Business Broker: More buyers than sellers

by Nancy Hogland

Lake area business broker Alysia Maschino finds herself in an unusual predicament. She currently has many more buyers than sellers.

“I never expected this to happen, especially in this economy, but because of all the corporate downsizing, there are many people who have received large severance packages or incentives for taking early retirement, they’ve decided they’re tired of working for someone else and they want to own their own business,” she explained. “In fact, a recent contact had a seven-figure amount of cash to invest. He likes the Lake area and wants to move here. Problem is – I now have to find a business for him to buy!”

Maschino said she’s been busy sending letters to the owners of the types of businesses her client is seeking, asking if they’d ever considered selling – something she knows will pay off.

“There are a lot of people who want to sell but don’t know how to go about it. They don’t want to list their property because they fear it could hurt their business but they don’t know what else to do. That’s where I come in,” she said. “I can provide confidentiality, which is one of the greatest benefits of using a business broker.”

Maschino said if an owner hasn’t been treating his or her customers right, the public finding out that the business could be changing hands might be a good thing. However, for most people, it isn’t.

“Customers – even ‘regular’ customers – can get wary about using a business they know is for sale. They wonder if the business will survive or if business practices or prices will change once the new owner comes in so they start looking for another option. In addition, employees get nervous wondering if they’ll have a job under the new ownership so they start looking around. Before you know it, the bottom line is affected, and unfortunately, that also affects the selling price and how much a buyer can borrow. It’s kind of a snowball effect and it gets worse the longer it goes downhill,” she said, adding that by using a business broker, those problems can all be avoided. “Buyers are even required to sign a confidentiality agreement before any information – including the name of the business – is released to them so no one has to find out. Sometimes people never find out that there’s a new person running things.”

A secondary benefit is that the seller isn’t tied up explaining why he or she is selling to every customer that walks thru the door.

Maschino, who previously worked as a loan originator, said because of the research she does on the businesses she markets, there are also benefits to the buyer.

“Before I even accept a business, I typically meet with the owners three times. I want to get to know them and their business and I want them to get to know me. I provide a packet with every document that will be used during the process and I also study the company’s books for the previous three years to evaluate the worth,” she explained. “That helps the seller, who usually doesn’t have a clue on what to ask for the business, but it also helps the buyers because I can help them determine the chances of getting financing.”

Maschino said she originally looked into becoming a business broker because she thought she could help her parents sell their establishment if and when that time comes.

“They have owned a business for 35 years and thought if I could handle it, I might be able to save them money so I started exploring my options,” she said, adding that after coming across the website of a brokerage training firm, she thought it sounded promising but couldn’t afford the tuition or the time away from work to attend school. She added it to her list of “favorites” and then quickly forgot all about it.

When the real estate industry began to plummet and loans became harder to close, Maschino decided it was time to search other avenues.

“I poked around thru my list of bookmarked sites and came across that firm. When I clicked on the page I saw that they had begun a pilot program that was ‘do-able’,” Maschino said. “Next, I spent quite a bit of time researching them on the internet and couldn’t find one negative comment about the program. I’m a firm believer that when one door closes, another is opened and this just felt right so I enrolled.”

She said she knows she made the right decision because business brokering has been booming.

“Now I just have to find sellers,” she laughed, adding, “That’s a good thing – better than having it the other way around!”

For more information visit www.masbusiness.biz or call Maschino at 573-836-1258.