The last couple of years have been tough on those of us who make our living selling small businesses. At my firm, 2008 was great, 2009 was bad and 2010 was abysmal.
While I would love to say that the business-for-sale marketplace is rebounding in 2011, I don’t sense much more than a faint sputter from my vantage point. Valuations are still down considerably compared to prerecession levels, credit markets are still tight, buyers are skittish and sellers are still coming to terms with the “new normal.” While things seem to be loosening up at the high end of the marketplace, the trickle-down effect has yet to hit Main Street (businesses with less than $5 million in annual gross sales).
I don’t remember signing up for this back in 2006. Opening a business brokerage firm seemed like a great profession for me and my husband; we could put our own entrepreneurial experience to use, as well as our business-school educations, and really make a difference in the lives of exiting business owners. And hey, the money didn’t seem too shabby either. What we didn’t realize was how heavily our fortunes would be tied to the overall economy, the small-business climate and commercial lending, otherwise known as the Bermuda Triangle of the Great Recession.
I’ve talked to several veteran merger-and-acquisition people over the last year or two, and they all have a “been there, done that” attitude about riding the deal-flow roller coaster. Many of them have anticipated market downturns and used the bad years to start ancillary services and complementary ventures, or write a book or two. In fact, they tell me this is to be expected and planned for, and is just part of the job. I just wish I’d known that at the beginning of 2009.
While my husband and I feel lucky to still be in business (I, too, am Staying Alive), we have had to regroup and find new ways to bolster our bottom line, which is how I came to have not one or two but three barter arrangements in place at my firm.
One is with our attorney. We got called into a deposition recently and racked up an unwelcome legal bill (is there any other kind?). Nothing to do with litigation is cheap, even if you’re not the one being sued and even if your attorney just sits next to you quietly for four hours. A partner at the law firm mentioned that he wanted to get the firm started on social media but didn’t know where to start. While I wouldn’t hang out a shingle claiming to be a social media expert, I know enough to get a small business set up with Twitter, Facebook and Hootsuite and to tie it all into a Web site and other marketing efforts. I also used to be a marketing manager at a midsize law firm in Seattle, so I have a good feel for working with attorneys. Saved: $1,100
The second arrangement is with my search-engine optimization specialist. I know the basics of S.E.O., but I meet with my S.E.O. guy once every six months or so to make sure that Google still loves my Web site. In addition to working for a Fortune 500 company, Russ is also finishing up his M.B.A. at the University of Arkansas. His focus is on entrepreneurship, and as part of a class project he started a Web-based company. In exchange for his S.E.O. services, he has asked me to be on his board of advisers and to help him with the exit portion of his business plan. Saved: $500
My last barter agreement is with a long-time friend and former co-worker who is starting a new career in coaching. She needed a guinea pig to test out her new skills, although she was instructed by the institute certifying her that she still needs to charge a reduced rate for her services. In exchange for helping her with a marketing plan for her new venture, I now have a shoulder to cry on and someone to help me recapture my enthusiasm for business brokerage and my work life in general. Saved: sanity.
Is anyone else bartering more than usual at your business?
Barbara Taylor is co-owner of a business brokerage, Synergy Business Services, in Bentonville, Ark. Here is her guide to selling a business.
Article source: http://feeds.nytimes.com/click.phdo?i=25e5d5796ebb8babbeae8080755cf2a1
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