Sara Burden, President of Walden Businesses, is a founding member of the Cornerstone International Alliance. The Alliance’s diverse membership creates a global footprint that is unmatched in the lower middle market. That, combined with members’ experience, resources and collaborative efforts are the driving force behind this continued level of success. To date, members have completed more than 3,750 business transactions.
Have you ever had a deal blow up at the eleventh hour because your client got cold feet or found fault with the deal terms for seemingly irrational reasons? If so, you have likely witnessed the disruptive effects of unaddressed unpleasant feelings and concerns. All change, even when it results in a huge payout, involves loss. Exiting business owners lose a key part of their identity, long-standing relationships, familiar routines, the sense of doing something well and being recognized for it, and more. They also face tough choices about what to do with the rest of their lives and concerns about how their newly liquid wealth will impact their family and other relationships. This is a lot to deal with. One way clients cope is by trying not to think about it. Instead, they focus on the business of getting the deal done. Meanwhile, advisors often have their own reasons for focusing on getting the deal to close. The unfortunate outcome can be that business owners’ unaddressed mixed feelings get acted out in the form of inexplicable and counter-productive behavior as closing approaches. Advisors who have not had psychological training often try to address last-minute objections with rational counter arguments. This can make things worse, especially if the client begins to feel pressured. Most experienced advisors have observed this pattern. The question is what to do about it. My suggestion is to encourage your clients to use a professional coach to help them anticipate the feelings, concerns, and choices they will face during the exit process and to begin addressing them even as they proceed with the other steps needed to produce a successful exit. Eventually, providing clients with this type of support may come to be seen as a “best practice.” Meanwhile, advisors who adopt the practice will likely gain a competitive advantage, see deals close more smoothly, have happier clients, and receive more referrals.
PRESS RELEASE – SOLD by Sara Burden and Walden Businesses, Inc. is pleased to announce its North Atlanta client, Express Employment Professionals, completed a successful sale to Category 5, LLC. Walden initiated this transaction and acted as advisor to the seller. Express franchise owner, Rodney Moore, shared: “One of the best business decisions I made was to hire Walden Businesses to represent my company when it was time to retire. From the early conversations and first meetings, Sara and her team were true professionals with a tireless approach to making the sale. She excelled in her ability to communicate effectively to myself and to potential buyers with a positive spirit and attention to detail. Her experience and wisdom of the market helped us receive the optimum value for our business.” Express Employment Professionals is one of the top staffing companies in the US and Canada. This award-winning Alpharetta franchise has repeatedly been recognized in the top 25 volume Express offices in America.
PRESS RELEASE – SOLD – Sara Burden and Walden Businesses, Inc. is pleased to announce its client, AF&S Products & Services, Inc., completed a successful sale to McMaverick, Inc., dba Apex Solutions. Walden initiated this transaction and acted as advisor to the seller. AF&S Products & Services, Inc. is a Service-Disabled Veteran-Owned Small Business (SDVOSB) formed in 2005. AF&S distributes janitorial and housekeeping cleaning and maintenance products; textile products such as sheets, uniforms, etc.; and equipment such as buffers, scrubbers, hangar sweepers, etc. used in janitorial and sanitation environments. The products are sourced from high quality manufacturers and are cost effective for the Company’s clients. The customer list is exclusive to government facilities through GSA contracts. #mergersandacquisitions #broker #businessesforsale AFS-Press-Release-CC-pdf-sent-9.28.22
When your business owner client decides to sell, there’s a unique, uncommon opportunity for you as a wealth manager to provide an incredibly valuable service to your clients while also growing your assets under management. As a wealth manager, you play a critical role in the lives of your clients. It’s not a stretch to say that their future is literally in your hands. They rely on you to ensure their retirement is going to look a particular way. For business owners, exiting their business is almost always a key component of their retirement plan. The sale of a business may be the biggest liquidity event in their lives. As a wealth manager, you have the opportunity to help figure out exactly how to make the most of that money for their retirement — or for any other purposes they may have in mind. There’s a huge opportunity here — Baby Boomers are beginning to retire in droves (and will keep doing so for at least a decade). There are many business owners retiring right now who will need your help. Here’s what you need to know about exit planning and the role you’ll play in it for your business-owner clients. Figuring Out The Number The first thing you’ll be doing for your business owner clients is helping them figure out the number: the amount of money your client needs to get out of the business when they exit. Usually, retirement is the goal, but there are other potential goals. Maybe they want to open another business or start a non-profit. Maybe they want to engage in some philanthropy or set up a trust for their family. Whatever the case, you play a major role here. As exit planners, we need you to help us figure out how much they need and then do a net present value of the amount. We can then subtract other assets that are available for whatever they have in mind and come up with the number. Valuing the Business Once we have the number, then we have to figure out how much the business is actually worth in today’s market. That’s something the exit planners and business valuation experts in your network will help define. When we have a clear idea of how much our mutual client can potentially make from selling their business, we can then compare it with the number. The difference between the number and the current value of the business will tell them what they need to do next. They’ll need your services for this. If there’s a shortfall, you’ll have to talk to them about what to do. Do they want to reduce their standard of living for retirement? Work a little longer? Increase the value of the business and then look at a potential sale in a few more years? Whatever the case, they now have a plan in place — and they’re looking to you to implement key components of that plan. And of course, there are opportunities for you as well. Opportunities for Wealth Managers One of the first things exit planners will do is to have clients complete a financial plan for the business owner and other stakeholders — you’ll be responsible for your clients’ financial plans and potentially those of their key employees. You also have the opportunity to capture more assets under management. And, as the exit planning moves ahead, there are other opportunities: for example, 401(k) or IRAs and other assets can be transitioned to your management. Another thing to consider is that, once you become an advisor to a business owner, you gain potential access to their network. They might refer you to key people in their organization who also need your help — not to mention their family and friends. For years after the exit, you’ll be managing their assets (and likely managing those assets for their family after they pass). All this because you had a seat at the exit planning table and helped your clients through the process. The Advisor’s Edge — The Education You (and Your Clients) Need The Advisor’s Edge is a library of content that you can use to educate potential and existing clients on exit planning — and you can use it to educate yourself as well. Instead of giving every client an individual presentation (which you probably won’t get them to schedule anyway), you can send them content that answers their questions and educates them. Or you can bolster your social media and marketing efforts with short videos that build the case for working with you and trusting your processes and network. The Advisor’s Edge includes documents and videos that explain just about every aspect of what CEPAs, financial professionals, and business advisors do in a way that’s clear and highly professional. The content is extremely high quality and has been created by top professionals in exit planning and value building. This means your potential clients will see you not just as a resource and someone they can trust, but as someone who is a true expert, who really knows what they’re talking about.
As an advisor, your role is to help clients prepare to exit their business, yet many people resist thinking about the future because it involves so many unknowns, decisions, and choices. And emotions typically complicate matters further, sometimes derailing the process altogether. Here are some questions that can help you establish rapport with your clients, learn more about their concerns, and move the conversation forward. How are you feeling about your work/profession/business these days? Which aspects of work are you still enjoying, and which are you ready to leave behind? Do you envision retiring from work at some point, or are you contemplating an encore career? What part of planning for your future feels most challenging? How do you imagine your life in retirement will be different from how it is now? What process are you using to figure out what you’ll do next after you retire? What would you like to see happen with your business long term? What options have you considered for the transfer of your business? What steps have you taken to make your business more attractive to a potential buyer? What are your concerns about transitioning your firm to new ownership? What would be your ideal scenario for transitioning out of your company? What topic(s) have we touched on today that we should put on our agenda to revisit? So, what happens after you pose a few of these questions and your clients open up about emotional matters? Remember, the most helpful thing you can do is to listen attentively. You’ve created a valuable opportunity for them to talk about things they may not share with other advisors. Here are some tips for managing the conversation when clients raise emotionally loaded topics: Don’t try to “fix things” by immediately offering suggestions. Doing so sends the message that you’re uncomfortable hearing their concern. You can offer suggestions but do so later. Don’t say anything that conveys the message that their feeling or concern is unwarranted. “There’s really no need to feel that way” or “I’m sure it will be just fine” may sound reassuring to you but could be experienced as dismissive by your client. Don’t immediately offer a logical counterpoint to your client’s emotion. Remember, feelings don’t have to make sense; they’re “as is”. Put another way, if feelings made sense, they would be thoughts. People report concerns and characterize their feelings differently from one another, so it’s in your best interest to seek amplification and clarification by inquiring as follows . . . “I want to make sure that I understand exactly what you mean by ___. Can you tell me more?” “People sometimes mean slightly different things when they talk about ___. What does ___ mean for you?” “Before I suggest anything, I’d like to learn more about it from your perspective.” It’s possible that during early conversations your client may hint at mixed feelings about exiting their business. That’s perfectly normal, but you need to bring it out into the open. You want to foster an atmosphere such that your client keeps you apprised about where they’re at. If they keep their ambivalence to themselves, it has greater potential to blindside you and complicate the sale. You can say: “In my experience, it’s normal to have some mixed emotions about selling. Those thoughts may not always be top of mind, but when they do pop up let’s be sure to talk about them. Believe it or not, they can help inform our process and alert us to aspects of the sale that are important to you.” You may also find that your client is overly risk averse. If so, consider saying the following: “Our work together won’t be comprehensive if we only plan for what could go wrong. That’s just half the equation. It’s fine to be conservative and err on the side of caution, but to be truly realistic we should also consider a range of possibilities both good and bad.” Author’s Note: The concepts in this article are derived from Robert Leahy’s book, Overcoming Resistance in Cognitive Therapy. New York: Guilford
For five decades, the southern United States has been an attractive location for automakers to open plants thanks to generous tax breaks and cheaper, non-union labor. However, after decades of failing to unionize automakers in the South, the United Auto Workers dealt a serious blow to that model by winning a landslide union victory at Volkswagen. In an effort to fight back, three southern states have gotten creative: they passed laws barring companies from receiving state grants, loans and tax incentives if the company voluntarily recognizes a union or voluntarily provides unions with employee information. The laws also allow the government to claw back incentive payments after they were made. While these laws are very similar, each law has unique nuances. If you are in an impacted state, you should seek local counsel. In 2023, Tennessee was the first state to pass such a law. This year, Georgia and Alabama followed suit. So why this push? In 2023, the American Legislative Exchange Council (“ALEC”), a nonprofit organization of conservative state legislators and private sector representatives who draft and share model legislation for distribution among state governments, adopted Tennessee’s law as model legislation. In fact, the primary sponsor of Tennessee’s bill was recognized as an ALEC Policy Champion in March 2023. ALEC’s push comes as voluntary recognition of unions gains popularity as an alternative to fighting unions. We recently saw this with the high-profile Ben & Jerry’s voluntary recognition. Will this Southern strategy work to push back against growing union successes? Time will tell. Brody and Associates regularly advises its clients on all labor management issues, including union-related matters, and provides union-free training. If we can be of assistance in this area, please contact us at info@brodyandassociates.com or 203.454.0560.
Almost since time began, the nimble small business has been axiomatic. Large corporations are like big ships, the common knowledge goes. They take a long time to change direction.
I once had the thrill of interviewing Jerry West on management. He was “The Logo” for the NBA, although back then they didn’t advertise him as such. Only the Laker followers knew for sure. In 1989 the “Showtime” Lakers were coming off back-to-back championships. Pat Riley was a year away from his first of three Coach of the Year awards.
Can you Offer Too Many SKUs to Your Customers? The short answer is YES! A SKU, or Stock Keeping Unit, defines each different product version that you sell and keep inventory of. There may be different SKUs of the same overall item based on size, color, capacity (think computer or cellphone memory), features, and many other parameters. For build to forecast businesses, that number of variations can quickly explode and become difficult to manage. Your customers are busy and want ordering simplified. Of course, they may need (or want) more than one variation of a product. That is reasonable and a common aspect of business – one size does not fit all! But there is a point where too offering too many SKUs is not value added either for your customer or your business. In his April 30, 2013 article “Successful Retailers Learn That Fewer Choices Trigger More Sales” in Forbes, Carmine Gallo discusses his experience and a study about “choice overload” by other authors. He writes about a retailer that “has discovered that giving a customer more than three choices at one time actually overwhelms customers and makes them frustrated…when the customer is faced with too many choices at once, it leaves the customer confused and less likely to buy from any of the choices!” Choice overload is well-documented in consumer studies but can apply in B2B as well. While customer satisfaction is important, another key concern is the often-hidden costs associated with a business offering and managing a large number of SKUs for a given product type. These costs include holding inventory, S&OP (Sales and Operations Planning) team time, small production runs, and scrapping inventory. Holding inventory takes up space, which may come with a cost or utilize racks that could be used for other products. Scheduled inventory counts take up employee time and may result in blackout periods when the warehouse is not shipping product. The more SKUs there are, including extra SKUS, the greater the potential impact. The Sales team’s forecasting and the Operations team’s purchasing reviews that are part of the S&OP process can occupy more of their valuable time if they need to consider these times. If small orders or forecasts require a new production run, this could be costly and create excess inventory. Whether from this new production or past builds, eventually it will make sense to write off and scrap old inventory, another cost impact to the company. How do you know which SKUs to focus on if you wish to look at reducing your total number of SKUs? Start by examining SKUs that have: Low historic sales over a period of time Small variations between SKUs that customers do not value Older technology or model when newer option SKUs are available This requires a true partnership between Sales and Operations. It starts with educating both teams on the costs involved – neither group may be aware of the money and time impact to the company. Periodic (such as quarterly) reviews of SKUs that meet the above descriptions should become a fixed part of the calendar. A review of the data and other available for sale options should result in the identification of SKUs which may not be needed. At that point, it is helpful to have a customer friendly EOL (End of Life) Notice process by which you inform customers of last time buy requirements for this SKU and alternates available. It is usually best to provide some time for the last time buy in the interest of customer satisfaction, although that may not always be necessary. At a company that designed and sold electronics, a robust SKU rationalization process was implemented to help address these issues. A representative from the Operations team analyzed SKUs that met a version of the above criteria and suggested candidates for the EOL process. Next, a member of the Sales team reviewed them and, where appropriate, issued product change or EOL notices to customers, providing them time for last time buy orders when needed. These steps helped reduce the work involved in maintaining these SKUs while not leading to any customer complaints. A final note – sometimes it makes sense to continue offering low selling SKUs – to support customers buying other items (hopefully in larger quantities). It may be worthwhile to encourage them to keep coming back to you for all of their product needs and this may be a way to accomplish that. But it helps to understand that this is truly the case and not assume that this customer would not be equally happy with another, more popular, SKU. Steven Lustig is founder and CEO of Lustig Global Consulting and an experienced Supply Chain Executive. He is a recognized thought leader in supply chain and risk mitigation, and serves on the Boards of Directors for Loh Medical and Atlanta Technology Angels.
When it comes to careers, business owners are a minority of the population. In conversations this week, I mentioned the statistics several times, and each owner I was discussing it with was surprised that they had so few peers. According to the Small Business Administration (SBA), there are over 33,000,000 businesses in the US. Let’s discount those with zero employees. Many are shell companies or real estate holding entities. Also, those with fewer than 5 employees, true “Mom and Pop” businesses, are hard to distinguish from a job. The North American Industry Classification System (NAICS) Association, lists businesses with 5 to 99 employees at about 3,300,000, and 123,000 have 100 to 500 employees (the SBA’s largest “small business” classification.) Overall, that means about 1% of the country are private employers. Owners are a small minority, a very small minority, of the population. Even if we only count working adults (161,000,000) business owners represent only a little more than 2% of that population. So What? Where am I going with this, and how does it relate to our recent discussions of purpose in business exit planning? It’s an important issue to consider when discussing an owner’s identity after transition. Whether or not individual owners know the statistics of their “rare species” status in society, they instinctively understand that they are different. They are identified with their owner status in every aspect of their business and personal life. At a social event, when asked “What do you do?” they will often respond “I own a business.” It’s an immediate differentiator from describing a job. “I am a carpenter.” or “I work in systems engineering,” describes a function. “I am a business owner” describes a life role. When asked for further information, the owner frequently replies in the Imperial first person plural. “We build multi-family housing,” is never mistaken for a personal role in the company. No one takes that answer to mean that the speaker swings a hammer all day. Owners are a Minority We process much of our information subconsciously. If a man enters a business gathering, for example, and the others in the room are 75% female, he will know instinctively, without consciously counting, that this business meeting or organization is different from others he attends. Similarly, business owners accept their minority status without thinking about it. They expect that the vast majority of the people they meet socially, who attend their church, or who have kids that play sports with theirs, work for someone else. There are places where owners congregate, but otherwise, they don’t expect to meet many other owners in the normal course of daily activity. This can be an issue after they exit the business. You see, telling people “I’m retired” has no distinction. Roughly 98% of the other people who say that never built an organization. They didn’t take the same risks. Others didn’t deal with the same broad variety of issues and challenges. Most didn’t have to personally live with the impact of every daily decision they made, or watch others suffer the consequences of their bad calls. That is why so many former owners suffer from a lack of identity after they leave. Subconsciously, they expect to stand out from the other 98%. “I’m retired” carries no such distinction. This article was originally published by John F. Dini, CBEC, CExP, CEPA on
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