Thursday, July 21, 2016

FREE webinar to learn more about the Local Investing Academy



I've had several people recently ask me the same questions about my new Local Investing Academy which starts this fall.  

I've decided to do a webinar to answer them for everyone. 

If you think you may be interested in creating passive income for yourself based on the strategies in my 2014 best seller, Invest Local, then you may wish to check this out.

Click here to register for the webinar.

If you can't make the scheduled time, don't worry.  You'll get an e-mail with a link to a replay that you can watch within 48 hours of the live event.


Sunday, July 17, 2016

How to push your business' 'self-destruct' button... You can ruin everything really fast! David C Barnett



How to Sell a Business – Keeping it a secret

One of the most distinct aspects of the market for small businesses is that it is a secret one.  The worst thing that a business owner can do is publicize the fact that their business is for sale.

Telling people that you want to sell your business is like pushing the ‘business self-destruct’ button.
If any of the following stakeholder groups finds out that a business is for sale, the business could be ruined and all that an owner has worked for could be destroyed:
  • ·         Employees
  • ·         Customers
  • ·         Suppliers
  • ·         Lenders
  • ·         Competitors

I explain why secrecy is so important for each group in this NEW video: https://youtu.be/m0wWErgtlM0



I also explain what business for sale really means to 95% of the population.

Let me give you a little info on each one:

Employees: If they think change is coming, they may bail.  The best employees always have available opportunities with competitors.

Customers: If you deliver in the future or people rely on a warranty, they won`t have any faith in your future if they find out you’re for sale.

Suppliers: If these guys think there`s something wrong say `goodbye` to your trade credit.

Lenders: I’ve had more than one client have their credit line cut when their banker found out they were for sale.  I explain why in the video.

Competitors:  These guys will use anything they can to steal business.  News that a business is for sale will help them sew doubt in the minds of prospects.

If you want to learn how I help my clients advertise their business for sale confidentially, check out www.HowToSellMyOwnBusiness.com

There are plenty of FREE resources there to help you begin planning your transition out of your business.

Please remember to like and share this article, it’s the only way the people who run the internet have of knowing if the content is any good or not. The more you share, the more likely someone who needs this information will be able to find it.

If you would like to hear from me weekly before anyone else, you can sign yourself up at www.DavidCBarnett.com 

Do you live in Toronto?  I’ve got three workshops coming up for Toronto in September.  Book now to get summer special ticket pricing.  http://davidbarnett.eventbrite.ca Some sessions have fewer than 20 seats left. Learn more about these workshops in this video: https://youtu.be/l2T3pwr9lkw

Thanks and I’ll see you next time.





Sunday, July 10, 2016

This one change earned a business seller $250,000 more! - David C Barnett



A few years ago I put out a video on YouTube about a guy who sold his business for more than I thought he could by offering financing terms to a buyer that were better than the bank’s. Watch that video here: https://youtu.be/rkdB8eLl6Xw

Just this week I had the opportunity to coach a seller along the same lines.  In fact, it worked out so well that his words to me were, ‘the money I’ve invested with you is the best money I’ve spent in my entire life.’

Those were very kind words.

Watch the story of the negotiation here: https://youtu.be/iqo5EngtGa8



This seller was properly prepared and he and his spouse were going to be able to benefit from tax-free gains because they were doing a share sale of their business.

He had come to me for advice on the negotiation and I showed him a way to get the buyer to agree to a price that was $250,000 higher than what they had previously agreed to by offering to change the terms of payment.

Having the correct advisors working with you in a complex transaction like this is worth every penny.  When it comes time for you to buy or sell a business, give me a call for help.

If you want to learn more about how I help business owners sell their own business and avoid paying a commission, check out www.HowToSellMyOwnBusiness.com

There are plenty of FREE resources there to help you begin planning your transition out of your business.

Please remember to like and share this article, it’s the only way the people who run the internet have of knowing if the content is any good or not. The more you share, the more likely someone who needs this information will be able to find it.

Improve your business each and every day, download my FREE daily cheat sheet and hang it in your work area to keep yourself focused. https://gum.co/15Questions/FREE 

Do you live in Toronto?  I’ve got three workshops coming up for Toronto in September.  Book now to get summer special ticket pricing.  http://davidbarnett.eventbrite.ca Some sessions have fewer than 20 seats left.


Thanks and I’ll see you next time. 

Tuesday, June 28, 2016

Sunday, June 26, 2016

Don’t fall for this income double-counting trap when analyzing a small business


In the past month I’ve had two business-buying clients who’ve gotten caught in this trap. 

If you buy a business believing that the cash flow to the owner is $200K and in reality it’s only $100K, you’ll be in big trouble.

How does this happen? Watch the video here:  https://youtu.be/64KgCW9I0wo



In order to understand what is going on in a small business, a process of normalizing the income statement is necessary.

We need to understand the true benefit of ownership.  Sometimes, personal benefits are hidden in the expense lines.  For example: a restaurateur who takes personal groceries home from the business.  These items can add up substantially.

In the normal process of doing this, the analyst takes the net income and then starts ‘adding-back’ items to get a new normalized cash flow.  This cash flow figure is called the Seller’s Discretionary Earnings or SDE.  It is the total cash available to an owner of the business.

Small businesses are typically valued as a multiple of SDE.

Here’s the problem: sometimes owners don’t take a salary which would appear in the wages expense, they instead take dividends which happens on the balance sheet.

Net income from an income statement appears in the equity section of the balance sheet.  At the end of the year, it gets rolled into ‘retained earnings.’

So if a seller is taking dividends, it is removed from the equity section of the balance sheet.  If you add the dividends to net income, you are effectively double-counting the same dollars.

Don’t let it happen to you. 

Learn how to buy a business the right way and control risk.  Visit www.BusinessBuyerAdvantage.com to learn more.  If you want to engage my help, send me a message or call me at 506 381 8416.  I work with people all around the world.

Please remember to like and share this article, it’s the only way the people who run the internet have of knowing if the content is any good or not. The more you share, the more likely someone who needs this information will be able to find it.
Sign up to my FREE weekly e-mail to get information like this every week before anyone else.  Sign up on the left of this post.

Do you live in Toronto?  I’ve got three workshops coming up for Toronto in September.  Early ticket pricing ends June 30.  http://davidbarnett.eventbrite.ca


Thanks and I’ll see you next time. 

Wednesday, June 22, 2016

Local Investing Course Discontinued June 30

How to do Small Local Investing Deals from A-Z will be discontinued as of June 30.

This course has been available for more than 12 months and it's going to be removed and re-formatted.  If you want to do this self-study program on your own, buy it today: www.LocalInvestingCourse.com

It will be replaced by an online academy program which will feature:
  • A semester schedule.
  • A private FaceBook group for students to communicate and learn from each other.
  • A moderated mastermind group for 4 months which will take you from your start to doing your first deal.
  • Lifetime membership to the graduates  group to help you keep in touch with other students who've gone through this process and are doing deals today.
The new program will require a larger investment.  If you are sensitive to price, you should buy the existing online self-study course which will no longer be available after June 30.  It features hours of video tutorials and is just like sitting in a class room.  Visit www.LocalInvestingCourse.com to learn more.

If you're interested in doing the new program, e-mail dbarnett@alpatlantic.com  and let me know.  I'll send you an early-registration offer when the new program is ready this summer.

Thanks

Dave

Sunday, June 19, 2016

Should you Sell Your Business to your Employee? Viewer Question - David C Barnett



Two weeks ago I was in Dartmouth, NS talking with the commercial loan officers of Atlantic Canada’s credit unions about business valuation.

At the end, I got a question from the floor about succession planning.  ‘Does it make sense to sell a business to an employee?,’ asked one of the attendees.

I know you’re going to hate this but, it depends.  Watch the full story in this video: https://youtu.be/ODZF3gTeETc



In well organized, maybe larger businesses, managers have well defined roles and responsibilities.  They manage their own business plan and make decisions about resources and employees.  It’s up to them to perform and they’re accountable for what happens.

This type of person may be able to transition into entrepreneurship.

In many smaller businesses which are ‘technician run,’ to borrow the terminology from Michael Gerber’s E-Myth book, it is not so easy.

These small business operators keep most of the strategic procedures and policies in their heads and ALL the responsibility.  Sometimes a long-time employee who is really great at handling a long list of complex TASKS is given the title of ‘manager.’  This doesn’t actually make them a manager.

I’ve been involved in two such successions and both buyers failed after about two years.  They were never the right candidate to weather the stress involved in business ownership. 

Most importantly, however, they didn’t have the drive and ambition.  If they did, why were they still working in someone else’s shadow for all those years?

Most business owners want to try to find a buyer on their own.  80% of small businesses are sold in the private market and mostly because owners don’t want to pay any type of commission to a broker.
So who do you look for when you need to find a buyer?

Try the ones who got away.  The good employees that you hated to lose because they knew the business and were really capable.  The ones who left because they wanted more.  These are the people with ambition.

If you want to learn more about how I help business owners sell their own business and avoid paying a commission, check out www.HowToSellMyOwnBusiness.com

There are plenty of FREE resources there to help you begin planning your transition out of your business.

Please remember to like and share this article, it’s the only way the people who run the internet have of knowing if the content is any good or not. The more you share, the more likely someone who needs this information will be able to find it.

If you would like to hear from me weekly before anyone else, you can sign yourself up in the form to the left of this post.  

Improve your business each and every day, download my FREE daily cheat sheet and hang it in your work area to keep yourself focused. https://gum.co/15Questions/FREE 

Do you live in Toronto?  I’ve got three workshops coming up for Toronto in September.  Book now to get early ticket pricing.  http://davidbarnett.eventbrite.ca

Thanks and I’ll see you next time.