I Still Don’t Get It

For those looking to buy or sell a business this year, a new survey indicates that 2007 should provide some great opportunities.

The survey, administered by the International Business Brokers Association (IBBA), asked more than 1,900 members throughout the U.S. and 14 other countries about industry trends and their expectations for the economy. Fifty-three percent of the respondents indicated they expect the economy to improve this year.

“With this optimistic outlook, and the continuing trend of baby boomers looking to sell and retire, we see great opportunities for both buyers and sellers of businesses in 2007,” said Ron Johnson, IBBA Chair and President of Allen Business Investments, San Ramon, California. “The past few years have been active for business sales, and 87 percent of the survey respondents think business sales will increase in 2007.”

IBBA members also indicated they expect the manufacturing, distribution and services sectors to be most attractive to buyers. But, what’s “hot” in one area may be quite different in another. “Geography certainly has a lot do with the industry outlook, and what types of businesses are going on the market,” said Julie Gordon-White, a San Francisco-based IBBA member and Principal of BlueKey Business Brokerage. “In this region, the E-commerce and professional service sectors are really selling fast right now, but the hot industries can vary from region to region.”

While the type of business is important, a firm’s track record is also critical. “When buyers look at purchasing a business, they search out potential business opportunities that have a documented history of success,” said Scott Bushkie, IBBA member and President of Cornerstone Business Services, Green Bay, Wisconsin.

“Business owners should start preparing a business for sale years in advance to add significant value,” stated Bushkie. What are some of the most important things that a seller can do to make the business more attractive? The top three requirements cited by survey takers include:

1. Improving cash flow
2. Updating all documents and records
3. Determining the company’s actual worth

Johnson added, “It is amazing how often an owner doesn’t know their firm’s net worth. Often their gut feel for value turns out to be either too high or too low. If a buyer doesn’t properly look into a prospective business before purchase, things could get off to a rocky start.”

The survey indicates that, when looking to purchase a business, the three most important things a buyer should consider are:

1. Cash flow
2. Buying an established business with proven success
3. Employees and key staff

“These three things are primary indicators of a successful business,” said Johnson.

Buying or selling a business is in most cases a one time transaction, and is often the most important deal a business owner will ever make. “Individuals must be prepared and understand what it takes to make the process successful. If it’s something they don’t have experience in, they should seek the help of a professional business broker,” Johnson said.

Technorati Tags: buying a business

In a storyline reminiscent of Y2K, there is a little-known glitch on the way that could soon confound computer systems across the United States. The author of the problem isn’t some malware writer bent on causing trouble; the glitch is compliments of the United States Congress.

In 2005 when the Congress passed legislation to lengthen the U.S. observation of Daylight Savings Time (DST), the move was a benign effort to squeeze a little more light out of each of our days.

The legislation moved the start of DST forward in 2007 by three weeks-it will begin this year on March 11, rather than the traditional first Saturday in April. At the close of the season, DST won’t end until November 4, a week later than the traditional last Saturday in October.

The problem is that programs like Microsoft Outlook are programmed to make the time switch on the traditional April and October dates. So when the changes are made according to the new DST schedule, programs that depend on a computer’s internal clock-calendaring and scheduling applications, for example-won’t align with real time.

In addition, many calendaring applications don’t simply use the computer clock; they often set their own time flags to facilitate scheduling in multiple time zones. Simply adjusting the computer clock will cause an appointment that was coded for Eastern Standard Time to show up one hour off after the computer clock is updated with the new DST schedule.

If only the computer clock is updated and not the corresponding calendar items, appointments in the changed DST window for this year and future years are all impacted by one hour.

“This could have very real implications for business systems built around a basic calendar function,” said Jason Sharp, a technology consultant with C/D/H, a Michigan-based technology consulting firm that is working with clients to correct the issue. “On something as basic as Microsoft Outlook, IT people need to figure out how they are going to get all of their workstations, servers, and calendaring software updated to reflect the change.”

The DST issue goes beyond desktop computer systems and extends to things like mobile phones, security systems, and environmental controls. Modern buildings use computerized heating and cooling and access control that are often programmed around typical working hours, for example to unlock entrances, turn on lighting, or adjust heating. Another example might be sophisticated logistics systems that track just-in-time manufacturing processes into a state where parts deliveries may no longer align with workers’ scheduled shifts.

“A lot of people I’ve spoken with are simply not aware of the full impact of the changes that are coming in very short order,” Sharp said. “There are fixes for the problems, but people need to start thinking about how they are going to get them done.”

Technorati Tags: time change, y2k, information technology