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Will You Add? - Due Dilegence 101 Or What You Do Not Know Can Kill You! - Part 1
What this means is that you are going to want to pick up the phone and call your prospect IMMEDIATELY. Why is this so important? Because the degree of responsiveness your prospect shows toward you and your offer is directly related to how quick you call them after they have asked for more information.This is so important. The sooner you call them, near the time they filled out the form, the better they are going to remember what they read and why they filled out the form. This is why our leads are so much more responsive than most other leads because we give you the ability to call them before they have a memory lapse.STEP #1 - IDENTIFY YOUR PROSPECT'S NEEDSMake warm remark about the area they live in just to bridge the gap, or break the ice and get them feeling warm and friendly toward you.NOTE: Now is when you want to ask them 3 pertinent questions that will eliminate 90% of all the objections and smoke screens they would otherwise come up with later on. Remember, the purpose of these questions is to get your prospect to say, "I'm sick of my current situation and I want more out of life than what I've been getting."QUESTION #1"What Kind of work are you in?" You'll want to ask them if they're working full time or part time and if they like what they're doing.QUESTION #2"Are you looking for something to replace what you are doing, or just something to supplement your current income?" Your prospect might say, "Well I don't know yet. I haven't even heard what it is that you are doing?"QUESTION #3"Let me ask you something Mr. Prospect. Can you see yourself 5 years from now, doing what you're doing right now?"These questions are meant to get your prospect to tell you in one way or another that they are tired of their current financial situation and want more out of life. It is of UTMOST IMPORTANCE that you get your prospect to tell you this with their own mouth BEFORE you go to the next step. If done properly, you will dispel most of the objections
Make the seller show you the details on some or all of these expenses to verify that they are really personal and not actually business expenses that shouldn’t be added back to profit. Spend time asking detailed questions with the general ledger in front of you. Go through individual charges and wh
If you want to be a subcontractor to a prime contractor, you will most likely need to obtain a surety bond. Bid bonds, performance bonds, and payment bonds are the three main types of surety bonds. A bid bond is submitted when you bid on a project, and obligates a firm to honor its pricing if it is awarded a contract. A performance bond obligates a company to complete a project according to the contract terms. A payment bond is a guarantee that the firm will pay all its subcontractors, craftspeople, and suppliers. If you fail to honor the terms of the surety bond, then the surety company that issued the bond will be responsible for paying.Because of the risk involved, surety companies review detailed credit and financial information about your firm before issuing a bond. Your company has to prove to the surety company that it is capable of honoring its commitment. If you are granted a bond, you pay a premium (similar to an insurance premium) for the surety bond.The Small Business Administration has programs in place to help small businesses get the bonds they need. The agency's Surety Bond Guarantee Program will guarantee bonds as high as $2 million, and is open to all small businesses. Bonds are issued by a surety company, and the SBA will guarantee 70% to 90%, depending upon the program.
This article is written as a general discussion on the subject of “Due Diligence”. It is for informational purposes and not intended to be a definitive guideline for your exact situation. You should consult the appropriate professionals with regard to your specific transaction or situation. Further, this article is in no way advocating, suggesting or implying that anyone engages in any type fraudulent activities whatsoever. These are simply the things a buyer should be aware of when doing due diligence in buyer a business.
Due Diligence Defined:
The phrase is composed of two words. “Due” which the dictionary defines as “Proper or Adequate” and Diligence, which is defined as “Degree of care or caution expected of a person. Especially as a party to an agreement.” Caution: is the watchword in this definition.
Financial Statements – What to look for:
Add Backs: If you bought the business through a business broker you should have received the business financial statement with a separate worksheet showing adjustments to those statements. These adjustments show the owner’s benefits received from the business besides the profit and salary he receives. These can also be defined as personal expenses that need to be added back to the profit. Depreciation, incomes taxes, interest expense are add backs that are not personal. Personal includes such things as family auto expenses, owner life insurance, owner health insurance, business entertainment that was not really spent on clients, business trips not really for business, home office expenses, family cellular phones and much much more.
Make the seller show you the details on some or all of these expenses to verify that they are really personal and not actually business expenses that shouldn’t be added back to profit. Spend time asking detailed questions with the general ledger in front of you. Go through individual charges and wha
During my many years of professional experience I was constantly researching the roots for success or failure. I was poised to find out what it was in the end what made a difference. I am sure that is something every entrepreneur would like to know and there are lots of books out there dealing with different issues.When reading through many of those books and comparing it with my experience on a daily basis I felt that there was something important missing. Sure, probably all the more than obvious reasons are listed and even advice is given how to control that. Processes are recommended with step-by-step instructions on how to follow it and yet very often it’s just not working. So together with my partner we developed a system.Think about what you have already tried out and done, but are you satisfied with what you got? Or do you also feel that there must be something more to it?Here is a case study for you of a client of mine to illustrate what I mean:This entrepreneur was successfully running a midsize business in a rural environment outperforming competitors even during tougher economic times. He was presented with the opportunity to acquire a poor performing competitor three times the size of his business in a nearby city.First big mistake made:Being successful for so many years my client made the decision to just implement all his processes in place for the acquired business. He was absolutely sure that what worked in his business would work there as well. It didn’t!Second big mistake made:In order to be in control what was going on he hired a General Manager who was pre-screened by the usual process. Since he knew him personally he was sure that it would work out. It didn’t!Third big mistake made:Since he was too busy to be personally there and supervise the new business he decided that weekly meetings with the General Manager would do it! It didn’t!Fourth big mistake made:yone engages in any type fraudulent activities whatsoever. These are simply the things a buyer should be aware of when doing due diligence in buyer a business.
Due Diligence Defined:
The phrase is composed of two words. “Due” which the dictionary defines as “Proper or Adequate” and Diligence, which is defined as “Degree of care or caution expected of a person. Especially as a party to an agreement.” Caution: is the watchword in this definition.
Financial Statements – What to look for:
Add Backs: If you bought the business through a business broker you should have received the business financial statement with a separate worksheet showing adjustments to those statements. These adjustments show the owner’s benefits received from the business besides the profit and salary he receives. These can also be defined as personal expenses that need to be added back to the profit. Depreciation, incomes taxes, interest expense are add backs that are not personal. Personal includes such things as family auto expenses, owner life insurance, owner health insurance, business entertainment that was not really spent on clients, business trips not really for business, home office expenses, family cellular phones and much much more.
Make the seller show you the details on some or all of these expenses to verify that they are really personal and not actually business expenses that shouldn’t be added back to profit. Spend time asking detailed questions with the general ledger in front of you. Go through individual charges and wh
We all know that a good first impression has a long lasting impact. Human beings have the inherent nature of building up their perceptions on the basis of visual stimuli. This particular aspect of human nature is applicable in all walks of life. Be it dressing up smart for an interview/ presentation, wrapping a gift in an elegant paper or even a good handshake with a pleasing smile while meeting a person…the ways we adopt to impress is beyond the scope of compilation. We all strive to make that good first impression to make things work in our favor. It is often believed that a good first impression is all about being flamboyant and colorful. This notion is not necessarily true coz strong messages if communicated in a simpler way can serve the purpose in the best possible manner. A simple logo design that conveys a strong message can lead to the creation of a magical brand.A logo is an image that represents a company to the outer world. It may not essentially communicate about the business domain of a company but should ideally generate a certain sense of being positive and trustworthy. Think of the swoosh symbol of the “Nike” logo. Nike is a well-known brand dealing in sports shoes and clothing. The swoosh symbol hardly has anything to do with its product line, but it generates an even stronger and positive message. It all depends on how we perceive this logo. Some may see it as a “tick” indicating it as a choice (among the rest) while some others may interpret it as a rising curve that depicts the success of the brand and there could be some having a different interpretation altogether. The Nike logo is a classic example for the importance of having the element of simplicity in a logo. The use of a swoosh can be found in the form an arc, a partial ellipse or an orbit in the logos of well known corporate entities like Samsung, Infineon, Whirlpool and many others.The primary reason of such success and wide usage of a swoosh is mainly due to its simplicity, timelessness and the flexibility of reproducing it i
Financial Statements – What to look for:
Add Backs: If you bought the business through a business broker you should have received the business financial statement with a separate worksheet showing adjustments to those statements. These adjustments show the owner’s benefits received from the business besides the profit and salary he receives. These can also be defined as personal expenses that need to be added back to the profit. Depreciation, incomes taxes, interest expense are add backs that are not personal. Personal includes such things as family auto expenses, owner life insurance, owner health insurance, business entertainment that was not really spent on clients, business trips not really for business, home office expenses, family cellular phones and much much more.
Make the seller show you the details on some or all of these expenses to verify that they are really personal and not actually business expenses that shouldn’t be added back to profit. Spend time asking detailed questions with the general ledger in front of you. Go through individual charges and wh
Training employees and educating consumers to be able to use particular computer software is a tough job. It takes time and skill to write training manuals and design illustrations to go along with them. That's why many business owners are choosing computer courseware instead of creating training manuals of their own. Computer courseware is pre-designed and customizable so you can arrange the lessons and customize them to fit your training needs. It saves time and money, and can be done easily in-house once you have a copy of the training materials. What is Computer Courseware? Computer courseware is software and/or training materials used for educational purposes. Educational institutions may use courseware to teach students how to operate a particular computer software program. Companies may use it to educate employees on using a new software program that has been installed for business operations. Also, companies that sell computers, software, or other related products and services might offer computer courseware to their customers as a free "how-to" guide. The training courseware can be used for almost any type of computer software. There are Macintosh manuals, Microsoft courseware, Adobe Photoshop courseware, Excel courseware, and many others. Tips for Maximizing your Computer Courseware Benefits To get the most benefit out of your computer courseware, use it in creative ways. For example, package it nicely and offer it as a free bonus with a purchase to your clients. If you sell Microsoft Word software, then advertise up-front that each customer will receive a free beginner's course on how to use Microsoft Word. Then, include your Microsoft courseware with each purchase. If shipping products, package it neatly with the product. If selling in-store, make sure your employees know to give the bonus courseware with each purchase. If you sell Macintosh computers, provide free Macintosh manuals with the computer. Those customers who are brand new to Macin
Make the seller show you the details on some or all of these expenses to verify that they are really personal and not actually business expenses that shouldn’t be added back to profit. Spend time asking detailed questions with the general ledger in front of you. Go through individual charges and wh
In a society that is dominated by corporate businesses and large businesses, there is a large amount of franchise opportunities available to the public. Depending on what it is that interests you, there are franchises for every sort of business that you can act on as a buyer or owner. Why stop with one franchise, if it is something that you are capable of doing and enjoy doing then jump on as many possibilities as you can, because the sky is the limit for franchise opportunities.Within the various franchise opportunity websites there are several places to help narrow your search down. The first question you may want to ask yourself is what field interests you and do you have the most experience in? While you may be interested in something, it is important to remember that there will be a lot of investment going into this decision and it is important that you know what you’re doing. At franchise.com they make it very accessible to find the type of franchise you want to get into, along with narrowing it down to a specific region in the world.http://www.franchise.com/en/us/template/buyer%2CDefault.vmAfter selecting the type of franchise you wish to get involved in, consider what price range you are looking at investing towards the franchise. While the list of franchise opportunities is endless, the amount you are willing to put into it will determine how many options you have to work with. The more you want to spend, the more options you will have and the bigger and better known the business will be to the public eye.When purchasing something that is high priced like a franchise, it is always recommended that you seek the advice of a lawyer, financial consultant or accountant before purchasing anything. There are so many things that must be covered within paperwork and legal regulations that it is important to consult with an expert to make sure everything is properly handled. A financial consultant can also assist you with site selection and lease negotiation services.At franchis
Make the seller show you the details on some or all of these expenses to verify that they are really personal and not actually business expenses that shouldn’t be added back to profit. Spend time asking detailed questions with the general ledger in front of you. Go through individual charges and what they mean, until you fully understand what is being added back and why.
Inventory:
Inventory of resale merchandise must be checked for two reasons. One is you have to pay for it. Be careful, you do not want to buy merchandise that is old, worthless and not saleable anymore. Only pay for current marketable product. The price you are suppose to te pay for the inventory is the seller’s cost. The price for old slow inventory is negotiable. Always spot check the price and count the merchandise listed on the inventory list. Do people put down that there is three of an item when there are only two? Of course, especially when they think no one is going to be checking them out. Comparing prices from purchase invoices is how you check prices. You cannot check every item against the actual cost but you can do 5% of the items. Pick at random, not by any suggestion made by the seller or others. If you do not understand how marketable the inventory is that you are buying, hire an expert, from that industry. Your broker should be able to help you in finding someone. Do not be cheap, and think you do not need to spend the money on an expert adviser. I will take a lunch bet that they will pay for them selves many times over.
The second reason for checking inventory is that if a seller doesn’t take inventory at least yearly and adjust his inventory value in his accounting records, accurately, the profit figure you are receiving will not be accurate. As a rule, the higher cost of goods sold, the lower the profit. Some business owners red
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