6 lessons yogi berra can teach you about selling your business

6 Things Yogi Berra CanTeach You About Selling

Your Business

"We Made TooMany Wrong

Mistakes"

Selling a small business iscomplicated. These key concepts -brought to you by Yogi Berra - willhelp you simplify the process.

For many entrepreneurs the processcan seem hopelessly complicated.

When faced with a daunting tasksometimes the best thing to do is to narrowyour focus. Concentrate on just a few core

ideas and actions.

These key concepts - brought to you byYogi Berra - will help you do just that.

Selling a business is

complicated

"90 PercentOf ThisGame IsHalf Mental"

Selling your business can be atense, uncertain process - so beready for an emotional roller

coaster.

Be mentally prepared for some uncomfortablesituations - like when a buyer criticizes you and your

business.

Even the buyer who loves everything about yourbusiness will try to lower the price as much as

possible by looking for faults.

Buying a business is risky.

Naturally a buyer will work to lower their risk as muchas possible. So throughout the process the buyer willalways ask themselves: “What could go wrong?”

"We MadeToo Many

WrongMistakes"

You will make mistakes.

Most of them you can

recover from.

The one mistake you can

never recover from is

trying to hide negative

facts about your

business.

Buyers aren’t stupid. If

your business is saddled

with serious debt,

regulatory challenges or

pending lawsuits

..........the buyer will find

out.

There is no problem

facing your business that

will kill your sale faster

than the loss of trust you

will experience when the

buyer uncovers

something you were

trying to hide.

"It Ain't Over Til It's Over"

No matter how

smoothly the deal

has gone, “it ain’t

over” until the buyer

and her advisers get

their chance to put

your business under

the microscope and

conduct their

"due diligence".

The term "due diligence" refers to the period during

which the buyer has the opportunity to investigate

your business completely. Again, their focus will be

on what might be wrong with the business.

Conduct yourself throughout the selling process

knowing up front that every claim you make will be

verified before any money changes hands.

"Little League Baseballis a very good thingbecause it keeps the

parents off the streets"

"Little League Baseballis a very good thingbecasue it keeps the

parents off the streets"

This quote has nothingto do with selling your

business, I justthought it was funny.

“A Nickel Ain’t WorthA Dime Anymore”

Hard to argue with Yogi’s point here. One amount ofmoney is not worth a different amount of money.

When it comes to valuing a business there are a lot ofnumbers you can consider.

But the number a buyer will care about more than allthe others combined is “Owner’s Benefit”.

The "owner’s benefit" is the amount of money thebusiness creates for its owner on an annual basis.Here’s the equation for coming up with your owner's

benefit:

Whatever the standard method for valuation is in yourindustry, the buyer will be interested in, and motivated

by, the Owner's Benefit.

Annual Pretax Profit + Owner's Salary + Owner'sPerks/Benefits + Interest + Depreciation

“When YouCome To A ForkIn The Road,Take It”

If you are lucky, eventually you will get an offer froma qualified buyer.......................

If you are lucky, eventually you will get an offer froma qualified buyer.......................

And it will probably be for less money than youimagined in your dreams

You will have to make a decision - do you accept anoffer that is just “okay” or do you hold out for more?

You will have to make a decision - do you accept anoffer that is just “okay” or do you hold out for more?

Of course your decision will be influenced bywhether or not you have any other viable prospects.

“The Future Ain’t What It Used To Be”

Yogi Berra has been famousfor living in the moment, fornever worrying about the

future.

But for the person buyingyour business the future is all

they will think about.

You can and should tout your history of growth, profits andhappy customers. But the buyer is interested in the future not the

past.

In order for someone to invest their life savings in your business,they must have a reasonable expectation that they can be as

successful as you have been.

The more your business has depended on your uniqueabilities and your personal relationships with customers

............................... the more a buyer will doubt your level of successcan be sustained once you are gone.

Buyers always have the option to do nothing. And if they can’tconfidently expect to continue your level of success, that is what

they will do. Nothing.

Remember:

Have you been trying to sell yourbusiness but met with frustration anddisappointment?

Read "Ten Thing You Need To KnowToday If You Want To Sell YourBusiness Tomorrow" to learn the factsabout what it will take to sell yourbusiness.

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