As a management consultant who has brokered over 300 small businesses, the author, Wilbur Yegge knows the intricacies involved in the transaction process--and how to overcome them.
The learning objective of this course is to review the ins and outs of the purchasing and vending process, covering everything essential to conclude a successful transaction. Packed with numerous examples, helpful tips, and even a special section on "Yegge's rules," this course will help you understand the building blocks of a successful transaction.
Lesson and Objectives |
Reading
Assignment |
| A Basic Guide for Buying and Selling a Company |
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1. The First Question |
Chapter 1 |
The learning objectives for this lesson are to gain an understanding of:
- The pros and cons of owning your own business
- The number 1 rule of effective negotiation
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| 2. Usable Lessons from Buying or Selling a Personal Residence |
Chapter 2 |
The learning objectives for this lesson are to gain an understanding of:
- Emotions with buying or selling
- Contractual obligations
- Working with brokers
- Risk and financing differences
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| 3. When the Deal Looks to Good to Pass |
Chapter 3 |
The learning objectives for this lesson are to gain an understanding of:
- Quality suspicion
- How most deals do not start as good deals
- How the deal must be good for both parties
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| 4. Business Brokerage as an Aid |
Chapter 4 |
The learning objectives for this lesson are to gain an understanding of:
- Business brokers
- Urgent actions
- Asking for help
- Laws of agency-principal relationships
- Selecting a business broker
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| 5. Conceptual Principles |
Chapter 5 |
The learning objectives for this lesson are to gain an understanding of:
- Product acceptance
- Win-win negotiating
- Why the seller is often in a stronger position
- Negotiating with people who don't want to sell
- Maintaining optimism
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| 6. The "Four Steeds" of Business Purchase and Sale |
Chapter 6 |
The learning objectives for this lesson are to gain an understanding of:
- Fear of the unknown
- Supply and demand
- Fear of the instrument
- Compliancy
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| 7. Confidentiality |
Chapter 7 |
The learning objectives for this lesson are to gain an understanding of:
- Privacy
- Confidential discovery
- Announcements to the "world"
- Middle brokers and helping with confidentiality
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| 8. Fishing Expeditions |
Chapter 8 |
The learning objectives for this lesson are to gain an understanding of:
- The enlightened buyer
- The enlightened seller
- Unrealistic expectations
- Litigation
- Market inversion
- Reducing contributions to fishing expeditions
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| 9. The Selling Prospectus |
Chapter 9 |
The learning objectives for this lesson are to gain an understanding of:
- What to include
- What not to include
- Offering documents
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| 10. Subordinate Cash |
Chapter 10 |
The learning objectives for this lesson are to gain an understanding of:
- Terms, collateral, and balloon payments
- The stripping dilemma
- Effect of subordinate financing
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| 11. Demonstration Benefits Both Buyers and Sellers |
Chapter 11 |
The learning objectives for this lesson are to gain an understanding of:
- The four Cs of demonstration
- Handling prospective buyers and/or sellers
- The bluff
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| 12. Lofty Thought |
Chapter 12 |
The learning objectives for this lesson are to gain an understanding of:
- Reviewing your opponent and yourself
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| 13. Perceptions About Prices and Values |
Chapter 13 |
The learning objectives for this lesson are to gain an understanding of:
- Price in the play - Sellers
- Price in the play - Buyers
- Con artists
- Pricing
- Reconstruction and weighted cash flows
- Typical items for reconstruction
- Weighting the cash streams
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14. Who Ultimately Determines Value and Price |
Chapter 14 |
The learning objectives for this lesson are to gain an understanding of:
- The street scene
- The conceptual fallacy of fair market value
- Fair market value as influenced by majority leaders
- Criteria subsidizing a bank's interest in lending
- Establishing an offering price
- Industry rule-of-thumb ranges
- Allocation of purchase price
- The advisors influence in price allocations
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| 15.Structure of the Deal |
Chapter 15 |
The learning objectives for this lesson are to gain an understanding of:
- Sale of a sole proprietorship
- Sale of a partnership
- Sale of a Limited Liability Company (LLC)
- Sale of a corporation
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| 16.Comparing the Deal Before Signing |
Chapter 16 |
The learning objectives for this lesson are to gain an understanding of:
- The deal with pricing
- The deal with profiles
- Variances
- Strengthening for the day after closing
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| 17.The Contract and Lawyers |
Chapter 17 |
The learning objectives for this lesson are to gain an understanding of:
- A typical purchase-and-sale agreement
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| 18.Supplemental Agreements |
Chapter 18 |
The learning objectives for this lesson are to gain an understanding of:
- Security arrangements for deferred payments
- Consulting and non-competition agreements
- Employment contracts
- Pension plans in the sale of business
- Self-funded health benefits
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| 19.Obstacles and Concessions After the Contract but Before Closing the Deal |
Chapter 19 |
The learning objectives for this lesson are to gain an understanding of:
- Third parties
- Cold feet
- Financial terms that can't be met
- Business brokers
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| 20. Small Business in America |
Appendix A |
The learning objectives for this lesson are to gain an understanding of:
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| 21. Men Negotiate Differently Than Women |
Appendix B |
The learning objectives for this lesson are to gain an understanding of:
- Masculine interpretations of negotiations
- Feminine interpretations of negotiations
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| 22. Salespersonship |
Appendix C |
The learning objectives for this lesson are to gain an understanding of:
- The art of using sign language
- Salespersonship as a science
- Selling
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26. A vast majority of prospective buyers are "turnaround" prospects.
27. Which of the following, according to the author, are yardsticks used by buyers:
A. Terms of payment of balance of purchase price not to exceed 40% of current year profits
B. Look for ROI of 4% to 12%, assuming returns on equity (ROE) can be leveraged
C. Down payments should not exceed one year's profits
D. All of the above
