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CHV Group LLC April 2018 Newsletter

CHV Group LLC      |      Buying & Selling     |     Advisory    |       Meet the Team

When is the Timing Right?
Timing – there is never a bad time to sell a Business from a market perspective, as long as your company is prepared to sell. However, as with all other market driven activities, economic factors are influenced by micro and macro-economic conditions as multiples and valuations are tied to the market conditions.

In a perfect world, the best time to sell a business is when the Business is performing well with future projections looking even better. The national economy being strong and the industry is attractive are also strong factors in timing.

Valuation is the when you go into the process of selling already knowing the value of your Business is the single most important factor. It helps for your planning purposes but also helps in the attracting and selecting the right buyer profiles. The value however should not be a mathematical exercise but verified with market data and industrial comparison. 

Third Party Sales is still the preferred choice of all Business Owners when selling their Business,and this applies to all sizes of businesses.

Sellers Note, can increase the value by as much as 20% as well as increase the potential to sell as it builds a relationship between Seller and Buyer, and a commitment from both is needed to make the deal and the future a success.

Working with a Business Intermediary, can have the same effect as a seller note, a faster sale as well as a higher price. Unless as an Owner, you have spare time on hand to sell, know your value and are happy with that one Buyer who really wants it, a Business Intermediary is not an expense, its an investment.

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Term Sheet, Letter of Intent and Purchase Agreement, are all progression in the closing of the deal. We prefer to work with a Term Sheet, that spells out the “terms” of the deal as price, structure of the deal, timing, and key employees can be binding to the terms contingent on uncovering’s in the due diligence process. The purpose of the term sheet is to avoid going deep into the process just to later agree to disagree. LOI, if needed and Purchase agreement merely solidify and extend the necessary details of the transaction. 

Succession Planning, there is great value and comfort for the Buyer when he can step into a Business and has a right hand that can run the Business from Day one. For the seller, select and train the person you most trust or hire someone external prior to put the Company up for sale.
Workplace Safety
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One of the major topics of discussion in the past year around Employees is the increase in workplace hostility. Workplaces should maintain as a safe environment for employees who want to grow and further their careers. Below is an excerpt of an article that we feel is very beneficial to all business owners and managers on how to build programs around eliminating employee bullying 

"If your company doesn’t have a program to eliminate employee bullying, you need to start one right away. Developments over the last several years guarantee that if you don’t do it, you face the possibility of paying a steep price in government penalties and employee lawsuits, and the stiff legal costs associated with them."

Read the full article by clicking the "Read More" link.
DOE and NAM Announce Sustainability in Manufacturing Partnership

Last Week, the U.S. Department of Energy (DOE) and the National Association of Manufacturers (NAM) announced the Sustainability in Manufacturing partnership. Through this partnership fostered by DOE’s Better Plants program, DOE and the NAM will work together to help U.S. manufacturers drive energy productivity improvements and accelerate adoption of energy efficient technologies. 

“Working alongside our private sector partners, we are driving cost savings and a stronger, more secure U.S. industrial base,” said Secretary of Energy Rick Perry. “The Department’s partnership with the National Association of Manufacturers will further spotlight industrial leadership and boost awareness of the resources across the DOE enterprise to boost manufacturing competitiveness through energy savings.”

Read the full article by clicking the "Read More" link.
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 (864) 641-8131
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(810) 494 7140