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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.

The BBF has given sellers and their brokers an amazing marketplace to sell businesses. It has proved to be quite efficient in its ability to find the right buyer to buy businesses that enter the marketplace. And in today’s seller-favored landscape of business transactions, if a business is not selling, we can only deduce that it is overpriced. This issue is obvious, and the statistics show clearly that these businesses most likely will not sell. In this article, we will delve into some key reasons as to why overpriced businesses struggle to sell.

Educated Buyers: Modern consumers are more informed than ever before, thanks to the wealth of information available at their fingertips. Buyers conduct thorough research, understanding market trends, financial standings, and comparable sales. An overpriced business stands out like a sore thumb to educated buyers who can quickly identify discrepancies between the asking price and the actual value. Informed buyers are less likely to “make an offer,” leading to a prolonged listing period or, in some cases, no sale at all.

Comparative Shopping on the Internet: The internet has revolutionized the way people shop, and this holds true for business acquisitions as well. Potential buyers can effortlessly compare prices, features, and the overall value of businesses in the same industry or niche. A business that is perceived as overpriced online will struggle to attract serious inquiries, as buyers can easily find alternatives with better value propositions. The transparency provided by the internet has made it imperative for sellers to understand the marketplace and price accordingly.

Aversion to Negotiation: Negotiating the sale of a business can be a delicate dance, and some buyers are averse to the process altogether. When a business is overpriced, negotiations become more challenging, and potential buyers may be discouraged from engaging in the conversation. Buyers prefer transparent and fair pricing. Therefore, an overpriced business may create an atmosphere of distrust, hindering the negotiation process and causing the process to never even start. This may also be a generational trend worth consideration.

Fear of Offending Sellers: Buyers often tread carefully during the negotiation process, fearing that expressing concerns about the pricing may offend the sellers. This reluctance to discuss perceived overpricing can lead to a breakdown in communication and a failure to reach a mutually agreeable deal. Sellers who are open to constructive feedback and are willing to adjust their pricing strategy are more likely to engage in successful negotiations and ultimately close the deal.

Perception of Unreasonableness: The perception of a seller as being unreasonable or even delusional can stem from an overpriced listing. If a business is priced significantly higher than its market value, potential buyers may view the seller as unrealistic or out of touch with market realities. This perception can drive away serious buyers who are looking for fair and justifiable pricing. It may also call into question the seller’s representations of other items in the opportunity such as earnings claims.

Drop in Sales: The Evidence is Clear: Statistics indicate a clear correlation between overpricing and a failure to sell. When a business is priced more than 15% above its market value, the chances of a successful sale decrease significantly. This underscores the importance of accurately valuing a business, pricing it appropriately to attract potential buyers and facilitating a successful transaction process.

In conclusion, the primary reason businesses fail to sell is that they are overpriced. Educated buyers, the power of the internet, aversion to negotiation, fear of offending sellers, and the perception of unreasonableness are all factors that contribute to this dilemma. Again, buyers will not “just make an offer.” Brokers must help their sellers carefully consider market dynamics, give them professional advice, so they adopt a realistic pricing strategy in order to maximize their chances of a successful business sale in today’s marketplace. Simply stated, if you are trying to sell a business, and have yet to, your business is most likely overpriced.