Article on the technicals & techniques of buying and selling businesses.

1. PAGE 24 SUMMER 2012
Photo by Tin Nguyen
PAPERS, PLEASE: Greg Ellwood, owner of Sunbelt Business
Brokers of NOVA is an expert in sifting through the
financials to uncover what a business is really worth.
Featured Business
True value
Mum’s the word when selling a business
HIGH ENERGY: Paul Henry started with windows, but
everything his company does these days – decks, roofs,
siding and more — is meant to make a home more
energy efficient.

2. SUMMER 2012 PAGE 25
See ELLWOOD, Page 28

3. PAGE 28 SUMMER 2012
Photo by Photos.com
DUE DILIGENCE: Owners typically like to keep as much money as they can in their
business. It’s up to business brokers like Greg Ellwood to discover what the real numbers
are in terms of revenue and expenses.

4. SUMMER 2012 PAGE 29
How it works
When representing a seller, Greg Ellwood ―At that point,‖ Ellwood said, ―due diligence
has them sign an exclusive listing agreement, starts, when the buyer or the seller, whatever
generally for a year with renewals; it usually place you might be in, has access to every
takes six to eight months to sell a business. financial record that’s there.
He gets a $1,500 check up front, refundable ―There are typically 30 to 45 days where they
at the closing, and charges 10 percent of the go through the financials, seeing that they are
sales price for his services. getting what you say they’re getting.
―There are studies that have proven that you ―After that, we have a couple of transactional
typically get 15 to 17 percent more [selling lawyers that we work with. They set up the
with a broker] than you would on your own,‖ documents. Everybody views them and the
Ellwood said. transaction takes place. The lawyers handle
the transfer of money, and you have a new
―Our fees are 10 percent, but you are still up 5 owner.‖
or 7 percent, plus it’s a smoother transaction.‖
His final advice to the seller, Ellwood said, is
Returning to his example of selling a to keep the pedal to the metal.
newspaper, ―Let’s say John is interested in
buying your paper,‖ Ellwood said. ―Once you have made the decision to sell,
you’re hiring us to sell your business. Let us sell
―He would make an offer with a refundable your business, and you run it at 105 percent.
deposit, based upon contingencies. What are
those contingencies? ―If you take your foot off the pedal, everyone’s
going to realize it, everyone’s going to find out
―We’ve got to verify the revenues. Can he about it, and you are going to get far less
assume the lease? Will your editor-in-chief stay money at the table. Run it at 105 percent, and
for a couple of years or a period of time? let us do our job.‖