Facts About Business Buyers
Over 90% of the people who buy businesses through the services of a business broker, in surveys taken annually for decades, acquire businesses that are engaged in industries that are different than the buyer’s previous professional experience.
Over 90% of business buyers buy something different than they were originally interested in acquiring (annual surveys).
Over 90 % of all business buyers are first time business buyers, who have not owned a business previously.
It is not uncommon for the “Return On Investment” (ROI) for the buyer of a business bought through the services of ABMI to be much higher than the ROI on investments in publicly traded stocks, bonds, mutual funds, CD’s, rental real estate, savings accounts or other investments, with the ROI on a business acquisition commonly being 25% to 200% or more annually on the down payment dollars invested by the buyer, since most of the ABMI arranged acquisitions are on businesses that are likely to “buy themselves out of their own cash flow”.
Business buyers commonly invest 20% to 25% of the total purchase price involved in acquiring a business, with lending institutions providing the other 75% to 80% of the funds needed.
In some cases, seller financing is also used to finance some of the acquisition.
On small business acquisitions, sellers seldom can finance the majority of the purchase for the buyer, as the seller needs to have enough proceeds from the sale for the seller to deliver the business assets debt-free to the buyer, and the seller almost always will want some “walk away” money, as well.
Financing for buyers thankfully is available from lending institutions, with/or/without an SBA guarantee. In the almost 30 years ABMI has been brokering the sale of businesses of all kinds, all sizes, all prices, we have been able to assist buyers in finding the financing needed to “make the deal”, in good times, or not so good times. This “Financing Discovery System” is provided to buyers at no extra charge by ABMI..
ABMI has brokered thousands of different businesses of all kinds and sizes, all prices, during our almost 30 years of providing top quality, low risk services to business buyers and sellers.
Why Some Buyers Buy A Business
According to Money Magazine, October 2010, the number of employers who offer employees a traditional pension plan:
Because traditional pension plans are being offered less and less by employers, some people come to the realization that they need to provide their own security for the future, and for millions of Americans that means purchasing their own business, so that they may have a chance to not only generate regular salary from the business, but also build equity value so that, some day, they may be able to sell the business, and thereby provide themselves and their family with financial benefits that a job doesn't provide.
Business Buyer Services
Business Buyers are our customers. Buyers typically contact ABMI, searching for low risk businesses to purchase. ABMI charges no fees to business buyers on most small business acquisitions transactions, and is paid a commission by the business owner/seller when the business sells, except for special projects at the buyer's request, when ABMI might be asked to represent a buyer in a transaction.
ABMI works with all buyers to help them not only find their “ideal deal” acquisition, but, when found, we volunteer to help Buyers arrange the acquisition financing (at no extra cost to the buyer/borrower). ABMI has helped thousands of business buyers arrange financing, on hundreds of millions of dollars of acquisitions, of all sizes, all prices, over the almost 30 years we've been brokering businesses of all kinds/types.
And, ABMI works with the buyer's lawyer, accountant and other advisors to assist in a smooth, “clean”, low risk conveyance of the business assets.
ABMI has specialized in helping business buyers in the Midwestern USA for almost 30 years. So, if you are a buyer, and are curious about how to buy a Kansas City business, or a Missouri business, or a Kansas business, we can help.
ABMI also accepts special consulting engagements by business buyers whereby ABMI receives a retainer for it's search/acquisitions services, against a commission when the business is purchased. However, most small business acquisitions engagements with business buyers are on a no-fee basis for the buyer.
Accomplishing The Business Buyer's Goals
We begin the buyer's search by consulting with the buyer about their “ideal investment”, helping the Buyer identify not only the kind of business they are likely to buy, but also the size business they can afford, and which investment would likely deliver the financial and career goals of the buyer and his/her family, and, just as important, we share with the buyer the “realities of the marketplace” about how businesses are priced/evaluated, and we invest the energy needed to help the buyer achieve the Return On Investment and Equity Build Up goals of the buyer.
The search process includes showing the buyer the many businesses for sale that ABMI presently has listed, and includes surveying our Associates for information on listings they are in the process of bringing to market at any given time.
ABMI agents, consultants and advisors specialize in patient, professional services to business buyers, including working with the buyers' accountant and attorney to insure that all buyers receive adequate advice during their acquisition journey.
Free Financing Assistance Is Our Specialty
ABMI specializes in providing assistance in arranging the financing needed to make acquisitions possible. Over 80% of the thousands of transactions we've brokered since 1982 have been completed with financing arranged by ABMI associates. These free financing assistance services include:
- ABMI provides acquisition financing advice and services at no extra charge to the buyer and seller.
- ABMI creates and produces the complete preliminary Loan Request Packet that’s used to show lenders the merits of the project.
- ABMI canvasses lenders in our extensive Lender Data Base, and makes the initial contact with the lenders on behalf of the buyer and seller, to discover lenders who would be interested in financing the project.
- ABMI delivers the preliminary Loan Request Packet to each interested lender.
- ABMI follows up with each lender.
- ABMI introduces the buyer/borrower to interested lender(s).
- After the buyer chooses a lender, ABMI assists the buyer and seller with the completion of loan documents needed, including the filling out of SBA or other government loan applications and other documents, when applicable, and the assembling and organizing of any supporting docmentation required by the lender.
Evaluations Performed By ABMI For Business Buyers:
Some buyers contact ABMI for an opinion of the merits of an acquisition the buyer is considering, prior to the buyer going "beyond the point of no return". These are usually acquisitions that the buyer discovered apart from ABMI's efforts (such as acquisitions the buyer may be considering that were found using some other business brokerage). ABMI offers this service to buyers, so buyers can confirm "the realities of the marketplace", and so buyers can confirm that the acquisition they're considering is, in fact, priced within generally accepted rules of thumb pricing and terms.
Evaluations Performed By ABMI for Buyers, Prior To The Buyer's Identifying The Buyer's "Ideal Deal":
Many prospective business buyers contact ABMI for advice, prior to the buyer choosing a business, and prior to the buyer deciding what business might be "just right" for them to acquire. ABMI offers this "pre-selection" service to help buyers understand the various elements included in a business acquisition, including financing options, SBA details, information on how to choose a business to buy, how to find a business once a buyer identifies the "type" or size of business, options available to the buyer in the terms sellers might offer the buyer, how to conduct thorough and low risk due diligence in acquiring a business, etc. This service is offered to buyers by appointment, at no charge to the buyer.
To arrange a no cost, no obligation consultation to discuss any aspect of buying a business of your own, please register with this web site and we will contact you.