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Information for Sellers
Many business owners do not realize the complex issues that arise when attempting to sell their business. This, together with an inability to remain neutral after investing their entire lives to growing their business, makes it a definite asset for a business owner to seek the expertise of experienced business intermediaries.
Cornerstone Business Services, Inc offers sellers:
- Unique & innovative marketing programs
customized for each client
- An objective, third party view of their
company
- A team of experienced professionals that
assist the seller every step of the way
- Open and constant communication
- State of the art technology
- Unbiased answers to questions
In performing these services, we may find that the seller’s ultimate goal does not match what the current market can provide. Our commitment is to an honest evaluation of what a sale will reasonably bring the seller. If the end result is not what the client is expecting, we can also provide the client with advice on an exit strategy that will involve methods for getting the business to a better future sales value. With this commitment to honesty and to our client’s ultimate goal, we will ensure the best value for the seller.
Confidentiality:
Cornerstone understands the need for confidentiality in today’s market. A breach of confidentiality could damage an owners existing relationships with employees, competitors, creditors, and suppliers, thus damaging the sellers ability to reach their ultimate goal.
Cornerstone has developed a process to help ensure confidentiality. Potential buyers are thoroughly screened and pre-qualified to insure their intent is serious and they are committed to purchasing a business. These buyers are then allowed to review information on businesses through a Non-Confidential Business Review, allowing them to screen potential businesses and narrow down their interest prior to receiving any confidential information on any of our listed businesses. Before ever receiving detailed information about your business, potential buyers are required to sign a confidentiality agreement that enters them into a legal contract, prohibiting them from revealing any confidential information regarding your business.
Confidentiality is also strictly upheld in all marketing efforts. All advertising done through publications such as trade journals and web pages is done in generalities. Specific information that would reveal the identity of a business is never used.
The Cornerstone Process:
Cornerstone has developed an innovative proposal process:
1. Seller Objectives
Initial meetings are to discuss the seller’s objectives and help us to understand the seller’s ultimate goal. This includes determining an approximate financial goal, a time goal, a discussion of the process, and a level of commitment for selling.
2. Analysis and Evaluation of the Company
80% of a typical private business owner’s net worth is tied up in his or her business. As a result, an accurate determination of the firm’s value is essential to ensure proper compensation for years of hard work and personal investment. By identifying individuals and synergistic, strategic, industry and financial buyers, we most often achieve this targeted goal.
Privately held companies suppress earnings to reduce tax liabilities. Because of this we dissect the financial history of the business line by line to uncover the hidden value of the company. Our extensive evaluation process involves state-of-the-art methods in obtaining an accurate consensus of business value. The in-depth analysis identifies and illustrates the firm’s future income potential, which is critical to obtaining maximum value.
3. Commitment to the Process
After an agreement has been reached regarding value and the process by which Cornerstone will market your business, we will look for a commitment to the process. If an agreement has not been reached, Cornerstone will be happy to sit down and discuss what you can do as a business owner to bring your business closer to your goal.
4. Marketing Materials
Cornerstone will then develop the comprehensive marketing materials known as the Confidential Business Report or CBR. This report will provide potential buyers with an in-depth review of your business including financial information, detailed breakdown of the building improvements, products or services your business provides, and a summary of your businesses strengths and weaknesses including ideas for improvement, giving a potential buyer a glimpse of future earning potential and growth opportunities. We will also prepare non-confidential marketing materials, such as ad copy and the Non-Confidential Business Review, a one-page introduction to your business that does not disclose any confidential information. Cornerstone requires that the seller has an active role in preparing this information and all finalized materials must be approved and signed off on by the seller.
5. Strategic Marketing Plan
Cornerstone has developed a database that not only includes numerous potential buyers, but also many professional associations that have their own knowledge of potential buyers. Using state of the art technology, Cornerstone will match certain criteria from potential buyers to that of your business and narrow down a group that will be directly marketed for the sale of your business. We will also utilize several local and regional advertising forums that will reach the appropriate audience for your business. Due to Cornerstone’s affiliation with several other brokerage firms across the country and several trade associations, we can also utilize these resources if applicable. All of these methods combined with direct mail capabilities and a full time staff of experienced marketing professionals and brokers that work together to brainstorm additional ideas, provide you, the seller, with exposure to a large range of resources.
Cornerstone also commits to a high level of communication with our client, regarding developments with the sale of their business containing the following information:
- Results of advertising and direct mail campaigns
- Status of inquiries; if still interested, if requesting additional info, if requesting a site visit, etc.
- A list of common questions and objections we received when presenting the marketing materials
Cornerstone welcomes ideas from sellers, and frequently recommends sessions with the seller to brainstorm these ideas, and offer suggestions for overcoming common objections uncovered in initial marketing efforts.
6. Negotiations and Closing
Finally, Cornerstone will assist the new buyer in drafting a purchase agreement, if requested, and in setting the closing in to motion. Our staff will assist the seller in all negotiations, handling of paperwork associated with letters of intent, coordinate the due diligence process, and assist the buyers closely with their financing process. Cornerstone has established its own proprietary closing checklist to ensure that all parties are aware of their specific tasks and the date by which each must be completed to ensure a smooth closing process. Cornerstone has also established excellent working relationships with several banking institutions, as well as attorneys and accountants who specialize in this process, people we can call on to assist with the transaction both for the buyer and seller. By staying on top of all details associated with the closing process, we assure that the experience is as stress-free as possible for all parties, and that the final closing is merely a formality of physically signing the necessary documents.
Please contact us to discuss your specific concerns.
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