Author: Sasa

How many times have you worked to put together a well design CIM only to have buyers ask questions that you already answered. If this is a common occurrence you are not alone.

Buyers will often just skip right to the financial information and read no more. It’s a frustrating experience when you are asked the questions you carefully took the time to answer.

There are many reasons why a buyer might not thoroughly read a Confidential Information Memorandum (CIM), despite your efforts to make it accessible and clear:

1. Overload of Information: Even a concise CIM can seem dense to buyers who are reviewing multiple opportunities. They might skim through details or skip sections they perceive as less important.

2. Familiarity with Industry: Buyers familiar with the industry may assume they know the basics and skip over sections they believe are standard or irrelevant to their decision-making process.

3. Urgency and Impatience: Some buyers are in a rush to make a deal and may prioritize speed over thoroughness. They might skim through the document, looking only for key figures or deal-breakers.

4. Lack of Experience: Inexperienced buyers might not understand the importance of all the details in the CIM, leading them to overlook critical information.

5. Digital Fatigue: In today’s digital age, reading detailed documents on screens can be tiring. Some might postpone reading, skim, or even avoid the document if it’s not engaging enough.

6. Format and Presentation: Even with visual aids, the way information is presented can affect readability and engagement. If the layout isn’t intuitive or if it appears cluttered, key points might be missed.

7. Selective Attention: Buyers may have specific criteria or deal-breakers in mind, leading them to focus on those aspects alone and ignore other potentially important information.

To mitigate these issues, keep CIMs concise, clear, and visually aided, here are ten strategies to make your Confidential Information Memorandums (CIMs) more engaging and effective:

1. Executive Summary: Start with a brief yet compelling executive summary that captures the key selling points and value propositions of the business. This should be brief (ideally one page) but powerful, enticing the reader to delve deeper into the document.

2. Infographics: Use infographics to represent data visually. Complex financials, growth metrics, and business processes can be simplified into digestible visuals that are quick to understand at a glance.

3. Keep Pablum to a minimum: We have all seen CIMs filled with pages and pages of generic babble. This is a big turn off to the buyer. If you include information, make sure it is specific and relevant to the listing at hand.

4. Video Overviews: Include a link to a short video where you or the business owner gives a brief overview of the business. These days people are more used to visual presentations of information. This personal touch can make the content more engaging and give a face to the business being presented.

5. Clear Headings and Logical Flow: Organize content with clear, descriptive headings and a logical flow that guides the reader through the document. This helps in making the document less daunting and more intuitive.

6. Highlight Key Points: Use call-out boxes or sidebars to highlight critical information, key statistics, or testimonials from clients or customers. This breaks up the text and draws attention to important data.

7. Professional Design: Consider investing in professional design services to ensure the CIM looks appealing and professional. A well-designed layout can significantly increase readability and engagement.

8. FAQ Section: Anticipate questions and include a FAQ section at the end of the CIM. This can address common inquiries and reinforce important information already covered in the document. This should be a fluid section. As questions are asked by buyers add the most common questions to your list.

9. Separate Financials: Instead of including financial details in your CIM put them in a separate spreadsheet. This will ensure that instead of focusing on financials, when you buyer turns to the CIM they will be more inclined to focus on content.

10. Regular Updates: Keep the CIM regularly updated to reflect the most current data and developments in the business. Include the latest date of revision as in “Updated June 2024”. This not only keeps the document relevant but lets the buyer know they are viewing the latest information.

These enhancements can make your CIM not only a source of vital information but also a persuasive tool in engaging potential buyers effectively.

It is hard to believe that we are coming up to the halfway mark for 2024. I hope everyone is having a busy and productive year.

We have been busy with BBF putting the final touches on our 2024 BBF Conference. “Rockin’ N Rollin’ in Business Brokerin” is our theme and I assure you there will be a rockin good time for all. I can remember back when I attended my first Business Brokerage Conference. Initially, I was overwhelmed, however the knowledge I gained was game changing to my career as a Business Broker. I also started developing relationships with other Business Brokers. These are the things that happen when the BBF Community comes together for a live meeting.

I encourage all the BBF Members to attend this year’s conference. There are workshops for all whether you are a brand-new Broker or have been in practice for many years. Registration notice was sent out last week, take advantage of the early bird rates.

Best regards,

Just when you think everything is going smoothly in a transaction, never say it out loud because you know what is coming next… Something to derail it will pop up. And, sure enough it did on one of our most recent SBA financing transactions that involved a business acquisition of a profitable well-established restaurant.

In June of 2023 we processed a loan request for a borrower who was purchasing an established restaurant on the west coast of Florida. This was the second attempt this borrower made to purchase a restaurant. The first one fell through during his due diligence that had nothing to do with his financing. So, the bank was familiar with this borrower, we liked him, he had solid industry experience, good personal credit and although some of his cash injection was coming from gifted funds, he had the funds to inject and still have some personal liquidity post-closing. All the attributes a lender could hope for.

So, when his second request came to us to purchase an even better restaurant than the first, it sailed through pre-qualification, term sheet, underwriting and into closing. No issues encountered. Our borrower was a model borrower and provided everything we needed for closing very promptly and we were sliding into closing by the end of July.

Now comes the not so smooth part! A week and a half before the scheduled closing the seller informed us that he just received notification that his company was chosen for a standard run of the mill state sales tax audit and, therefore, we were unable to obtain the Sales Tax Certification we needed to close. However, we had a cooperative seller who wanted to sell and we had a motivated borrower who still wanted to buy so an extension was provided to allow for what was supposed to be a quick process to complete and then we could obtain the certification and close. This was the last item of the outstanding closing documents needed.

Well, extension #1, then extension #2, then extension #3…. You get the idea. Each time the seller checked with the state he was told they would be getting to it but that they were horribly understaffed and could not give him a completion date or even when they would start on his file. So, here we go rolling into 2024 with a January 31, 2024, expiration date of the contract yet again and no resolution to the sales tax audit issue. However, this time, the seller determined that his 2023 was a killer year and his revenues and profitability were up over the previous years and demanded a new sales price of over $200,000 more than the originally agreed upon price. He was not going to extend past the January 31, 2024, date unless the borrower agreed to the higher purchase price. The seller was willing to wait for the audit to be completed and then put the restaurant on the market for a higher price. As you can imagine, the borrower who had spent money and not to mention spent all this time waiting and really wanted this restaurant was devastated.

After pleading with the seller and trying to push the state auditors (which we all know went nowhere), we jumped into action, obtained short term interim financing and on January 31st much to the seller’s dismay and disappointment, the borrower was able to close on the transaction and took possession of the restaurant. The bank converted our loan from business acquisition financing to a debt refinance and we closed. The sales tax certification issue was resolved because now the borrower owns the restaurant under a totally different operating company and sales tax ID number so a certification was obtained.

The other good news is that the updated valuation we had to obtain due the time passing came in $479,000 higher than the borrower’s purchase price due to the higher revenues and profitability in 2023. The borrower and the bank are happy.

We have already completed the first quarter of 2024. How time flies. From my communications with members, business seems to remain strong. Let’s keep pushing and make 2024 a monumental year.

As always, there’s a lot going on here at the BBF! Here are some key updates and reminders to help you take full advantage of everything your association is providing.

First, BBF’s Forms Committee has been busy and delivered to us 4 new updated forms ready to use now. These are an APA, Listing Agreement, NDA, and an NDA to be used with Private Equity Groups. The Forms Committee is also finalizing a new Stock Purchase Agreement which we should see in the very near future. Thank you to Ryan Cave for hosting a webinar on April 4th that reviewed the key updates to the APA and Listing Agreement – if you missed it, make sure to check out the recording on the Members Center (along with recordings of our other great educational webinars).

Our Conference Planning Committee is also in full swing planning our statewide Conference, August 23-25 at the beautiful Caribe Royale in Orlando. This is a great opportunity to sharpen your skills with workshops designed for all experience levels of business brokerage, from new brokers to the very seasoned broker. Plan to share in the high energy, camaraderie, and support of our great organization (and have a lot of fun too). We will have a great lineup of speakers and workshops, and this year our Affiliates can showcase their services at the Conference to help us get more deals done! Attendee registration opens in June, but here are some important planning links:

Affiliates, download the EXHIBITOR OPPORTUNITY GUIDE and sign up by April 19th to save. Sponsorships are also going fast so don’t delay!

Anyone interested in presenting a workshop should complete the WORKSHOP SUBMISSION FORM by April 30th. Help us build a great lineup of topics at the Conference!

Start making your plans now by reviewing the AGENDA AT A GLANCE and if necessary, BOOK YOUR HOTEL ROOM early in our block to get a great rate.

Lots more information to come on the Conference, but I’m already confident this will be our biggest and best yet.

This is also the time of year when we recognize the outstanding accomplishments of our Members with our State and District Awards. We have a record number of award recipients this year, and I would like to congratulate each member for their achievements in 2023. Winners will be announced shortly, and the Districts are lining up their awards banquets so be sure to attend. Let’s all work together to make 2024 another record-breaking year!

There’s lots more going on but these are just the highlights. As an association we are in the midst of an exciting time of growth and improvement. That’s why on the Conference Agenda we’re doing a Town Hall session on Sunday where we’ll go more in-depth on all the great initiatives and answer your questions along the way. On behalf of all BBF leadership we hope you will participate as it is YOU, our Members and Affiliates, that make the BBF great!

Best regards,

In late 2005, fresh from getting shown the door at my last “real job” I entered the world of business brokerage. Eager to get after working I hurried to attend training in the Old Transworld Office in Fort Lauderdale. I sat in class with Frank Feiler and listened intently to the wisdom imparted from the likes of Tom Jones, Peter Berg, and Andy Glasgow.

In addition to the wealth of wisdom shared from these folks, my class of 8 got introduced to the Business Brokerage Press and the man known as “The Old Pro” Russ Wright. Wrights lessons cover cold calls, servicing, down payments, and seller financing. I consumed it like a thirsty camel storing up for a long trek into the deserts of Arabia.

Well now some 18 years ago, I am considered by some an “Old Pro” so I want to add to the lessons. This time it will be on Communication:

Classic Channels, Modernized:

Mobile-First Messaging:

Visual Engagement Platforms:

Collaboration and Productivity Apps:

Emerging Technologies:

Choosing the Right Tools:

The best communication tools will depend on your individual preferences, clientele demographics, and the specific needs of each transaction. But unlike the world, “The Old Pro” wrote about how our world is changing by the minute. New tools and trends for communication emerge and evolve and you must evolve your communication tools as well and master them early. Experiment with different options, track their effectiveness, and tailor your communication strategy to optimize client engagement and satisfaction. Remember, effective communication goes beyond just choosing the right tool; it involves building rapport, being responsive, and tailoring your message to each individual client.

By mastering these diverse communication tools, business brokers can become true masters of connection, building lasting relationships and achieving success in the ever-evolving digital brokerage landscape.