THE GUIDE TO BUYING A BUSINESS THE PLAYBOOK BUILT FOR BUSINESS OWNERS AND ENTREPRENEURS Your Business Matters AlexanderAbramson.com • (407) 649-7777 February 2019
As you may know, we recently published our new book, The Guide to Buying a Business . For those of you who’ve already secured your free copy, congratulations! For those of you who haven’t, there’s still time!
To whet your palette a bit, below is an excerpt from the introduction. If you’re intrigued and want to know more, you can snag your own copy at AlexanderAbramson.com/GBaB.
TWO TYPES OF BUYERS
startup, with many of the problems and concerns that we laid out earlier.
Up to this point I’ve been speaking to a certain type of business buyer, one who’s looking to make an investment for the future. Let’s call this an investment buyer. This entrepreneur wants to buy a business for its income stream and potential for future growth. But I certainly don’t want to make it seem like the only reason to purchase a business is to make an initial venture into the business world. Buying a business can also be a vital part of a strategic plan to grow an existing business. We’ll call this entrepreneur a strategic buyer. In this situation, he purchases a business for access to a component of the company that can be used to improve or expand his existing business at a lower cost than organic growth through internally generated sales or expansion. Consider a company that sells printers, let’s call it Sabre, and it wants to sell its products into a new market. It could try to sell directly to that market. But its sales would be limited by the experience and credibility of its sales team in that market and by its understanding of the market’s needs and terminology. It would, in essence, be a Sabre and Dunder Mifflin
If, on the other hand, Sabre decided to buy a paper company, let’s call it Dunder Mifflin, which already served the newmarket, it would acquire Dunder Mifflin’s customer base and products or services, as well as an experienced sales force with a reputation and staff experienced with the newmarket. Purchasing Dunder Mifflin is a strategic acquisition because, in addition to the cash flow coming from Dunder Mifflin’s established operations, Sabre can grow its original business by piggy-backing on Dunder Mifflin’s existing distribution network and by selling more of its printers through the new sales channels. It may also be able to improve Dunder Mifflin’s profits by cutting costs from duplicated back office operations.
Many (if not most) small businesses for sale are over-priced. Some have serious operational problems and are on the brink of closing. And some business owners are downright dishonest. The best way to guard against these issues is to educate yourself on the process of buying a business. Then, you should engage professional advisors to investigate the business with you and to prepare all of the proper documentation. So, you’ve got to be diligent. You’ve got to understand the buying process, know the risks and how to protect yourself from them, and do your homework on the business. You skip these steps at your own peril.
IT’S NOT ALL RAINBOWS AND BUTTERFLIES
Want to read the rest of this chapter and the other 11 chapters? Go to AlexanderAbramson.com/GBaB to request your free copy of the book!
I don’t want you to think for a moment that buying a business is a cake walk. Whether you are an investment buyer or a strategic buyer, buying a business requires focus and caution. You don’t want to take on the seller’s problems or, worse, pay for something that’s going to be out of business in a fewmonths.
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Strength of Mind Tips to Keep Memory Sharp and Improve Cognitive Function
Irish poet Oscar Wilde once called memory “the diary that we all carry about with us.”Of course, in Wilde’s time, the average life expectancy was less than 50 years old. As modern medicine continues to enable people to live longer, these “diaries” tend to become muddled. Fortunately, there are ways to counteract the natural dulling of our memory that comes with time. Just like any other muscle, our brain needs a workout in order to stay strong. As Dr. Celeste Robb-Nicholson of Harvard Medical School writes, “Challenging your brain with mental exercise is believed to activate processes that help maintain individual brain cells.” Activities like solving puzzles, learning a musical instrument, or picking up a new hobby work wonders to keep your mind active and your memory sharp. These mental exercises are especially important after retirement, often to make up for the loss of stimulating challenges that work used to provide. PUZZLE YOURSELF
SPEND TIME WITH FRIENDS AND FAMILY
Taking care of our physical health has also been shown to help brain function. According to a study by Sydney University in Australia, aerobic exercise is particularly good at jogging our memory. The researchers note that “aerobic exercise acts by preventing the usual decrease in neurogenesis associated with aging, thus resulting in greater retention of neural matter — particularly in the hippocampus.” In short, exercises like swimming and running keep the part of our brain responsible for memory from shrinking.
Humans are social creatures. Many studies have shown that being a part of a supportive social group can significantly benefit our physical and mental health. In fact, the American Journal of Public Health reports that people who have daily contact with friends and family cut their risk of dementia and mental impairment almost in half. Our mental diaries may be longer and fuller than they were in Wilde’s day, but if we fill those pages with hobbies, exercise, and close friends, our memories will remain sharp and vivid for the rest of our days.
percent of respondents believed they could rely on the support of their managers and colleagues. The Reason Employees Are Quitting in Droves The numbers paint a disheartening picture of the average workplace. If you’ve been a manager for a long time, it can be difficult to imagine how frustrated an undervalued member of your team can feel and how these feelings can spread throughout your organization, leaving all your employees discontent. It’s imperative to listen and respond to your employees’ concerns. It takes more than instituting an open-door policy and relaxing work requirements — two characteristics of healthy workplaces, as rated by respondents. You need to commit resources to eliminating the problem. Start with the highest-level leaders of your business. Work with them on how to interact with the rest of your team in more human, empathetic, and responsive ways. Training and assessments are a good start, but you may also need to revamp the mentality and core values of your company. In a world where finding a new job is easier than ever, managers cannot afford to ignore the needs of their employees. Evolve and acknowledge the emotions in your workplace or risk losing all that you’ve invested in your top performers.
According to a survey conducted by Randstad, 60 percent of American employees either quit or strongly considered quitting their jobs last year. That’s a number that should terrify any business owner. However, instead of panicking, consider this record-breaking moment in U.S. employment history an invitation to take a long, hard look at your organization. Are members of your team waiting for the perfect moment to bail? And if so, why? It’s not because the majority of employees are ruthless careerists or disloyal money-grubbers. If we look at Mental Health America’s 2018 Workplace Health Survey, it mostly boils down to the fact that over half of American employees feel unappreciated, unsupported, and disrespected by management. In fact, 21 percent of respondents said that instead of being paid what they deserve, they’re nickel-and-dimed when raise season arrives, and 77 percent believed that instead of being lifted up for their accomplishments, employees were forced to toil away in the corner, feeling invisible. Sadly, scarcely more than 34
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The Most Important Job
3 Ways a Bad Receptionist Can Ruin Your Company
If you have a receptionist in charge of answering phones and greeting people who walk through the door, you need to know they’re making an excellent first impression. This applies to every company, from dental offices to law firms. A great receptionist can make your life easy, while a bad receptionist can lead your company to ruin. Here are three important red flags to watch out for.
and you never call them back because you weren’t informed? What if a client’s file goes missing in a messy filing cabinet? A receptionist with poor organizational skills can increase stress around the office and anger clients.
1. THEY PUSH CLIENTS AWAY.
As your gatekeeper, part of your receptionist’s job is to filter the lines of communication and make sure no one’s time is wasted. However, a receptionist should never treat clients like intruders interrupting their workflow. You want people to feel welcome at your company. Otherwise they won’t want to keep doing business with you. This attitude should also extend to the rest of your employees. If your receptionist treats their coworkers like pests, there’s a chance they will treat clients the same way.
3. THEY’RE NOT TECH-SAVVY.
As your company’s jack-of-all-trades, your receptionist should be able to learn whatever software the company uses, from word processors and Excel to industry-specific software. Your receptionist should also be able to easily learn new skills to facilitate system improvements and new technology. The last thing you want is company-wide changes to halt because your receptionist insists on doing things their way.
2. THEY’RE DISORGANIZED.
When you are hiring a receptionist, take the time to find a candidate who will make life easier for everyone at your company. You won’t regret it.
Your receptionist is responsible for relaying information to the rest of your company. What happens if a client calls while you’re in a meeting,
Take a Break!
VALENTINE’S DAY COOKIE CARDS
2 large egg yolks
• • • •
2 1/4 cups all-purpose flour
2 teaspoons pure vanilla extract Royal icing, sprinkles, and edible markers, for decorating
3/4 cup sugar
1/4 teaspoon salt
2 sticks unsalted butter, cold and cut into 1/2-inch cubes
to low, and mix until dough congeals. 4. Carefully roll dough into a
1. Heat oven to 375 F. 2. In a mixing bowl, combine flour with sugar and salt. Add butter and combine using a mixer at low speed, until butter breaks down into small, crumbly pieces. Increase mixing speed to medium and mix until butter and flour clump. 3. Add egg yolks and vanilla extract to bowl, return mixer
sheet 1/16-inch thick and cut into 4x6-inch cards.
5. On a parchment-lined
baking sheet, bake cookie cards for 6 minutes, rotating the pan halfway through. 6. Let cookies cool completely, decorate, and distribute.
Inspired by Food & Wine magazine.
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Inside This Issue
The Guide to Buying a Business PAGE 1 3 Ways to Improve Your Memory PAGE 2 Why Employees Are Quitting in Droves PAGE 2 Is Your Receptionist Chasing Away Clients? PAGE 3 Take a Break PAGE 3 Valentine’s Day Cookie Cards PAGE 3 All About Chocolate PAGE 4
WHAT YOU DIDN’T KNOW ABOUT CHOCOLATE Fun Facts to Wow Your Loved Ones This Valentine’s Day
German chocolate actually has nothing to do with the country of Germany, either. It used to be called “German’s chocolate,” named after its inventor, Sam German, an American who made sweet chocolate for baking. Adding sugar to the chocolate made it a go-to option for bakers around the world, and the base for German chocolate cake was born.
Chocolate is a treat savored by people all over the world. What we know as the sweet, creamy decadence that sustains Valentine’s Day actually has greater historical and cultural significance. Fermented chocolate drinks have been dated back to as early as 350 B.C. The Aztecs believed it was the beverage of wisdom, and the Mayans saw it as something to be worshipped. While the history of chocolate is as rich as its flavor, there are some common misconceptions about the treat.
For chocolate to be classified as Swiss, it has to be made in Switzerland, as chocolate- making is considered an art form in the country. Known for its “melt in your mouth” quality, Swiss chocolate uses condensed milk to add a velvety texture. Many chocolate makers outside of Switzerland will refer to their interpretations of Swiss chocolate as milk chocolate instead.
Dutch chocolate doesn’t necessarily refer to chocolate made in the Netherlands; the
name refers to a specific chocolate- making process that uses the cocoa press. Before Dutch chemist and chocolate-maker C.J. van Houten invented the machine in 1828,
chocolate was only used in beverages. Dutch chocolate is chocolate that has been modified with an alkalizing agent in order to produce a milder flavor, making it a fantastic option for use in baked goods, candy, and ice cream.
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