Archive for January, 2012

Buying a Small Business in 2012, Part Two

January 30, 2012

Continued from “Buying a Small Business in 2012, Part One”.

You’ve now identified a business opportunity and completed a tour of the business facility. The seller’s answered your initial questions and provided you with business financial information. Once you review the income statements, balance sheets and tax returns, you can decide if you want to make an offer. There are two ways to communicate the offer to purchase the business. You could choose to utilize a contract or binding agreement or you could utilize a Letter of Intent or non-binding agreement. A contract must be written by an attorney and immediately binds you and the seller, and will require submission of earnest money. You’ll include certain contingencies in the contract that must be satisfied and the contract’s highly definitive. (more…)

Woo Hoo! Something Realtors DON’T Have to Be Responsible For!

January 23, 2012

My heart goes out to the good folks in the mortgage business these days. Business is TOUGH! 

A significant percentage of buyers come equipped with enough bad credit baggage to fill a truck, what with having done a recent short sale or having a recent foreclosure or deed in lieu of foreclosure (same as a regular foreclosure, but it sounds nicer) or strategic foreclosure (a purposeful decision to walk away from a debt they CAN pay but don’t WANT to pay – don’t get me started on these).   

Combine that with the over-reaction of underwriters making it nearly impossible to qualify for a loan if the buyer has to put gas in the SUV on the way to the closing (“Oops, sorry, that gas charge 15 minutes ago just bumped your debt ratio out of whack”) or if part of the buyer’s down payment is the gift money received from Grandma for graduation and Grandma made the money having a garage sale or the buyer’s publicly traded employer has recently filed a negative outlook report with Wall Street or any number of other scenarios. 

Add in the burden of complex Good Faith Estimates which have to be redone every time anyone sneezes and you have a frustrating mix. (more…)

Buying a Small Business in 2012, Part 1

January 17, 2012

You may be wondering if 2012 will be a good year to purchase a small business. Can small businesses generate profit in a difficult economy? These are fair concerns and certainly require the small business buyer to move forward with adequate caution. If you’re determined to own a business, you can find what you’re looking for by establishing specific search parameters and purchase criteria. 

1. Research Well Performing Businesses

First, complete the necessary research to identify a short list of business types that perform well in a weak economy. Determine if franchise opportunities provide a greater chance of success. Franchises historically have a higher start-up success rate and give you a proven business system, training and name recognition. You’ll have to decide if you want to start a business from the ground up or purchase an established business. The established business will cost more however, you get to avoid the painful start-up period and you can see current and past performance. (more…)

Succeed in 2012 by Setting Realistic Expectations

January 9, 2012

When entering the New Year, it’s common to set goals for yourself. In real estate, those goals are translated into more clients, more listings and, most importantly, more closings. Just remember to not go overboard.

Sometimes, I hear agents say that their goal is 50 or even 100 transactions. Even a team of agents would have trouble meeting these numbers, and I hear this from a single real estate agent. If that wasn’t bad enough, they only completed 10 transactions the prior year.

Setting lofty goals is a good practice, but it’s also important to set goals that can be reached. When your ambition is too high, it can begin to look daunting and unattainable, which could end up setting you back.

Here are some realistic goals that will help you get on the right track in 2012: (more…)