Category Creative Business Services Posts

Small businesses sold up for 2nd year in a row – a trend continuing through 2019.

In 2018, BizBuySell.com, an online market for small businesses, reported a 4% increase in businesses sold since 2017, and a 31% increase over businesses sold in 2016. The number of businesses sold has been the highest the last 3 years since BizBuySell.com began tracking sales in 2007. This is attributed to a healthier economy and other factors discussed here:  Small Firms Put Out For-Sale Signs To learn more about National Business-For-Sale Trends and 2018 Transaction Activity read: BizBuySell’s Insight Report

12 Ways To Beat Capital Gains Tax In The Age Of Trump

If you don’t know where to put your capital gains, you’re not alone. This Forbes article provides a good framework of what is currently available. The rest is up to you and your creative advisors.  Many have found charitable giving as a solution with life changing impacts, with equal importance to the giver. Read the full article: 12 Ways To Beat Capital Gains Tax In The Age Of Trump

Including Employees in your Sale

I’ve been working with a seller who is starting to plan his retirement and is thinking about helping three of his key and longtime employees become owners of the company.  But he also wants to enjoy enough proceeds from the sale to enjoy that retirement!  So, we’re discussing three possible options, whereby 30% of the ownership would go to the employees and 70% would be purchased by an outside entity: The ESOP (30%), an Employee Stock Ownership Plan that has similarities to a profit-sharing plan, along with (70%) sold to an outside buyer. The Employee Stocks are held in a trust. A full purchase by an outside buyer, with select employees receiving 30% of shares in the company and who would also have employee contracts. A Joint Venture approach, with select employees entering into a purchase partnership with a Private Equity Group. There are always a number of ways to structure a transaction to make it work for all parties involved.  If you’re thinking about your retirement…give me a call.  We can figure your options out, together.

Deal Communication and Technology

Today’s technology has made it a lot easier for M&A professionals. Information about buyers and sellers is readily available online, which allows buyers to find and act on deals all across the country and from under the radar sources which weren’t available before.   If one is heavily relying on technology to assist in the deal, it can slow the process down and increase the amount of time it takes to do a deal.  Even when today’s technology can shorten the time period to perform the due diligence process, it can be difficult to develop a relationship and an understanding of the parties involved between buyer and seller when much of the communication is done by email. Example: When there are endless updated requests for Trailing Twelve Month revenue updates and the use of virtual data rooms and using them without ever meeting the other side in person, makes it difficult to interpret the right context and cultural insight on both sides. “That means you end up talking to the other side and using that conversation to really try to understand the other side’s industry and their place in it.   Decisions are data driven and not enough time is spent on the focus of the relationship side on the negotiations.” Misunderstandings abound when extensive email communications are the mode of exchanging information to the other side. One can’t help but think that the process would be faster and more straight forward if more in-person meetings were integrated into the process. Today’s younger folks seem less likely to value the face to face interaction and some choose not to meet anyone at all. There are times the face to face meetings are not necessary, but we have to remember that many deals require collaboration and partnerships and you need to get to

15 Surprising Real Estate Trends Impacting 2018

This Forbes article has a focus on 2018 real estate trends.  Creative Business Services tracks industry trends that assist our client, investors and sellers to make better decisions at the right time.  You will notice in this article, redevelopment plays a pinnacle roll in many real estate trends.  Change can be good if you’re analyzing the cause and effect.  Identification of business professionals discerning in your behalf can bring value in ways you may not have considered.  Be flexible and be ready by surrounding yourself with knowledgeable business relationships.  Opportunities do not wait on anyone’s busy schedules. Read the full article: 15 Surprising Real Estate Trends Impacting 2018

The Future of Talent Development

The short article, The Future of Talent Development, is very informative for any organizational leader or an aspiring leader. I took three very important sentences from the article that I have either witnessed or been challenged with in my career. “The growth and development of people is the highest calling of leadership.” “The future of talent development is developing the entire person.” “You must develop an employees soft skills as well, which enables them to live a more fulfilling life.” Throughout my career of Manufacturing Leadership and Consulting it has become very evident that leadership of any kind requires understanding and adapting to the workforce society has presented you. Unlike in the past you could motivate workers differently because of the work ethic and loyalty that existed during that timeline. Today, the employees no matter what level within an  organization have numerous aspects of their life (work and personal) playing out throughout their career. It has become apparent to me that when an employee is in the work setting, their attention span or focus is challenged with the many issues (work and personal) that are part of their daily life. Why the need for all organizations to truly sympathize with the environment each employee faces and to develop the whole person they employ. As much as this may go against the culture, it must occur to get more leadership within your organization. Please the full article: The Future of Talent Development  

Tax Legislation Impacts the Next Move

The current Tax Proposal Bill could have huge impacts on companies deducting corporate interest.  The proposed bill will only allow companies to deduct interest up to 30%.  This will be a big change from the current 100% deductibility of interest. Private equity firms rely on leverage and would be hurt by not being able to deduct the interest from their companies’ taxable income.  Leveraged buyouts rely on a tax shield to embellish their returns.  Also, this will be huge for non-traditional bank lenders, who will have to figure out new ways to conduct business. Conversely, this may not be so bad to have less reliance on leverage.  The tax law could force private equity firm to focus more on making companies better rather than on using leverage for their returns.  Lately, the industry has been more focused on making improvements rather than financial engineering. It also seems that portfolio companies could have more money as a result of the corporate tax cut from 35% to 21%.  This could make these companies more competitive globally. Read the full article: 2018 Forecast: 5 Major Trends Hitting the Middle Market

Achieve What You Want With the Right Plan & the Right Talent

I pulled out a few notes from the article I would like to comment on: “You can achieve anything you want in your business and life with the right plan implemented by the right talent.” “Right plan has a vision, goals and an action plan.” “The talent on your team is based on the strategy of the organization.” “The plan drives what talent you need to achieve it.” “The team that has the right people in the right positions to get it done.” “Without strategy your talent is not focused and without talent your plan is not implemented.” In my years in manufacturing we did it the complete opposite and thought by bringing in the talent they could help construct the strategy and eventually implement it successfully. As I think back, unless you have the vision, goals, and action plan strongly in place, how can you actually find the talent to carry out the strategy. Many organizations struggle with spending year after year looking for talent and creating a strategy, but are unsuccessful in their attempts because they did not plan which led to profits. Please read the full article: Achieve What You Want With the Right Plan & the Right Talent

The 7 Habits: Sharpen the Saw

We are all aware of Stephen Covey and the impact he had on many of us in the business world. His masterful writings of the Seven Habits of Highly Effective People have been read and implemented wholeheartedly into so many lives. No matter how old his writings are they are still true to form today! The article summarizes how your Physical, Spiritual, Mental, and Social/Emotional aspects of our lives impact the outcome and result not to mention each are very much connected. Please read full article, The 7 Habits: Sharpen the Saw.

The Bogus Trade War Victory is Bogus for the Dairy Industry

The Canadian Trade War “Victory” Claims for U.S. Dairy are Bull Flatulence! “Victory” shouts from the likes of President Donald Trump, Wisconsin Governor Scott Walker and the dairy co-op lobby — National Milk Producers Federation are hollow! The recent United States Mexico Canada Agreement (USMCA) accomplishes virtually nothing for U.S. Dairy Farmers and processors, in terms of dairy exports to Canada.  The deal only allows for microscopic volumes of dairy exports to be allowed to enter Canada.  The current deal is for 6 years (2025).  The percentage of our fluid milk production goes from 0.0003% to 0.002% over 6 years to Canada.  Those are the same numbers for our Cheese too. Mexico’s 25% tariff on cheese remain in effect.  So, in the short run US dairy trade to Mexico is worse off than it was a year ago.  The European interests are keenly aware of this opportunity and have recently concluded a trade deal with Mexico that should offer Europeans increased access to Mexico’s dairy markets. Our dairy industry is currently experiencing financial difficulty as it is and this Trade Deal offers no help at all.  There will be considerable political blow-back from this in the very near future. So the cries of “Victory” are Bogus!

Sources of Existential Angst

Suicide is not a topic any of us really want to talk about, but I found this article that attempts to take on the subject. Most if not all of us have been touched by suicide. These are what I believe important statements within the article: I will start with Faith, Family and Friends! A satisfying and purposeful life The digital age has removed any barrier to entry when it comes to making one’s voice heard Rather than showing the heights to which a person may soar, it shows the depths to which a person can descend You can’t help but wonder how your own life measures up. More and more we see ourselves from outside ourselves One’s “personal photo album” is open to hundreds of onlookers via social media. There is more pressure to perform – to edit the film of one’s life to show only the best Distorting the contemporary landscape into something more threatening, more dangerous – more compelling – than it is! You can pretty much do whatever you want, short of breaking the law, and endure minimal social repercussions Social media exposes us, in full stylized, living color, to every other lifestyle option as well This all leads me back to Faith, Family and Friends, Values, Traditions, and Practices which helps me withstand social and life challenges that are forced upon on me every day. Please read full article Sources of Existential Angst