In order to gain favorable attention and create openings as we call on new prospects and existing clients to expand business, we find it vital to discover the meaningful outcomes that have been attained through the eyes of existing, satisfied customer relationships. To support preparation for this activity, start by contacting (ideally by phone, or face to face) the five best customers you feel are well satisfied in doing business with ________________________________

1.  The goal is to ask for feedback by way of responses to the questions below and write down as much word for word what is said, rather than summarizing.

2.  Do this with people in various levels of responsibility.

3.  This feedback is vital in crafting language that allows us to initially impact what other customers and potential prospects hear. Each of these questions is meant to be a starter question. We want to dig into initial responses as they describe the impact in their business. Each question is designed to focus on their results, not just what they say about us. You may want to write responses on the back of this sheet.

4.  DO NOT SEND THIS TO CLIENTS AND ASK THEM TO COMPLETE IT! It will take away any follow up questions.

​5.  As you accumulate responses, you will see patterns to incorporate into your approach to others. It will broaden your results, allow you to speak much more from client and prospects viewpoint, and impact the number of people with whom meaningful business conversations are possible.
•    Make 5 blank copies to start, and then continue doing with each person you have contact.
•    Put the customer’s name and position title on each sheet.
•    In contacting, ask customers if they would be open to giving some
“feedback” about their business relationship with our firm. 

Typical Situation: Our client needs funding to pay bills on time. They have orders coming in, but are not getting paid on time or “in time” to pay bills. They could also be getting a large order, that may require up front funding to vendors.

When you hear a business owner say:
·        “My cash flow is poor”
·        “I’ve got good customers but they’re paying my invoices slow/beyond terms”
·        “I received a large order but can’t pay my supplier/s”
·        “I’m too new to get bank financing”
·        “My bank won’t provide enough financing to meet my company’s needs.”
 
An Accounts Receivable Consultant provide strategic financing solutions for business to business companies.  Strategies include accounts receivable financing as well as purchase order financing, work-in-process financing and asset based loans.

How they Work The Consultant visits our client and conducts a comprehensive analysis of the client’s situation as to the history of the business, opportunities and challenges, current financial condition and current financing, if any, as well as their financing needs.

Matching Ideas with Resources:

Well, it that that time of year again. Time for some business planning for 2021. I am guessing there are not too many business owners who planned the 2020 pandemic in their business plan. But at least they had a business plan. Here is an outline of a business plan you can use. If you have some trouble, you can ask Tom Gosche, Business Strategist from GLM! tomg@goglm.com and/or 630-675-8971

1. Executive Summary

2. Current Situation

3. Vision

• Mission Statement
• Goals (long range)
• Objectives (short/medium range)

4. Management

5. Product / Service Description

6. Market Analysis

• Customers
• Competition
• Opportunities
• Risks

7. Marketing Strategy

• Personnel
• Facilities / Equipment
• Pricing & Profitability
• Advertising & Promotion
• Public Relations
• Selling Tactics
• Distribution Channels
• Business Relationships

8. Production / Manufacturing Strategy

• Personnel
• Facilities / Equipment
• Intellectual Property
• Regulation / Compliance
• Supply Chain
• Business Relationships

9. Administrative Strategy

• Personnel
• Facilities / Equipment
• Management Information
• Worker Administration & Benefits
• Regulation / Compliance
• Business/Professional Relationships

​10. Financial Information 

• Pro Forma Balance Sheets (for 5 years into the future)
• Pro Forma Income Statement (for 5 years into the future)
• Detailed Budget (for next 12 to 24 months into the future)
• Cash Flow Projection (for next 12 to 24 months into the future)
• Break Even Analysis (show growth steps, if applicable)
• Summary of Existing Resources (people and money)
• Potential Sources of Funding

MOTIVATION TO SELL

• Is it a motivated seller and why?
• How much debt does he need to pay off? (mortgages loans?)
• How much cash does the seller immediately need?
• Does he need that cash all at once?
• Is he looking for a way to avoid capital gains? Or reduce or spread out his tax liability?
• Are there other family members involved in the decision making process?
• Has the reputation of the company been damaged at all?
• How dependent has the business been on the current owner? Relationships with employees? Customers? Vendors?

 
STRATEGIES TO CONSIDER WHEN BUYING A BUSINESS

• Consider buying on installment
• Don't ever be shy in asking for information- your strategy is to "discover" as much as you can
• Consider holding back some of the purchase price until after closing- say six months or a year in case you suffer a loss due to the owner failing to "disclose" information
• Consider buying land in one deal and the company in another- if the two are indeed owned separately
• Consider and 'earn-out' provision where seller only gets paid if certain financial milestones are met

MARKET PERCEPTION
What is it? With Customers and Vendors?

• What is its brand position? Is it healthy?
• Do they have a good reputation?
• Do they have a customer database?
• Do they have a prospect database?
• Do they know how large their market is?
• Do they have a CRM?
• How are they perceived in the marketplace?
• Who are their key partners and alliances?
• Are their prices high? Low? Middle?
• Are their competitors who are larger, cheaper, quicker, faster that have the customer's attention?
• What are the barriers to entry to this business?
• Does the business have significant vendors or customers?
• Any vendors that we use that we purchase 10% or more of our product from?
• Any customers that make up 5% or more of revenues/sales?

Featured in the Daily Herald Business Section
This Series is being featured in the Daily Herald. Please enjoy Jim Kendall's Column:​
http://www.dailyherald.com/business/20171022/what-to-ask-before-buying-a-business ​

​

​LEGAL
What are you buying? If it is a stock purchase is it a C Corp?  S Corp? LLC?

• Is the business in good standing with the state and feds? ​
• Any pending lawsuits? Governmental proceedings?
• ​Survey on land
• Any independent contractors that should have been classified as "employees"
• what is the property zoned?
• Can any of it be sub-divided at a later date and sold off?
• Does the owner really own it? Do they have the legal authority to sell?
• Any workman comp claims? Unemployment claims? -any patents or copyrights of logos?
• Any business license and are the transferrable?
• Any tax registration certificates? Are they transferrable?
• Is the business in compliance with zoning laws?
• Any toxic waste or environmental problems
• Do they own photos, testimonials that may be used in print collaterals or the website?
• Any employee contracts with non-competes?

​Matching Ideas with Resources:
We have referrals available for Attorneys specializing in buying businesses.

​ASSETS

• What assets are you buying?
• Any intellectual property? (trademarks, trade secrets)
• Any inventory or goods obsolete? What is their value?

​FINANCIAL QUESTIONS

• Cash Flow Statements
• Balance Sheets
• Accounts Payables And Receivables
• Benefit Contracts
• Insurance/Pension/401 K
• Outstanding Debts
• Debt Review
• Ucc-A Forms - To Find Out Who Extended Credit To The Company -What Secured Assets Were Tied Up In Previous Loans
• Do They Have Healthy Margins?
• How Do Their Customers Pay For Their Products?
• Are Their Expenses In Line With Their Revenues?
• Where Will Your Down Payment Come From?
• What Sources Of Financing Do You Have? (Friends, Family,)
• What Sources Of Funding Do You Have (Self-Directed Funds From Retirement Accounts, Stocks, Home Equity)?
• Is The Seller Open To Seller Financing?
• Is The Seller Open To "Run To Own”?
• Can You Furnish A Statement Of Personal Net Worth And Resume?
• What are the terms of renting the building/land if you are not buying?