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True Entrepreneurship MARY LOU WALKER’S PIONEERING SPIRIT PG. 8 A Publication of The Firm Business Brokerage

Spring 2017

BUYER POWER EDITION

Volume 1 Issue 12

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Published by The Firm Business Brokerage President/Editor • Cortney Sells Director/Assistant Editor • Cassandra Powers In-House Legal Counsel • Susanne Miller In-House Accountant • Cassandra Waltrip Brokerage Principal • Rene Rademacher Director of Strategic Development • Rachael Rand

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A Publication of The Firm Business Brokerage

The Bottom Line

True Entrepreneurship Mary Lou Walker’s Pioneering Spirit

Special Section

Features

7 Take Our Hand

Sweet Deal 4 AGigi’s Cupcakes Continues Its

The Firm Business Brokerage has

over $90 million in assets under management of current cash-flowing businesses for sale—from contracting companies, to professional service businesses, to medical-based

Your Future 6 Funding Why Building Banking Relationships

Commitment to Community

Entrepreneurship 8 True Mary Lou Walker’s Story of Breaking Barriers

the Distance for 12 Going The Right Deal

practices.

Columns

When a Buyer Fits the Bill from

Can Help Your Business Grow

Negotiated: Four Top Tips for 14 Long-Distance Counsel

Impact: 15 Executive Client Interfacing in the Digital Age

Across State Lines

Bridging the Deal Gap 13

A Tennessee Business Owner Finds

State Representation is Important For Securing the Best Deal

Creating a Personal Experience

A Match in a Nebraska Broker

Sells Insights

Great Deals Can Be Found Anywhere

I

by Cortney Sells president/editor

n this issue, we look at how What makes the whole probuyers and sellers navigate out- cess of finding and buying a busiof-state deals. ness or investment out of state successful is the strength of the Recently, I was invited to an deal team you put in place. Suropportunity to invest in a busirounding yourself with experts in ness park in Indiana. After looklaw, accounting, and brokering ing over the details and lining makes a worthwhile buy a viable up the proper parties, I began opportunity. Your team of knowlto think about how much easier edgeable, trained professionals cross-border transactions have will guide you through making an been made due to technology. offer and ensuring that everything No longer are our financial prosfinancial and legal is done by the pects limited to proximity, and, with book. Most importantly, this can that barrier removed, we are free to all be done remotely. search high and low for a business with the right cash flow. The possibilities become endless with the click of a button.

Keep in mind that while it is now easier than ever to own successful businesses across the country, community relationships with lenders and attorneys should be fostered wherever possible. You never know what opportunities may come your way when you have connections looking out for your best interest. With that being said, I invite you to consider how big your investment horizon is at the moment. Now take away the long-distance hurdles and see how much brighter that vista becomes.

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Summer 2017

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A Sweet Deal GIGI’S CUPCAKES CONTINUES ITS COMMITMENT TO COMMUNITY written by Kathy Rygg

tionships with both employees and customers,” she says. “We’re so grateful for everything and will continue to be strong advocates for Omaha.”

SuZanne says that when she first met the

T

Greens, they hit it off right away. “I thought to myself, these are the right people. I thought they cared about the same things I did and had the sensitivity toward people, product, operations, and sales.” The feeling was mutual. “We really liked SuZanne, and she presented the business so well,” Scott says. In fact, he and Tammy made their decision to purchase Gigi’s that same day after meeting SuZanne. “It’s such a family-oriented business,” Tammy added. “She cares about her employees and they care about her.

We want to keep it that way.”

were a number of other appealing aspects about Gigi’s Cupcakes. The location was near their home, the hours of operation worked well with family life, and it was something their daughters could be involved in.

The type of business also fit with both of their strengths. Tammy excels at customer service and will run the daily operations, while Scott can oversee the financials. They have no plans to make any changes to Gigi’s, but will focus on maintaining its high level of success. “It’s exciting and nerve wracking at the same time,” Tammy says. “There’s something new to learn every week, but once we go through training, hopefully we’ll progress quickly.”

here’s something about the aroma

The actual process of purchasing the busi-

of freshly baked cupcakes. Maybe it reminds us of childhood, or a parent or grandparent. It’s comforting and energizing. And it brings people together. Providing that type of community-minded product is why SuZanne and Grant Rogers first decided to open Gigi’s Cupcakes in West Omaha five years ago. And it’s a legacy that new owners Tammy and Scott Green hope to continue as they operate and grow their new business.

ness went quickly as well. The Greens and Rodgers attributed much of that to working with The Firm. “The sale wasn’t overwhelming. The Firm did a good job of keeping us informed,” Scott says. SuZanne wanted a company to represent her that was professional, honest, and had good communication, and she says that’s exactly how The Firm works. “The Firm has close ties to the community like we do, which was important to me,” she says.

SuZanne says they originally wanted a business that their whole family could be involved in. They also wanted a business that supported their desire for charity work and involvement with community, such as school and church sponsorships. On a corporate level, Gigi’s Cupcakes was aligned with that mission and provided an ongoing, high level of support, even though it’s headquartered in Tennessee.

“We’ve had very good experience with Gigi’s as a franchise, and it’s bittersweet to give it up,” SuZanne says.

The reason behind their decision to sell is that their sons are in high school and they want more time to participate in the kids’ activities.

They also want to launch into new personal ventures. SuZanne says she will still be available to consult for the new owners Tammy and Scott Green as needed, and will continue to keep in touch with employees. “We established the brand in Omaha, were a Best of Omaha winner three years in a row, and developed strong rela-

OVER TIME THE GREENS HOPE TO GROW GIGI’S AND EXPAND THE BUSINESS, PERHAPS OPENING KIOSKS IN TOWN AND EVEN ADDING A SECOND LOCATION. Finding a family-oriented business was important to the Greens. They have four children, and showing them what’s involved with owning your own business is something they want to provide for them as they grow up. They had been exploring more retail-type businesses, and when they discovered Gigi’s was for sale, they were immediately interested. “We had gone to Gigi’s for Scott’s birthday and the next day we found out it was for sale,” Tammy says. “Everyone had been talking about how good the birthday cupcakes were!” The Greens also have a daughter named Gigi—another heartwarming coincidence.

Tammy and Scott originally began looking to purchase a business to enable Tammy to spend more time with their children. As a flight attendant for Southwest Airlines, she was traveling up to three days a week. Scott is the vice president of a manufacturing company and was interested in diversifying financially. There

Over time the Greens hope to grow Gigi’s and expand the business, perhaps opening kiosks in town and even adding a second location. For now they are looking to SuZanne’s leadership in the community and to become involved as much as possible with local schools, the chamber of commerce, and other organizations, as well as to establish similar strong connections with employees and customers.

And SuZanne feels they’ll be successful in their efforts. “I’ll help them with the transition as much as they want,” she says. “And Gigi’s as a franchise will help augment all the skills they already have to help them be successful in this business.” THE FIRM

The Firm Deal Review Lending: Seller Promissory Note Reason for Sale: Moving out of state Franchisor Location: Tennessee Offer to Closing Date: 52 days

Summer 2017

The Firm Deal Review

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Funding Your Future WHY BUILDING BANKING RELATIONSHIPS CAN HELP YOUR BUSINESS GROW written by Jeff Ash

AN OWNER’S CHARACTER IS AN IMPORTANT ASSET THAT CAN BE HARD TO QUANTIFY. A BANK IS LOOKING FOR AN OWNER WHO WILL BE UPFRONT WITH ISSUES THE BUSINESS IS FACING AND WILLING TO MAKE TOUGH DECISIONS WHEN NEEDED.

B

uying a business can be a very re-

warding, yet daunting, undertaking. It may be one of the largest single financial transactions in your life, so there is a lot to think about and questions to ask yourself, such as: • What personal skills do I have that will help me run the business?

• How much income am I tr ying to replace, or supplement, with the new business?

• What kind of work-life balance will I have as the owner of a new business?

• Do I have the right professional advisers (CPA, attorney, etc.) to help me evaluate the purchase opportunity and provide advice post purchase?

• Finally, where is the capital coming from to purchase and operate the business?

Unless you recently won the lottery, you probably need, or want, to finance a portion of that required capital. More than likely you will then need to discuss obtaining a loan from your bank.

When you approach your bank, there will be several things they will want to understand in order to suggest the right type of financing for your situation. Some pretty obvious items

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The Firm Deal Review

Summer 2017

include the cash flow of the business, what collateral can be pledged to secure a loan, and how much money you can inject up front, as well as in the future, if cash flow becomes strained.

However, there are other considerations, like the economic outlook of the industry you are buying into and your character as a borrower.

The latter is one that many people spend little time thinking about.

business. Some industries require specialized knowledge. Plus, it helps if the lender can understand some of the challenges you will face.

Lastly, discuss what your future growth goals are and what financing may be needed. You want to know if the bank has the capacity and willingness to grow with you.

This can be made more difficult if the busi-

that can be hard to quantify. A bank is looking for an owner who will be upfront with issues the business is facing and willing to make tough decisions when needed. A bank is also looking for someone who understands the business and can demonstrate that they can be a good operator. This is all in an effort to mitigate the inherent risk of providing a loan, coupled with being able to provide future financing as needed, because the bank knows you and understands the company you operate.

ness you are looking to purchase is in a different geographical market than where you reside. In this case, your banker is going to want to understand how you plan to manage your business.

Do you plan to move, commute each week, or manage remotely? If you already have a strong banking relationship, then your bank may feel comfortable working with you even if the business is not near a location they have. If not, building a relationship with a bank that has locations in both areas will be something you may want so they can continue to meet your financing and banking needs.

This is why I recommend building a relation-

No matter what your business goals may be,

ship with a bank before you start the process of purchasing a business. A simple first step can be establishing your personal accounts with the bank, along with taking the time to sit down with their lender to explain what your plans are for the business. At that point, you can discuss what is important to the bank in order to explore the kind of financing you are looking for. Ask about their experience with the industry in which you are looking to purchase a

working with the right bank from the beginning can bring your ideas to fruition. Whether you plan on buying an existing business or starting from scratch, your lending institution needs to put a face with the loan, especially if you plan on owning remotely. Owning your own business can be challenging, but the rewards are numerous, and your path to success will be easier if you work to build a relationship within the lending community. THE FIRM

An owner’s character is an important asset

A Publication of The Firm Business Brokerage

Take Our Hand: FEATURED OPPORTUNITIES FOR SALE Fitness Franchise with Separate Personal Training Business

Livestock Concrete Water Tank Manufacturer; 620-plus International Retail Locations

PRICE $204,000 OWNER PROFIT $67,750

PRICE $900,000 OWNER PROFIT $286,715

This fitness franchise located in Southwest Omaha with a separate personal training business within the gym is perfect for a

With a proprietary concrete formulation of

personal trainer looking to increase a client list and earn extra income. Under current

9,000 PSI, this business has carved a niche in the market for feedlots, cow/calf oper-

ownership since 2009, gym membership has increased from 150 customers to 600

ations, zoos, and oilfields looking for a superior, hardy product to water their animals.

with a capacity to include another 500.

Stocked in over 620 retail locations between Canada and the U.S., the products are manufactured at their Nebraska plant and distributed across North America.

**20+ Location Nutrition Store Package

Home Medical Health Care Assistance— $800K-plus in Sales

PRICE $13,372,832 OWNER PROFIT $4,068,661 These high-quality nutritional supplement re-

PRICE $843,000 OWNER PROFIT $220,189

tail stores focus on creating safe and effective

With 17 medically certified and experienced

sports nutrition, weight loss management,

caregivers on staff, this business requires

and general health programs. Providing per-

no medical background in order to own it.

sonal service, welcoming store environments, and well-tested products allow customers

The company, which began in 2004 and serves Omaha and surrounding communities,

to live a healthy lifestyle.

has a mission is to provide professional medical assistance to patients who wish to continue living in at home.

Country Vet in Operation Since 1918

Absentee Foam Jacking & Concrete Lifting

PRICE $985,000 OWNER PROFIT $262,875

PRICE $142,000 OWNER PROFIT $29,169

Grossing over $900k in sales from a loyal

This business started in May 2013 as the first

client base of over 2,000, this country vet

real foam jacking company in the Omaha

has been in continuous operation since 1918.

metro, and has continued to steadily grow. It

Located in a small community just a short

offers all your concrete lifting needs, including

drive northwest of Omaha, three veterinarians and one vet tech provide area pets with

caulking and sealing. With a labor staff of two working five days per week, roughly five

preventative care, emergency services, diagnostic examinations, and grooming and

to six jobs are completed each day, with the average ticket running from $400 to $500.

boarding services.

Two-Location Growing BBQ Franchise

Kid-Centered Salon with Fun for All

PRICE $381,000 OWNER PROFIT $141,308

PRICE $205,000 OWNER PROFIT $82,374

Part of a strong franchise with over 500 lo-

An exciting atmosphere with entertaining dis-

cations. These two locations are so new that

tractions for kids and services for parents

the paint is still drying on the walls, and one

make this Omaha salon a unique experience.

of them is in a major shopping area that is

Focused on making haircuts easier on kids

still undergoing construction. The first location was opened in 2014 and the second

and parents, the salon is bright and inviting, with lots of electronic entertainment and

opened in 2015.

kid-friendly chairs. Opened in 2007, over 16 customers/hour and 200-350 customers/ week are treated to fun and style by the eight stylists.

** Broker’s Choice | 110+ Available Business Opportunities For Sale. Please visit TheFirmBusinessBrokerage.com for details Summer 2017

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True Entrepreneurship Mary Lou Walker’s Story of Breaking Barriers Writen by Maureen Tierney | Photography by Bill Sitzmann

The Firm Deal Review Seller CPA: Leonard Sommer, Hancock & Dana Buyer’s Location: Atlanta, Georgia Valuation: Cost to create Transition: Manager, and all staff, are staying on

T

he old saying, “it takes a village” is a tired cliché, but it’s one of those rules of thumb that is often the greatest measure of success, and rightly so. Mary Lou Walker, a longtime fixture in many Omaha circles, found that the support of family and friends has opened doors she never would have thought about peeking through. At 83 years old, with over 60 years in the beauty industry, she’s just sold her second successful business and is looking forward to enjoying what lies ahead.

provide financial support. It was a decision that so many in her generation experienced, and the only negative thing she can say about her time working in the Swanson packing plant was that she “could hardly look at chickens for the next 20 years.”

Walker eventually found work at Brandeis & Sons, where she rose to become the director of Beauty Salons. Her indomitable energy was noticed early. She took time away from working at Brandeis, but was called back for what she thought would be a short-term assignment. “I came back to Brandeis on a lark, after one of the big shots there called me up and asked me to come in again. Twenty-two years later, I was still there,” says Walker.

Eventually she oversaw the 11 salons Brandeis operated across Omaha, Des Moines, and Lincoln. She helped design them, oversaw financials, and led advertising for each of them.

Just a few short years before Younker’s

Walker’s story is punctuated by humble beginnings, but is all the richer for them. An Omaha native, Walker was the only girl in a family of seven boys, a fact that she says has made her tougher. But it was the early death of her father that would become a major influence in her entrepreneurial endeavors. Her mother, who suddenly became a single parent of eight, had to make ends meet by working more than one job, but Walker says, “We still had food on the table and the house was clean. We didn’t know we were poor. My family was great and happy, and we were very close. I had what I needed and was happy with it.”

In a family of boys, it would be easy to get lost, but Walker took her cues from her mother, whose spirit and remarkable strength was closely watched by her daughter. Family, a constant hallmark for Walker, was an influencing factor in her need to drop out of school at 16 to help

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MARY LOU WALKER, A LONG-TIME FIXTURE IN MANY OMAHA CIRCLES, FOUND THAT THE SUPPORT OF FAMILY AND FRIENDS HAS OPENED DOORS SHE NEVER WOULD HAVE THOUGHT ABOUT PEEKING THROUGH. She is quick to point out that she didn’t go on to create one of Omaha’s most popular salons without help and support from Arthur and their family. “My entire success revolves around my family, their big support and help,” she says. “One person can’t build or buy a business without help.”

bought Brandeis, Walker’s husband, Arthur, started a Nissan dealership in Bellevue with their son, David. When she decided to retire at age 55 after the Younker’s purchase, Walker was hardly looking to become a business owner, but she was soon approached by a Kansas City businessman with ideas for developing One Pacific Place. Her husband would then become a huge part of getting her first salon, Garbo’s, up and running.

running a part of Garbo’s salons in Omaha.

Her daughter, Roxanne Kahn, ran the Regency location and oversaw the Eagle Run Garbo’s.

The décor and salons were designed by Walker’s other daughter, Denise Gooden. Walker’s granddaughter, Rebecca Kahn, was at the helm of another location.

Many younger women find it hard to imag-

Walker, who likes to pack her life with ac-

ine how difficult it was to be a female entrepreneur as late as 1988. Walker faced roadblock after roadblock from banks that would not lend to a woman, especially one without previous ownership experience. Eventually, she was granted a $38,000 loan only if her husband would co-sign. So, at a time when most people are retiring or thinking about retiring, Walker was becoming a first-time business owner.

tivities to keep her busy, then endeavored to start a floral shop for daughter-in-law, Debi, who had been working for an investment group. In 1994, Stems was opened at Countryside Village, and the personal touches and one-of-a-kind service established it as an elite floral business.

Much like Garbo’s, Stems was a success due to the people that Walker surrounded herself with. continued on page 11 >

Most of Walker’s family was involved in

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>

continued from page 8

She credits a good amount to the stylists at Garbo’s and the floral designers at Stems, emphasizing that, “you’re only as good as the people that are there and work for you.” For Walker, it’s the “people that make you successful.”

While everyone pulled together to make both companies true family businesses, their strength came to a test when Walker was diagnosed with pancreatic cancer five years ago.

Unfortunately, during the time of Walker’s illness her husband of 58 years passed away. It was at this point that her children and grandchildren really “hung in there and stuck by [her] side with the cancer treatments,” she says. Her years of paying it forward had finally come back, she adds, noting a philosophy that has informed her personal and professional life to great degrees.

Now on the flipside of her brush with cancer, Walker is eager to embrace the future and enjoy an active retirement. Her six grandchildren are an important joy in her life, and she actively keeps in touch with them through texts. Though many of her brothers are now gone, she still fondly remembers their almost-daily phone calls.

Above all else, family ties made the hard times easier, and even though she attributes much of her business success to those around her, the extraordinary effort of treating customers and employees right was what built Walker’s reputation in Omaha.

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You might think that, at 83, Walker would be ready to take it easy, but she’s still making sure her life is packed with adventure. Her daughter, Denise, lives in Malibu, and although Walker visits her twice a year, she’s not ready to leave Omaha behind. “I love Omaha. I love that my family is here, and there’s no place like home,” she says. After all, it was a community that helped Walker become a successful business owner two times after age 55. “My family was involved in everything, and I would not be where I am at all without them.”

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Business Birthdays— TIME TO CELEBRATE written by Cassandra Powers

W

hat’s better than a celebration? When an individual takes the next steps to begin a life changing venture, years of success are a fantastic

reason to celebrate. It’s not just people who get to have birthdays, businesses do, too! It’s important to reflect on the opportunities for which we can celebrate another year in business. We’d like to take just a short glance at three specific businesses that are enjoying their first, third, and fourth years in business. These three business owners have different stories as to how or why they decided to take the leap and become entrepreneurs, all thanks to The Firm Business Brokerage.

John Perlebach of Nu-Trend Dr y Cleaners With six locations and nearly 50 employ-

CELEBRATING 1 YEAR Derrick and Kaitlyn Reinhar t of Dogtopia.

ees, Perlebach is happily celebrating ownership for 3 years with this Nu-Trend. Perlebach has always been big on small business, as he has been a part of them for years. Growing and improving each location was of key importance for Perlebach, and that is exactly what he has done. Providing better signage and increasing branding was done immediately. Growing year over year has been a goal, and success and determination is paying off.

CELEBRATING 4 YEARS Greg Arauza and Rod Meier of Comfor t Plus

Celebrating 1 full year of business own-

These partners in business are celebrat-

ership this May, this couple could not be more thankful for the ability to work with Randy Bauer of Mutual First Credit Union to make this dream come true. This deal took more than 6 months to close, but it was worth the wait. Having exceeded their goals and dreams in just one year, Dogtopia is flourishing with great things to come. Derrick’s advice to other business owners looking to purchase is to make sure it’s a business you can love, and not just to make a purchase for the cash flow it can bring in. “It might be appealing at first, but six months down the road when the newness wears off, you still have to love it,” he says.

ing a fourth year together. Arauza and Meier purchased Comfort Plus Shoes on 156th Street and West Dodge Road in Omaha, and 64th and O streets in Lincoln, with the assistance of Katie McHenry of Great Western Bank. Having a strong desire to own a multi-location retailer, this was a perfect fit. The business showed continuous growth in sales and in profit. Having the sellers, a mom and daughter duo, train and transition for three months was essential in the business and the buyers’ success. Arauza and Meier are not only partners in this venture but also own a couple of other businesses together. When you find a friend and a business partner, there is never an end to the possibilities of success.

CELEBRATING 3 YEARS

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Summer 2017

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Going the Distance For the Right Deal When a Buyer Fits the Bill from Across State Lines written by Maureen Tierney

T

hey may be in the same state, but the cities of Omaha and Paxton don’t resemble the same Nebraska. One is a metropolitan hub on the Iowa border, while the other is a small town nestled between North Platte and Ogallala. Paxton actually has more in common with nearby, rugged Colorado than its sister to the east, but saying so would be selling short the mutual Cornhusker spirit both cities share.

Besides, Omaha has one thing that Colorado doesn’t, and that is the only brokerage that was able to help Rick Anderson sell his 60-year-old sand and gravel operation.

Anderson has spent his entire life around Anderson Sand & Gravel, which was begun decades ago by his father. “I started getting paid when I was 10 to help out. When I was 13, I began running gravel, and as a teenager I took on more responsibilities,” says Anderson. When his father became ill, Rick’s uncle purchased the company and Rick left town for work elsewhere. Eventually he came back and bought the company from his uncle over 20 years ago.

In the past few years, Rick started thinking about retirement, and with that came the realization that he needed to find a way to sell his family company. Neither of his sons were willing or able to continue the tradition of family ownership, and even though Rick had started slowing down, bids kept coming in faster than he was willing to handle.

12 The Firm Deal Review

Summer 2017

“IN ALL, WE WENT OUT TO PAXTON, TRAVELING 2,763 MILES TO SHOW ANDERSON SAND & GRAVEL TO POTENTIAL BUYERS.” Cortney Sells, president of The Firm.

Geographically speaking, Denver is closer to Paxton than Omaha, but Anderson found that the brokerages in Denver were more interested in earning a paycheck than in understanding his needs and the nature of his company. Luckily, Anderson was able to find that understanding with The Firm Business Brokerage.

“In all, we went out to Paxton, traveling 2,763 miles to show Anderson Sand & Gravel to potential buyers, says Cortney Sells, president of The Firm. Interested parties were brought in from Georgia, Colorado, and Wyoming. Rick, who listed his business with The Firm in September 2016, saw three offers by the end of January for his gravel operation, which is run out of two locations in and around Paxton. During 2016, approximately 35,000 tons of aggregate were sold out of the main location in Paxton, where product is dug from 100 acres along the South Platte River. Amazingly, only 30 percent of the land has been utilized in the past 30 years by the company.

Rick is proud of the business his father built and was then able to share through the generations. The location of Paxton lends itself to tremendous opportunity, as Anderson conducts business within a 50-mile radius and deals with very little competition. “We are more personable

and easier to deal with,” he says. He adds that location is important to the business, and the 100 acres that Anderson uses for aggregate production leaves little room for other stakeholders.

This unique location is exactly why buyers had to be brought in from far away. Ultimately a fit was found in Pine Bluffs Gravel & Excavating in Pine Bluffs, Wyoming. Located over 140 miles west of Paxton on the Nebraska border, Pine Bluffs is a town not unlike Paxton, with a small population and an agriculture-heavy economy.

For Rick Anderson, keeping jobs and the Paxton economy strong were important factors in deciding who was best suitable to take over.

For Sells, the distance between Omaha and Paxton wasn’t a deal breaker. “We always strive to make sure our clients, both buyers and sellers, are a good match, even if that means looking far beyond Omaha and Nebraska,” says Sells.

While most transactions can be done with the click of a button, a personal touch is still important, and that’s what set The Firm apart from other brokers closer to Anderson.

Finding the right fit with a broker was just as important to Anderson as finding the perfect buyer, no matter the mileage between the two.

THE FIRM

The Firm Deal Review Seller Location: Paxton, Nebraska Buyer Location: Pine Bluffs, Wyoming Out-of-State Buyers: 4 Offers Recieved Buyer Type: Strategic

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Bridging the Deal Gap

A Tennessee Business Owner Finds a Match in a Nebraska Broker written by Maureen Tierney

There comes a time in the life of every business when the owner decides to sell. After all the years of hard work and sacrifice, the personal reward of ownership no longer makes the financial return worthwhile. Each CEO, president, and owner-operator must weigh the value of their time and needs against the long-term health and success of the business. It’s one of the hardest decisions a business owner faces, but finding the right buyer can be just as tough.

Most sellers are concerned with confidentiality. They want to ensure that the flow of business goes uninterrupted throughout the sale and transition from their leadership to their successor’s. For one health care business owner in Tennessee, this was a vital condition in choosing the right brokerage to transact the sale of her company. “We’re seeing more and more business owners increasingly concerned with making sure that their decision to sell is kept confidential throughout their time with The Firm,” says Susanne Miller, in-house legal counsel. April Gentry, who worked with Miller from beginning to end, is no exception.

While it would have been more convenient to work with a broker in her home state, Gentry chose to venture as far as Nebraska to work with the right firm, even though it meant working in different time zones. Distance could not hinder her determination to keep her employees’ jobs safe, and working with a local broker was impossible in her mind as many a contract can turn sour when the whisper of a sale reaches the wrong ears at the wrong time. Maintaining confidentiality in her decision to sell was an unspoken agreement with her employees, and helped to foster their continued relationships with clients. When employees and clients are

kept out of the equation, the sale of a company can be more about the business and less about the personnel.

The beauty of convenient technology is that Gentry’s wish for confidentiality was easily accomplished. Introductions and business deals with The Firm were all conducted using telephone and email communication.

Qualified buyers were contacted and introduced to her health care company, many within Tennessee and nearby states. Ultimately, the right buyer was found in Beau Brothers, a fellow Tennessean.

While it may seem like an insurmountable task to broker successful deals across border lines, it’s done more often than you might think, says Susanne Miller, in-house legal counsel for The Firm. Miller was a key player in the deal between Gentry and Brothers, working with both parties and their respective legal advisers. “So many emails are sent back and forth with each deal, and while it can get harried sometimes, deals can still come to fruition whether you’re down the street or across the country.” When all the right players are in place, proximity is the least important detail, adds Miller.

For The Firm, confidentiality is a cornerstone of each deal, a factor that heavily influenced Gentry’s decision to list her company with an out-of-state broker. While not every transaction is best completed sight unseen, often the details on paper are more important than the physical aspects of the company. When that’s the case, the ability to shop for brokers can be quite flexible. “With each deal we broker from across Nebraska and beyond, we open up our services to even more

“WITH EACH DEAL WE BROKER FROM ACROSS NEBRASKA AND BEYOND, WE OPEN UP OUR SERVICES TO EVEN MORE PEOPLE, AND CONTINUE TO PROVE THAT LOCATION AND SERVICE ARE NOT MUTUALLY EXCLUSIVE.” Susanne Miller, in-house legal counsel

people, and continue to prove that location and service are not mutually exclusive,” says Miller. She anticipates that The Firm will see more and more businesses across the nation seek out brokerages beyond state lines. Even though Gentry chose to work with a Nebraska broker, she was still paired with a local buyer in Brothers, demonstrating that business can be found in the unlikeliest of partners.

THE FIRM

The Firm Deal Review Buyer & Seller Location: Tennessee Financing Type: Conventional Loan Acquisition Type: Stock Sale Due Diligence Time: Over 90 days

Summer 2017

The Firm Deal Review 13

A Publication of The Firm Business Brokerage

Negotiated: Four Top Tips for Long-Distance Counsel STATE REPRESENTATION IS IMPORTANT FOR SECURING THE BEST DEAL written by Tosha Heavican, attorney at Brodkey, Peebles, Belmont & Line, LLP

H

aving served both as counsel for clients buying and selling businesses locally, and serving as local counsel for out-ofstate buyers in the purchase of a business, I understand the importance of both sides. Utilizing counsel both out-of-state and locally to facilitate your transaction is particularly advantageous for handling the special hurdles that long-distance purchases carry. When entering negotiations for what can be a very large investment, it is essential to have the right people in your corner looking out for your interests as you embark on this new journey. While the dreams are soaring and the anticipation is high, purchasing a business is not had without a little hard work.

To help accomplish the end goal, here are the top four pointers for out-of-state buyers seeking to purchase a business:

1. Determine the Workload Distribution Probably the most important conversation that a client will have with their local and long-distance counsel is the distribution of tasks that need to be accomplished in order to purchase a business. In my most recent experience, where my firm served as out-of-state counsel for an investment company purchasing a local business, we provided legal expertise on establishing various holding entities for purchase of the business, as well as serving in an advisory capacity on questions of local law. The allocation of roles within this multi-attorney relationship with the client happened in the very early stages of our firm’s engagement with the client.

2. Know the Fee Structure

signature. Having a fee agreement helps everyone stay on the same page for issues regarding what will be billed, what rate will be charged, whether a portion or all the services will be hourly or on a flat-fee basis, and the amount of retainer required by the attorney to begin performing legal services.

This agreement can also be instrumental in understanding which attorney will perform each task needed to complete the business purchase, as discussed above.

Having an open and honest conversation about fees goes a long way in preventing future conflict between clients and their various counsel.

3. Surround Yourself with Experts Choosing an attorney and other advisers that are comfortable with the local laws relevant to your business purchase is key to efficiently and cost-effectively purchasing a business. For example, in the state of Nebraska, when an individual sets up an entity, first they must file a Certificate of Organization with the Secretary of State. Once the filing is accepted, notice of the entity formation must be published in Nebraska in a newspaper of general circulation near the designated office of the entity. If publication is required in another state, such publication costs and requirements range drastically, depending on which state you are establishing your entity. If your company planning to operate in multiple states, additional filings are likely required in the foreign states in which your business will operate. A local attorney will be able to advise you of what is required to comply with local law for your entity.

4. Start Early

It is always important for a client to

The added factor of distance, not

understand the fee structure in which they will incur fees and costs from an attorney.

It is even more important for an out-ofstate buyer who is likely incurring fees from two attorneys – the attorney in their home state and the attorney in the state where the business is located. It is very typical for attorneys to provide fee agreements for the client’s consideration and

otherwise present with a local buyer, can prolong the process of document review, document approval, negotiation, and other logistics. While technology proves helpful in perpetuating the transaction, there is often delay in receipt of faxes, emails, and overnight packages. Frequently there can be a disconnect or loss of understanding in written communication that an in-person

14 The Firm Deal Review

Summer 2017

WHEN ENTERING NEGOTIATIONS FOR WHAT CAN BE A VERY LARGE INVESTMENT, IT IS ESSENTIAL TO HAVE THE RIGHT PEOPLE IN YOUR CORNER LOOKING OUT FOR YOUR INTERESTS AS YOU EMBARK ON THIS NEW JOURNEY. conversation would not suffer. In order to overcome some of those communication barriers, often the buyer, attorneys and other professional advisers have to spend extra time writing out explanations in emails or participating in telephone conferences.

Failing to allot yourself enough time to have those important conversations breeds mistakes and misunderstandings, which is not what any buyer wants going into such a large investment. Allow yourself and your advisers enough time to properly consider the task ahead and obtain the best result for you.

Arming yourself with the right knowledge will ease your transition to ownership, both locally and remotely. It’s in your best interest to seek out the proper counsel so that your business needs are met and your company can flourish.

THE FIRM

A Publication of The Firm Business Brokerage

Client Interfacing in the Digital Age CREATING A PERSONAL EXPERIENCE written by Liz Jones, business broker at The Firm Business Brokerage

“AT ANY GIVEN TIME, OUR FIRM HAS OVER 100 BUSINESSES LISTED AND ADVERTISED ACROSS MULTIPLE WEBSITES, AND IT’S IMPORTANT THAT I MAINTAIN COMMUNICATION REGULARLY WITH ALL POTENTIAL CLIENTS.” Liz Jones, broker at The Firm

A

s the largest and most established business brokerage firm in the Midwest, The Firm Business Brokerage attracts clients from all over the United States, and even Canada. At any given time, our firm has over 100 businesses listed and advertised across multiple websites, and it’s important that I maintain communication regularly with all potential clients.

A large part of what I do on a daily basis is speaking with clients, whether it be in person, over the phone or via email. I make an effort to really get to know all of my clients, entrepreneurs, and future entrepreneurs alike. It’s not always possible to meet face-to-face as many of my clients are out of state, and oftentimes even outside of the Midwest. In these cases, I utilize a few different technological tools to help personalize and professionalize the buying and selling process.

there are times the client just wants to complete the interview on initial contact and I do honor that request as well.

I use the same private conference line when facilitating a meeting between a potential buyer and business owner. As opposed to going back and forth with questions from the buyer to the seller via email, I connect them face-to-face or via phone. This conference line is a great tool to use, especially when there are multiple partners on the buy side.

Recently, we introduced video calling into our communication toolbox. This will serve to create an even more personalized relationship between not only myself and the clients, but between the clientele as well. It’s always good to put a name with a face, and video conferencing is the next best thing to having a personal meeting when it isn’t possible to do so.

When I receive a request for information

Another form of technology we use in

from a potential client, I call and email them immediately. Once I reach them, I set up a time to complete an initial interview in my office or over the phone for those that aren’t local. For this I use a private dialin conference line, where the client will call into our company’s designated number and enter a code to be connected with me for the interview or conference call. I find this to be a far more professional interaction than just a spontaneous phone call. Of course,

working with out-of-state clients is wire transfers. After all closing documents are agreed to and signed, we are able to wire funds on the day of closing. This electronic component has made the closing process for our out-of-state deals extremely easy for all parties involved.

works for months. Our new website and CMS system will create an even more enjoyable client experience. With the CMS system in place, I’ll be able to spend more time with my clients while continuing to build ongoing relationships with them. Without a relationship, there is no trust and, without trust, there is no deal.

As we were building our new website, our focus has been on client experience. The clients will be able to maintain a private and confidential profile complete with all of their personal information while they shop for businesses according to their specifications. Once they locate a business that meets their criteria, I step in. My job is to assist them in getting all the information they are looking for and facilitating all meetings throughout the process, while working toward the ultimate goal of placing them with the right business for their wants and needs. Technology affords me the ability to do this remotely.

In the name of innovation, we continue to implement tools as new communicative technologies come available. Staying a step ahead gives us the competitive edge when it comes to serving the needs of all of our clients, both in-state and nationally. THE FIRM

In addition to the video calling and wire transfers, we are proud to release our proprietary software and brand new website that has been in the Summer 2017

The Firm Deal Review 15

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Summer 2017

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