A large-scale baby boomer exit will make for a buyer's market for businesses over the next several years.
THE KIPLINGER LETTER
Expect a glut of firms to go up for sale as thousands of baby boomers retire. With about 8,000 Americans turning 60 every day, more and more business owners are thinking about retiring. By 2009, an estimated 750,000 companies owned by boomers -- one in every six -- will be looking for buyers, up fifteen-fold from 2001.
Most firms will sell to strangers. Children today feel less pressure to run the family business, and even those that want to often find it tough to come up with the cash to pay off parents or other relatives who hold shares in the firm. Family in-fighting and prolonged legal spats also make family handoffs that much harder. Studies show that less than 15% of family businesses successfully make it down the third generation.
Owners without an exit strategy will likely sell at a discount, warns John Brown, founder of Business Enterprise Institute. With roughly 20 million more people in the boomer generation than the X Generation, there will be fewer potential buyers, so a good price will be harder to find. That's what makes advance thinking so important. "Gigantic amounts of wealth are not going to be realized because of a lack of planning," says John Hrastar, president of InterSource, a consulting firm.
Expert advice is a must. Owners need to consult a battery of advisers, from attorneys to accountants to appraisers, at least a year or so ahead of any expected sale. Potential buyers, including rival businesses, private equity firms and venture capitalists, all have sophisticated experts on their side and owners will need to be able to keep up. An exit planning team will do everything from entertaining bids from potential suitors to making sure the sale is tax-advantageous to spotting and correcting hidden liabilities that could torpedo a sale.
One option that's growing more popular is selling to employees -- either a management buyout or employee stock ownership plan (ESOP). Both take time to set up but give owners the fulfillment that they're passing on their legacy. In management buyouts, owners must weed out ill-suited managers and groom and train the best personnel so the firm will succeed without them. In these cases, management will often buy into the business over a number of years.
An ESOP tends to be a good route for firms with stable earnings and revenue. But the plan gets way too costly for small firms -- those under $1 million in yearly pre-tax profit -- due to associated upkeep costs like annual appraisals.
By Matthew Mogul, Associate Editor, The Kiplinger Letter
Monday, February 4, 2008
Monday, January 21, 2008
Master Your Traits and You will Master Yourself
Several years ago, I attended a business development conference and the key note speaker was Bob Burg. Mr. Burg’s presentation was so inspirational, powerful, and had such a positive impact on my life -- I have lived by a continually-improving revision of his original copy.
Bob Burg began his presentation with a poem entitled; “I’m Called Habits” which he keeps taped to the door of his office. It reads as follows:
----------------------------------
“I’m Called Habits”
I am your constant companion.I’m your greatest helper, or your greatest burden.I will push you onward, or drag you down to failure.I’m at your command.
Half of the tasks that you do,you might as just well turn over to me andI’ll do them quickly and correctly.
I’m easily managed.You must merely be firm with me.Show me exactly how you want something doneAnd after a few lessons, I’ll do it automatically.
I am the servant of all great people and, Alas, of all failures as well.Those who are great, I have made great.And those who are failures, I have made failures.
I am not a machine but I work with all the Precision of a machine plus the intelligence of a person.You may run me for profit or run me for ruin,It makes no difference to me.Just take me, train me, be firm with me and I’ll lay at your feet.But you be easy with me and I’ll destroy you.
Who am I?
Of course, you and I both know the answer is “our habits.”
The only line in the poem with which I might disagree is where it reads, “I am the servant of all great people and, alas, of all failures as well.” While I agree that habits are the servant of all great people, I believe that habits are the “master” of the failures. That’s because, unless you master your habits, your habits will master you. Sort of like money, which makes a wonderful servant but an evil master. It all depends upon whether you control them …or they control you.
----------------------------------
“Accounting for Character Traits”By Chad Byers
Week/Trait #1 Definiteness of Purpose
Successful people are dreamers and they dream big dreams. Their success starts with a vision that is too exciting to remain a dream. Successful people know what they want, and have a burning desire to possess it. They are laser-focused on the achievement of their goals.
Week/Trait #2 The two C’s: Courage & Confidence
To grow, you must face painful issues, conquer your fears, and confront adversity head-on. Moving forward at any pace when you’re dealing with the unknown takes courage, so apply it in everything you do. Even though you don’t know what you are doing, act as if you do. To be successful in selling to the world, you must have confidence in your ability and be tough enough to follow through.
Week/Trait #3 Enthusiasm
Successful people are extremely enthusiastic about what they do. In fact, this passion is what drives them to do what they do. Achievement toward their Definiteness of Purpose feeds the enthusiasm even more. Not only will passion drive you, but your enthusiasm will have a positive effect on others,as well.
Week/Trait #4 Persistence
Everyone meets adversity, hardship, and opposition. Successful people use these setbacks as stepping stones, rather than stumbling blocks, to propel them forward. Recognize that defeat is temporary, and that persistence will overcome adversity. Often, it is just when you are about to throw in the towel that your biggest client lands at your doorstep.
Week/Trait #5 Comparison
Successful people never compare themselves to others. They only compare themselves to what they were the day before. You should be better than you were the day before, everyday. You can only go two directions in life, either up or down. Be better at everything you do, everyday.
Week/Trait #6 Discipline
Successful people are organized, detail-oriented, and self-starters. When you are carving out your own path, you cannot expect round-the-clock guidance, so do not rely on anyone except yourself. Creating disciplined business processes, as well as having clear goals and objectives are vital to track and understand eventual success.
Week/Trait #7 Integrity
With all of the scandals that have rocked American businesses in the past several years, Integrity is imperative. If you say you are going to do something do it. Do what you say and say what you do.
Week/Trait #8 Quickness
Successful people do not waste time. Work smart, not hard. Do all you need (or have) to do without wasting time (procrastinating) and with maximum productivity per moment. Cut off all unnecessary actions. Focus.
Week/Trait #9 Order/Cleanliness
Successful people keep all living and working environments both clean and in order. Be organized. Clean, file, straighten up as soon as necessary and right away. A place for everything and everything in its place.
Week/Trait #10 Thrifty/Frugality
Use money wisely and for the benefit of all (to do good for others and myself) and with no waste. Successful people have sound personal financial plans. They understand their situation and manage their position through the achievement of their objectives.
Week/Trait #11 Tranquility, Peace, Patience, Lesson.
Interpret everything quietly without undue confusion, excitement, or anger. Be not disturbed at trifles or at accidents common or unavoidable. Whatever is happening in life, be patient. Determine the lesson to be learned in every challenge in order to become elevated. Control Anger.
Week/Trait #12 Positive Mental Attitude (P.M.A.)
Successful people do not waste their time on negative thinking. Take the constructive approach – see what your options and resources are and make use of them – this will always get you somewhere. You must always be optimistic about what you are pursuing. Negativity only pollutes your life with bad experiences.
Week/Trait #13 Trust
Once you establish trust with your clients – which is hard to gain and easy to lose – keep it, maintain it, and guard it. Trust is your gateway to doing business. Selling to the world does not happen overnight. It is a slow process that takes a lot of thought, discipline, and lots of hard work. Entrepreneurs have always been known to combine a vision of the seemingly impossible with a plan to make it happen.
----------------------------------
After you've confirmed that these are the traits that you need to work on. Work on one trait all week long. At the end of every day, give yourself a grade from 1 - 10 on how well you did on achieving the ultimate-success of that trait. At the end of the week, add up your total score and keep it for your records. With 13 specific traits and 52 weeks in a year, this will now become your perfect opportunity to work on your 13 worst traits, 4 weeks per year.
Cheers to being better every day and thank you Bob Burg!
www.Burg.com
Bob Burg began his presentation with a poem entitled; “I’m Called Habits” which he keeps taped to the door of his office. It reads as follows:
----------------------------------
“I’m Called Habits”
I am your constant companion.I’m your greatest helper, or your greatest burden.I will push you onward, or drag you down to failure.I’m at your command.
Half of the tasks that you do,you might as just well turn over to me andI’ll do them quickly and correctly.
I’m easily managed.You must merely be firm with me.Show me exactly how you want something doneAnd after a few lessons, I’ll do it automatically.
I am the servant of all great people and, Alas, of all failures as well.Those who are great, I have made great.And those who are failures, I have made failures.
I am not a machine but I work with all the Precision of a machine plus the intelligence of a person.You may run me for profit or run me for ruin,It makes no difference to me.Just take me, train me, be firm with me and I’ll lay at your feet.But you be easy with me and I’ll destroy you.
Who am I?
Of course, you and I both know the answer is “our habits.”
The only line in the poem with which I might disagree is where it reads, “I am the servant of all great people and, alas, of all failures as well.” While I agree that habits are the servant of all great people, I believe that habits are the “master” of the failures. That’s because, unless you master your habits, your habits will master you. Sort of like money, which makes a wonderful servant but an evil master. It all depends upon whether you control them …or they control you.
----------------------------------
“Accounting for Character Traits”By Chad Byers
Week/Trait #1 Definiteness of Purpose
Successful people are dreamers and they dream big dreams. Their success starts with a vision that is too exciting to remain a dream. Successful people know what they want, and have a burning desire to possess it. They are laser-focused on the achievement of their goals.
Week/Trait #2 The two C’s: Courage & Confidence
To grow, you must face painful issues, conquer your fears, and confront adversity head-on. Moving forward at any pace when you’re dealing with the unknown takes courage, so apply it in everything you do. Even though you don’t know what you are doing, act as if you do. To be successful in selling to the world, you must have confidence in your ability and be tough enough to follow through.
Week/Trait #3 Enthusiasm
Successful people are extremely enthusiastic about what they do. In fact, this passion is what drives them to do what they do. Achievement toward their Definiteness of Purpose feeds the enthusiasm even more. Not only will passion drive you, but your enthusiasm will have a positive effect on others,as well.
Week/Trait #4 Persistence
Everyone meets adversity, hardship, and opposition. Successful people use these setbacks as stepping stones, rather than stumbling blocks, to propel them forward. Recognize that defeat is temporary, and that persistence will overcome adversity. Often, it is just when you are about to throw in the towel that your biggest client lands at your doorstep.
Week/Trait #5 Comparison
Successful people never compare themselves to others. They only compare themselves to what they were the day before. You should be better than you were the day before, everyday. You can only go two directions in life, either up or down. Be better at everything you do, everyday.
Week/Trait #6 Discipline
Successful people are organized, detail-oriented, and self-starters. When you are carving out your own path, you cannot expect round-the-clock guidance, so do not rely on anyone except yourself. Creating disciplined business processes, as well as having clear goals and objectives are vital to track and understand eventual success.
Week/Trait #7 Integrity
With all of the scandals that have rocked American businesses in the past several years, Integrity is imperative. If you say you are going to do something do it. Do what you say and say what you do.
Week/Trait #8 Quickness
Successful people do not waste time. Work smart, not hard. Do all you need (or have) to do without wasting time (procrastinating) and with maximum productivity per moment. Cut off all unnecessary actions. Focus.
Week/Trait #9 Order/Cleanliness
Successful people keep all living and working environments both clean and in order. Be organized. Clean, file, straighten up as soon as necessary and right away. A place for everything and everything in its place.
Week/Trait #10 Thrifty/Frugality
Use money wisely and for the benefit of all (to do good for others and myself) and with no waste. Successful people have sound personal financial plans. They understand their situation and manage their position through the achievement of their objectives.
Week/Trait #11 Tranquility, Peace, Patience, Lesson.
Interpret everything quietly without undue confusion, excitement, or anger. Be not disturbed at trifles or at accidents common or unavoidable. Whatever is happening in life, be patient. Determine the lesson to be learned in every challenge in order to become elevated. Control Anger.
Week/Trait #12 Positive Mental Attitude (P.M.A.)
Successful people do not waste their time on negative thinking. Take the constructive approach – see what your options and resources are and make use of them – this will always get you somewhere. You must always be optimistic about what you are pursuing. Negativity only pollutes your life with bad experiences.
Week/Trait #13 Trust
Once you establish trust with your clients – which is hard to gain and easy to lose – keep it, maintain it, and guard it. Trust is your gateway to doing business. Selling to the world does not happen overnight. It is a slow process that takes a lot of thought, discipline, and lots of hard work. Entrepreneurs have always been known to combine a vision of the seemingly impossible with a plan to make it happen.
----------------------------------
After you've confirmed that these are the traits that you need to work on. Work on one trait all week long. At the end of every day, give yourself a grade from 1 - 10 on how well you did on achieving the ultimate-success of that trait. At the end of the week, add up your total score and keep it for your records. With 13 specific traits and 52 weeks in a year, this will now become your perfect opportunity to work on your 13 worst traits, 4 weeks per year.
Cheers to being better every day and thank you Bob Burg!
www.Burg.com
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