One of the unique services we provide, as Business Brokers, is an intermediary negotiating “service”.

I choose the term “service” because what we do is usually not done for our own interest, but for our clients and customers.

Most people are familiar with some of the aspects of negotiation. We have all been subjected to the exhortations to always try to establish win-win situations. If you think of those instructions you have seen or heard in the past they are usually written from the point of view of a principle beneficiary of the negotiation.

A Business Brokers role is to analyze the situation from a third party viewpoint, and suggest to both parties ways to attain the “win-win” outcome everybody wants, (Keeping our own clients interests clearly in mind!). That is why we are called “Business Intermediaries”.

We make sure all parties to a negotiation understand the issues. We have to be sensitive to the communication process and understand the facts, laws and regulations, and desires and objectives of each party to a negotiation.

We have to explain to each party what is possible, and help each party establish reasonable objectives.

And in some cases we have to understand when there is no further possibility of coming to any successful conclusion of the issues being negotiated, and gracefully tell the parties that they are too far apart to make a deal, and help terminate the expenditure of time and effort on something that is not going to work.

When things go the way we always try to have them go we end up with satisfied parties on both sides.

There is a great deal of satisfaction in being able to walk out of a closing with both the buyers and sellers satisfied with the outcome.

Following is a copy of a piece generated by the International Business Brokers Association. See their copyright notice at the bottom. It does a very good job of explaining how a buyer should prepare to deal with us. The owners and some of the Associates of New Hampshire Business Sales are members of the IBBA, we follow their Code of Conduct, and three of us hold the IBBA Certified Business Intermediary (CBI) designation.

The Process of Buying a Business

Buying a business is a process that takes time. It can sometimes take years to find the right opportunity.

Unfortunately, many buyers want to look at all available options, thinking they’ll recognize what they’re looking for when they see it. That approach is actually a waste valuable time and energy and can lead to frustration and an end to the search. Or the potential buyer may miss out on great opportunities because they weren’t found early enough or they weren’t ready to move forward with a purchase.

There are some key steps to follow in the business search process:

Start with a self assessment - Ask yourself why you want to buy a business. What types of work activities do you like and what kind of lifestyle do you want to pursue? It’s important to understand that there may be more work and longer hours for an owner in some industries. Be sure to include your family in the assessment.

Establish financial expectations - Determine how much money you need and want to earn. Make sure your expectations are in line with the types of businesses you are targeting and the return they can produce.

Put together a personal financial statement - Outline your assets and liabilities. Identify what you can use for your initial investment. The personal financial statement serves as proof of your financial wherewithal, so be prepared to share this document with a seller’s intermediary.

Update your résumé - Sellers want to be sure that their business will continue to be a success. They’re looking for someone with the experience necessary to continue their legacy and take care of the staff. Ultimately, you’re selling yourself to the current owner(s), the lender and the professionals representing them.

Outline your acquisition criteria - Define the parameters of your search. Ideally it should include your targeted industries, geographic area and transaction size. Your acquisition criteria will help you demonstrate your commitment to finding the right business for you.

Search multiple sources and enlist help - Let your professional advisors (e.g. attorney, accountant, financial planner) know you are looking for a business. Most importantly, contact business intermediaries who represent businesses within your targeted market. They will notify you of available companies that meet your criteria and qualifications.

Most business brokers or intermediaries work for the seller and are paid by the seller. That means you can enjoy the luxury of their services at no cost. The intermediary is looking out for the seller’s best interests, so you should have experienced council to represent you in any transaction.

When interested in a business, you want the business intermediary to be selling you to the seller. Prove to them that you are a qualified, motivated buyer by preparing for your search.

Your motivation, lifestyle, expectations, financial statement and résumé will help you develop your acquisition criteria. Identifying and communicating your acquisition criteria, qualifications and experience will save time and frustration and will place you far ahead of less focused buyers.

The International Business Brokers Association® is the largest international, non-profit association operating exclusively for the benefit of people and firms engaged in the various aspects of a business brokerage and mergers and acquisitions. IBBA® has 1,950 members worldwide, with corporate headquarters in Chicago, Illinois.

©2008 International Business Brokers Association® (IBBA®) all rights reserved Permission to reuse any or all of this material should be directed to the IBBA at 888- 686-4442 and is restricted to IBBA members

2007 WAS A BANNER YEAR FOR NEW HAMPSHIRE BUSINESS SALES, WITH CLOSE COMPETITION FOR ASSOCIATE OF THE YEAR

For 2007 the Associate of the year award for New Hampshire Business Sales goes to Stan Evans of Wolfeboro for the second year in a row.

Stan had his best year ever out of the 6 he has been with us, and came in with a 17% edge on runner up Ed Settino, who also had his best year since joining us 6 years ago, and who was our Associate of the year in 2004.

Stan has continued to capitalize on his extensive business background in commercial lending, sales, business development, ownership, and brokerage to achieve this status.

Stan had a wide variety of sales this past year, including convenience stores, an oil distribution company, a printing company, a wholesale garden center, a medical services company, and some commercial real estate. In addition to the sales he managed he has an impressive list of properties he is currently representing.

Stan represents us throughout the state, from his home office base in Wolfeboro. Interestingly our two top producers this year both live in Wolfeboro since Ed Settino moved back there this year.

Our company had the second best year in it’s recent history, and our commissions collected was only second to the high we hit in 2004.

We expect that 2008 will be a year “confused” by Presidential elections and all the fears of recession, but consider it a good time to buy a business, so we are looking forward to increased competition among our Associates for the Associate of the Year honors for 2008.

The following article is copied directly from the BizQuest newsletter, edited by Richard Parker (not a relative) and covers a very important topic. The original article can be viewed on www.BizQuest.com, a very valuable source of information about buying and selling businesses. Aside from the newsletter they are a major source of businesses for sale listings. See the link to their site on the left under “Business Resources”

Today’s Topic: Buying a Business with a Partner - A Marriage Made in Heaven (or Hell)

I receive a surprising number of emails from prospective business buyers who are thinking about going into a venture with a partner. Usually, it’s a family member, friend or business acquaintance. What I find astonishing is that most inquiries relate to whether or not there needs to be a formalized agreement between the parties. After all most note, the partners have known each other for many years, they get along great, and trust one another. That’s all wonderful but the answer is an overwhelming, unconditional and categorical “yes” – you absolutely must have a formalized agreement.

To give you a personal example, my brother and I owned a large company together. I would trust my brother with my life in addition to him being a tremendous business confidante. Our partnership was perfect but, if heaven forbid something happened to him or me, the last thing either of us wanted was to suddenly have the other’s spouse as our partner (even though we love our sisters-in-law). For this, and numerous other reasons, it just makes sense to have everytIt does not have to be a 50-page shareholder/partnership agreement but it must clearly spell out the necessary fundamentals. Everyone goes into a partnership all glassy-eyed and hopeful. Dreams are shared. You are convinced you’ll conquer the world together. Unfortunately, situations change. Like my first boss and late uncle once told me: “you never know a woman until you marry her, and you never know a man until you work with him”.

While you will want to have an attorney compile any agreement, a few of the issues to consider include:

• Definition of ownership
• Dealing with disputes
• Mechanisms to dissolve the partnership
• Procedures to follow and a pre-determined formula to value the business in the event of a buyout by one party
• Voting rights should one partner own the majority of shares (some issues such as dilution, binding the company, selling additional shares may need unanimous consent)
• Procedure to follow in the event one partner dies, becomes incapacitated and unable to contribute to the business for an extensive period of time

Above all, the agreement must be fair to both parties.

I have had many partners in the numerous companies I have owned over the years. Most were great, and only a few were disastrous. Personally, I am a huge believer in having a partner. If the combination is right you can really divide and conquer!

If you are going to buy a business with a partner here are a few things to consider:

• Partnerships work best when each party brings a distinct set of skills to the equation. In other words, you should each have your own area of expertise and not simply a duplication of skills.
• Just because you get along with the other party is not enough reason to go into business together.
• You need to formulate a list of fundamentals in advance that you both agree any business you consider purchasing must have in place. If not, each partner will find a reason not to buy every business you review.
• Understand that your personal relationship with the partner will never be the same once you’re in business together. It may get better. It may get worse. Just remember what my uncle said. In my opinion, it is never worth it to jeopardize a friendship over a business but that’s not always possible. Be mindful of it and try as best as you can to keep business and personal issues separate.
• You need to share the philosophy that the business comes first before individual personal gain. If you do right by the business, the personal rewards will always follow.

Business partnerships are a lot more difficult than marriage because there’s money at stake from day one and it can really influence people. Just like a marriage, a business partnership takes work; you must have full faith in the other party, and initiatives you undertake should be for mutual benefit. Most importantly like a marriage, if there are “issues”, you need to communicate no matter how difficult it may be. You cannot sweep problems under the rug hoping they’ll go away. Just like in a marriage, problems left unresolved or ones that are too big, will cause the business to breakdown and will likely not be salvageable.

It never ceases to amaze me how our customers use the gloom and doom media news stories as an excuse to either not make decisions, or make the wrong ones.

For an individual looking for a small business to buy, for whatever reason, their decisions about what to do of course need to be made against a backdrop of what is going on in the world. However, they also need to pay attention to the details of their situation and the businesses they are considering rather than assuming that if, for example, the stock market is tanking that the business they are looking at is also. For that matter when times are good in general they also have to pay attention to details, because a business that they are considering may be “sinking during a rising tide”.

We live with business cycles. After more than 20 years as a Business broker I expect that it will be hard to sell businesses during a presidential election campaign because of all the bad things the candidates say are or will be happening.

An entrepreneur who is going to be able to successfully run a small business will be able to understand the context within which the business they are looking at functions, and figure out whether it makes sense to buy it, regardless of what the media claims is going on on a national or global basis.

While there are few “recession proof” businesses it always appears that the downswing is not as bad as the doom sayers predict, just like the upswings are usually not as high as the euphoria speaders claim or predict.

So why is this a good time to buy a business?

• - Because the timid would be buyers are setting on the sidelines, so there is less competition,
• - The sellers are more willing to consider reasonable valuations for their businesses, particularly if business is down a bit,
• - The sellers may be more motivated if they ahve saved up during the good times and are not looking forward to a period of lower profits.

It is always a good time to buy a business, as long as you approach the marketplace intelligently. During a time of a business cycle going down is the best time to catch some bargains! Figure out how the current cycle is impacting the business you are interested in, and how the inevitable business cycles will impact it and buy into an operation that is going to be well placed as the cycle goes back up. For that matter a lot of businesses are not even bothered by some cycles.

There are risks involved in buying any business, at any time. How you evaluate them is what makes a difference. There will always be business cycles, and how you react to them and position your business will determine how they impact you.

And let’s not forget that while there are all kinds of stories about the credit crunch we still have local banks looking for deals to finance for some of the best interest rates in history.

So if you want to own a business it is a great time to shop for one, regardless of the efforts of the media and the politicians to convince you that the sky is falling! In fact their chatter may be establishing the right conditions for you to find a really good deal.