Tumbleweeds, Beloved Community Resource, on the Market

Tumbleweeds, an early and mid-childhood development magazine loved by parents and educators, is now on the market. Long-time owner Claudette Sutton is ready to move onto her next projects after decades of growing the publication into a staple resource for northern New Mexico families.

Listed at $95,000 with a cash flow of $50,000, this home-based business allows for a flexible, part time schedule and engagement with a passionate, grateful community. The publication enjoys an established advertising base, strong distribution, and a dedicated team of writers, designers, and editors.

A recent article in Santa Fe New Mexican highlights community appreciation for the publication’s helpful content:

“Where would parents and teachers be without Tumbleweeds?” said Joani Kennedy, who has operated the Wee Spirit Preschool in Santa Fe since 1984. She’s been a Tumbleweeds reader since the beginning [in 1995].

“There are profound articles for teachers and people to solve the wonderful problems that come with working with children,” Kennedy added.

Tumbleweeds grew out of a four-page newsletter, Tot’s Hot News, that Sutton started in 1991 focusing on early childhood. By 1995, it had grown to 16 or 20 pages and was addressing increasingly older children. Sutton upgraded to a magazine format with Tumbleweeds.

“I was realizing a lot of articles were not just for parents of young children but children in elementary school and approaching teens,” she said.

 

4 Tips to Build Managerial Confidence

A lot of people know the symptoms: feeling overwhelmed, unworthy, overly lucky, terror at being “found out.” If you’ve wrestled with Impostor Syndrome, you know the struggle is real—even when your lack of qualifications isn’t!

Impostor Syndrome is a pervasive sense of self-doubt, a belief that one’s successes have not been earned. While this insecurity can strike at any level of professional experience, research indicates that it is more common when starting a new endeavor, such as managing a new business.

In a recent article on Fast Company, writer and senior strategist Jackie Berkery shares four tips tailored for new managers dealing with confidence issues.

Claim Your Success

“Take time to contemplate what’s been accomplished and the role you played,” Berkery suggests. Acknowledge what your team did well, but also what you, as their manager, did to facilitate and foster that success. “When you don’t have a concrete sense of how your individual behaviors generate certain outcomes,” she points out, “you can’t learn from either your failures or your successes—and, for the record, the latter is just as important as the former.”

Vulnerability in Moderation

“The benefits of vulnerability get sidelined when your team hears you doubt your own management skills,” says Berkery. “Most of the time, your team needs someone who can inspire confidence, display composure and consistency, and lead by example. While there’s still ample room for showing empathy, owning your mistakes, and developing an approachable, open management style, expressing doubt in your abilities as a manager is not an effective strategy.”

Get Specific Positive Feedback

Receiving and responding to constructive criticism is an important part of growth. Positive feedback is an important part of the learning process too! “Ask for two to three specific things you’ve done that have been helpful or had a positive impact,” Berkery suggests.

Embrace a Growth Mindset

It’s OK that you don’t know it all yet! “There will be a learning curve and skills you need to develop over time. It’s only natural you’ll second-guess yourself along the way,” says Berkery. “Recognizing your imperfections while putting in the work to improve isn’t the same as the paralyzing downward spiral of self-doubt triggered by Impostor Syndrome. If you don’t feel confident in your abilities right now, be confident in your ability to learn and grow and just plain work hard instead. Confidence as a manager and leader will come.”

In another article, we discuss the value of a training and transition phase as well. When you buy a business, this phase is a great learning opportunity. The seller, as well as veteran employees, will often help you settle in. Take this chance to learn as much as you can. You got this!

 

Business Buyers Can Leverage SBA Lending

Finding the money to start your own small business can be a challenge.  Over the decades, countless people have turned to the Small Business Administration (SBA) for help.  A recent Inc. Magazine article, “Kickstart Your Business Dreams with SBA Lending,” by BizBuySell President, Bob House, explored how SBA lending can be used to the buyer’s advantage.

The article covers the basics of an SBA loan and who should try to get one.  House notes that the SBA doesn’t provide loans itself, but instead facilitates lending and even micro-lending with a range of partners.  The loans are backed by the government, which means that lenders are more willing to offer a loan to an entrepreneur who might not typically qualify for one.  The fact is that the SBA will cover 75% of a lender’s loss if the loan goes into default.

Entrepreneurs can benefit tremendously from this program.  In some cases, an SBA loan even means skipping the need for collateral.  SBA loans can be used for those looking to open a business, expand their existing business or open a franchise.

House points out that getting an SBA loan has much in common with receiving other types of loans.  For example, it is necessary to be “bank ready.”  By “bank ready,” House means that all of your financial documentation should be organized, clear to understand and ready to go.

Next, a buyer would need to check that he or she qualifies, find a lender and fill out the necessary SBA forms.  In order to be eligible for an SBA loan, it is necessary that the business is a for-profit venture and that it will do business in the United States.  Once the necessary forms have been submitted, it can take between 2 to 3 months for an application to be processed and potentially approved.

The simple fact is that the SBA helps thousands of people every year.  If you are looking to buy a business or expand your current business, then working with the SBA could be exactly what you need.  Of course, business brokers are experts on what it takes to buy.  Working with a broker stands as one of the single best ways to turn the dream of owning a business into a reality.

8 Tips to Get and Keep Good Employees

“I can’t get good employees.” How often have you heard this from small business owners?

Cultivating a good team is an essential challenge. Here are some tips for attracting and retaining good employees:

  1.  Model integrity. Say what you’ll do, then do what you say.
  2. Always be respectful to employees and customers, even when you’re angry. People hear how you talk about others in moments of frustration and assume that’s how you’ll talk about them when they make mistakes.
  3. Even if you know the answer, help the employee figure it out.
  4. Let your employees make little mistakes and then show the leadership compassion when you unscramble the problem.
  5. Focus local  for employees. A short commute is high value these days.
  6. Don’t be afraid to hire people who are smarter than you. When you do, let them help you.
  7. Focus on total compensation, not just the salary. Put in place bonus plans so that when the business does well, everyone does well.
  8. Hire slow, fire fast.

If you are purchasing a business, the training and transition phase is important. Usually, the seller will assist, helping you understand the ins and outs of your new business and providing stability for both your new employees and your customers. Hopefully, your new business also comes with some veteran employees who know the ropes. Try to resist making sweeping changes right away. Employees may feel  uncertain working for a new business owner. Some consistency will help them feel comfortable to keep doing their jobs. It also gives you a chance to make more informed decisions. For more tips on setting yourself and your employees up for a smooth transition, click here.

That’s a start. There are great people out there who can help your business thrive. Now the real question is, how do you become a business owner who deserves better people?

Less Risky Business: Buy a Business

In a recent Harvard Business Review article, Harvard Business School professors Richard S. Ruback and Royce Yudkoff advocate for more aspiring entrepreneurs to pursue their goals by buying a business. They site concern over risk as the most common explanation for shying away from acquisition. They further argue that these concerns are short sighted and unfounded.

Comparing Risk

“We think that these concerns about ‘risk’ are misplaced and that searching for a business is less risky than other career paths that are traditionally considered more stable,” they write.

“Nine out of ten startups will fail. This is a hard and bleak truth,” says Forbes contributor Neil Patel. “Cold statistics like these are not intended to discourage entrepreneurs, but to encourage them to work smarter.”

Top 10 Reasons Startup Fail (by CB Insights)

Purchasing a vetted business allows you to avoid many of the reasons for this high failure rate. “Your chances of success are far greater buying an existing business than starting your own,” says Michael Greene, President of Sam Goldenberg and Associates.  “A good broker can help you find an established business that already has a proven success model, history of revenue generation, and immediate cash flow. It can also come with much more: inventory, trained employees, a customer base, operating systems, equipment, vendors, transitional support—the list goes on. It’s a more manageable risk than other options.”

“Finding an existing local business for sale can often be less risky and more satisfying and rewarding than starting completely from scratch,” says Simon Brackley, President and CEO of the Santa Fe Chamber of Commerce. “Aspiring entrepreneurs can enjoy improvements in operations, marketing and strategy rather than starting from the ground up.”

Navigating the Search for a Business

Unfamiliarity with the search process is a major source of concern, according to Ruback and Yudkoff. For many buyers, there are uncomfortably many unknowns along the way.

 

A buyer can drastically limit risk in the area of search success by working with a broker. According to an International Business Brokers’ Association Market Pulse survey, “Dating back to the earliest Market Pulse surveys in 2012, surveyed advisors consistently report that approximately 49-50% of their engagements closed in a successful transition while half are terminated. This closing ratio is approximately twice the accepted industry standard of anywhere from 18% to 30%, depending on deal size.”

Buying a Small Business

Furthermore, according to IBBA, it is an especially good time for people looking to buy a business in the range of $500,000 or less. This is the range of most small businesses for sale in New Mexico. “Small business confidence is at a record high, with the longest stream of small business optimism in history.”

A broker further helps to mitigate risk by  facilitating negotiations, advising on financing, and setting up support during the transition between business owners. Click here to find out more about how brokers support buyers throughout the search for and purchase of the right business.

Finally, Ruback and Yudkoff suggest that buying a business results in less stress, more success, and higher quality of life in the long run.

“The searcher becomes a CEO of a business. Over time the business evolves to match the CEO, the management team is picked by the CEO, the products and customer base shifts to align with the CEO’s skills and interests, and the CEO is likely to understand the business better than competitors. Plus, the CEO’s significant ownership interest adds both to rewards and stability. In the long run, we think that being a senior consultant involves much more angst than being the CEO of a small business.”

Plus, with good exit planning, owning a business helps you create options for your next phase of life.

Get Started!

If you are considering entrepreneurship through acquisition, congratulations! Click here to get started by looking at our current listings.

Daniel and Jenna Johns Build on an Albuquerque Restaurant Tradition

bcd7e6f75307a40ff07a2d8c5559ebafSince acquiring Torino’s @ Home in mid-February 2016, Daniel and Jenna Johns have been busy. First came a redesign of the website with its nod to the original branding but now with a cleaner, crisper look. Next was Torino’s participation in New Mexico’s annual Restaurant Week held the second week of March.

This high-energy couple’s plans for this popular and acclaimed Northeast Heights Restaurant doesn’t stop there. With a background in restaurants and catering, the couple had been on the look-out for the right opportunity that would provide free reign for their entrepreneurial chops. What they envisioned was a venue with a solid foundation that they could enhance with the grace note of their own signature style. The pieces fell together when they contacted Sunbelt New Mexico, also known as Sam Goldenberg & Associates. After vetting the Johns, the New Mexico business brokerage arranged a confidential meeting with the then owners.

“When we walked into this one, it was almost magical. The atmosphere was amazing, the food was amazing; it was fine dining, but almost a casual atmosphere. It wasn’t pretentious,” Daniel John told the Albuquerque Journal. “We liked taking a foundationally grounded restaurant and injecting startup energy into it.”

The Johns will keep the name and preserve the focus on Northern Italian cuisine, while introducing French and Spanish influences and bringing more local ingredients into the kitchen. Echoing Torino’s sophisticated, casual ambiance, the couple’s recently inaugurated happy hours are already proving popular with Torino regulars, a diverse group made up of professionals, couples and visitors to the area.

Read the complete article at Jessica Dyer’s “Retail Roundup,” in the March 6, 2016 edition of the Albuquerque Journal.

 

 

 

New Mexico Ranks in the Top 10 for the Healthiest, Happiest States

New-Mexico-PostAs the gateway to the Land of Enchantment, Sunbelt New Mexico has long held that New Mexico isn’t only a great place to own a business; it’s a great place to live. The Gallup’s-Healthways Well-Being Index supports our assertion. This pole has been tracking the happiest, healthiest states for the last six years. According to in-depth interviews with 176 adults in all 50 states conducted from January to December 2014, New Mexico ranks in the top 10.

What are the metric of overall well-being? According to Gallup, the five essential elements include:

  • Purpose: liking what you do each day and being motivated to achieve your goals
  • Social: having supportive relationships and love in your life
  • Financial: managing your economic life to reduce stress and increase security
  • Community: liking where you live, feeling safe, and having pride in your community
  • Physical: having good health and enough energy to get things done daily

To see if there is a business that fits your interests, talents and financial goals, check-out our Businesses for Sale. Read the complete findings at the Gallup Healthways Well-Being Index.

 

New Business Opportunities in New Mexico

What a Buyer May Really Be Looking At

Buyers, as part of their due diligence, usually employ accountants to check the numbers and attorneys to both look at legal issues and draft or review documents. Buyers may also bring in other professionals to look at the business’ operations. The prudent buyer is also looking behind the scenes to make sure there are not any “skeletons in the closet.” It makes sense for a seller to be just as prudent. Knowing what the prudent buyer may be checking can be a big help. A business intermediary professional is a good person to help a seller look at these issues. They are very familiar with what buyers are looking for when considering a company to purchase.

Here are some examples of things that a prudent buyer will be checking:

Finance

Is the business taking all of the trade discounts available or is it late in paying its bills? This could indicate poor cash management policies.
Checking the gross margins for the past several years might indicate a lack of control, price erosion or several other deficiencies.
Has the business used all of its bank credit lines? Does the bank or any creditor have the company on any kind of credit watch?
Does the company have monthly financial statements? Are the annual financials prepared on a timely basis?
Management

Is the owner constantly interrupted by telephone calls or demands that require immediate attention? This may indicate a business in crisis.
Has the business experienced a lot of management turnover over the past few years?
If there are any employees working in the business, do they take pride in what they do and in the business itself?
Manufacturing

What is the inventory turnover? Does the company have too many suppliers?
Is the business in a stagnant or dying market, and can it shift gears rapidly to make changes or enter new markets?
Marketing

Is the business introducing new products or services?
Is the business experiencing loss of market share, especially compared to the competition? Price increases may increase dollar sales, but the real measure is unit sales.
When business owners consider selling, it will pay big dividends for them to consider the areas listed above and make whatever changes are appropriate to deal with them. It makes good business sense to not only review them, but also to resolve as many of the issues outlined above as possible.

How to add value to your small business to make it attractive to people seeking to buy a business.

What is the Value of Your Business? It All Depends.

The initial response to the question in the title really should be: “Why do you want to know the value of your business?” This response is not intended to be flippant, but is a question that really needs to be answered.

  • Does an owner need to know for estate purposes?
  • Does the bank want to know for lending purposes?
  • Is the owner entertaining bringing in a partner or partners?
  • Is the owner thinking of selling?
  • Is a divorce or partnership dispute occurring?
  • Is a valuation needed for a buy-sell agreement?

There are many other reasons why knowing the value of the business may be important.

Valuing a business can be dependent on why there is a need for it, since there are almost as many different definitions of valuation as there are reasons to obtain one. For example, in a divorce or partnership breakup, each side has a vested interest in the value of the business. If the husband is the owner, he wants as low a value as possible, while his spouse wants the highest value. Likewise, if a business partner is selling half of his business to the other partner, the departing partner would want as high a value as possible.

In the case of a business loan, a lender values the business based on what he could sell the business for in order to recapture the amount of the loan. This may be just the amount of the hard assets, namely fixtures and equipment, receivables, real estate or other similar assets.

In most cases, with the possible exception of the loan value, the applicable value definition would be Fair Market Value, normally defined as: “The price at which the property would change hands between a willing buyer and a willing seller when the former is not under any compulsion to buy and the latter is not under any compulsion to sell, both parties having reasonable knowledge of relevant facts.” This definition is used by most courts.

It is interesting that in the most common definition of value, it starts off with, “The price…” Most business owners, when using the term value, really mean price. They basically want to know, “How much can I get for it if I decide to sell?” Of course, if there are legal issues, a valuation is also likely needed. In most cases, however, what the owner is looking for is a price. Unfortunately, until the business sells, there really isn’t a price.

The International Business Brokers Association (IBBA) defines price as; “The total of all consideration passed at any time between the buyer and the seller for an ownership interest in a business enterprise and may include, but is not limited to, all remuneration for tangible and intangible assets such as furniture, equipment, supplies, inventory, working capital, non-competition agreements, employment, and/or consultation agreements, licenses, customer lists, franchise fees, assumed liabilities, stock options or stock redemptions, real estate, leases, royalties, earn-outs, and future considerations.”

In short, value is something that may have to be defended, and something on which not everyone may agree. Price is very simple – it is what something sold for. It may have been negotiated; it may be the seller’s or buyer’s perception of value and the point at which their perceptions coincided (at least enough for a closing to take place) or a court may have decided.

The moral here is for a business owner to be careful what he or she asks for. Do you need a valuation, or do you just want to know what someone thinks your business will sell for?

Business brokers can be a big help in establishing value or price.