed.
Do we always have to pay those capital gains taxes?
ConsultKAP
A case study on eliminating capital gains tax on real estate and goodwill. Covers eliminating tax on the goodwill allocation of a business sale, alternative 1031 exchange strategies where real estate is part of the deal, and avoiding depreciation recapture.
One of the most common buyer questions. Most people form an LLC without adequate legal and tax advice because someone told them it was the best way. There is no standard answer, and the main differences are set out here in plain language.
Nine states have no income tax and five have no sales tax, and Alaska manages both. It is not that simple. Local sales taxes, property taxes, estate taxes and fifty different sets of rules mean that picking a retirement state on headline tax rates alone is a mistake.
Restrictive covenants update: the Georgia non-compete law
ConsultKAP
Georgia changed the way courts treat restrictive covenants. What a non-compete, non-solicit and confidentiality clause can and cannot do matters enormously in a business sale, because a buyer is paying for customer relationships the seller must agree not to take back.
Seller financing can get a business sold without cutting the price. Many sellers hesitate because they want a lump sum rather than instalments. This explains how a note is created and what can be done, including selling the note, when instalments will not work for the seller.
David Markiewicz reports on Alex and Deb Volpe. Alex was returning to a demanding corporate job at Georgia-Pacific and Deb wanted to be home with their two young children. That meant selling the family business, which needed time they no longer had.
When capital gains rates are expected to rise, the instinct is to sell investment real estate now, skip the 1031 tax deferred exchange and cash out while rates are low. This looks at whether that is actually the right choice.
Credit has disappeared, buyers are scarce, and your retirement plans have not moved. There is an answer many owners overlook. Understanding how an ESOP works can put a transition inside ninety days.
How do small businesses fight back in this economy?
Cycle of Success Institute
A CEO watching colleagues file for bankruptcy was told by her banker, CPA and attorney to close her doors. More than half the companies in her industry had gone under since 2002. She was losing key customers, cash flow was tight, morale was low and raw material prices were climbing. After forty years in business she decided to fight back instead.
Businesses looking to cash out sometimes need to step in with a loan
Wall Street Journal
Arden Dale and Simona Covel on why seller financing became close to mandatory when bank credit tightened. Fewer sellers on the block means stable, profitable businesses command a premium, but buyers still have to be able to fund the purchase.
Surprise, this business is yours: an ESOP case story
Atlanta Business Chronicle
Justin Rubner reports on John Farra, sixty-eight, CEO of Norcross printing supply company Laser Supply & Service. He took his thirteen employees to dinner, told them he was retiring and that the company had been sold. Visions of layoffs filled the room. Then he told them it belonged to them.
The business due diligence process, with two checklists
Kathryne A. Pusch, ConsultKAP
Buyer due diligence is the process of verifying that a buyer is purchasing what he thinks he is purchasing. Covers timing, what happens before and after a binding agreement, why in depth diligence is not a free look period, and includes an asset sale checklist and a deeper second checklist.
Steve Marsden of Alpharetta wanted to build a family portfolio of small businesses so his sons could work together, be their own bosses and support their families long after he was gone. He heard a ConsultKAP talk titled So, You Think You Want to Buy a Business, and said yes, I do.