Business Brokers And Business NotesWhat Do We Offer Your Clients, The Business Sellers?One of the biggest observations we make at Grior Group, LLC is that many business brokers overlook what may be their greatest opportunity for making a huge sum of money while providing their clients the greatest level of service. Specifically, it is this: Many business brokers do not suggest to their clients that seller carry-back financing is a viable way to finance the sale their business. Too often, many concentrate only on acquiring a conventional bank loan or SBA loan for their clients. But, these same business brokers lose significant benefits by not offering their clients the possibility of selling their business using business notes. Think of it in this manner, creating a business note to facilitate the sale of a business is the same as providing owner financing. When a business owner advertises a business for sale and provides owner financing, they most often get afaster, sweeter sale. If the seller advertises that he or she will assist with financing, the business will normally sell faster and for a higher price. Additionally, our experience shows that typically when business sellers offer seller financing, they get more potential buyers. By “taking back” a note, sellers can usually offer buyers more affordable financing (especially, lower monthly payments). This means more buyers wanting to purchase the business. This gives the seller the ability to choose the right buyer from a larger pool of applicants. The bottom line for your clients is: increased income potential. Through the owner financing process, the seller receives a cash down payment and will receive note payments over time. We offer your clients the best opportunity to turn their small, monthly payments from a note they have taken back into a huge lump sum of cash they can then use to purchase another business through you.
What Do We Offer Business Brokers?We offer business brokers the opportunity to earn a great deal of money in two ways. First, our experience shows us that most business note holders who sell their notes invest the proceeds into another business opportunity. These note sellers have tended to continue dealing with the business brokers who originally helped sell their business. This means that those business brokers, who originally provided their clients with great service, were then rewarded with additional business when those same clients searched for other business ventures with the lump sum cash from their note sale. We are witnessing an uptake in this type of note selling-business buying cycle. Though the economy has taken a serious hit in the past year, this current economic situation also has a silver lining for many smart, seasoned business people with ready cash in hand. While many business owners have suffered great losses, many other business persons have been making a killing in the same, down economy. These business persons have been savagely opportunistic. They have been astute enough to recognize many great, bottom-feeding deals, where others have only seen failure. Again, many of these persons have owned notes and have sold them in order to gain ready cash to take advantage of these great deals. Bottom line: while this recent economy has been devastating for many business owners, for others, however, it has represented a great money-making feeding ground. The key to their success has been a source of ready cash. For note holders, their business note represents that cash. For the business broker who assists business note holders in liquidating their notes - to take advantage of fantastic deals, this economy can also represent an era of a lifetime. The keys for you, as a business broker when dealing with business notes, are: 1) providing the best, responsive service possible; and 2) assisting the business note holder in liquidating his or her business note, thus, “freeing” up a lump sum of money to invest in other business ventures. Additionally, business brokers who refer their clients holding carry-back notes receive generous referral fees. We pay you this referral fee each time one of your referrals sells a note through us. Therefore, let’s recap: you made a commission when you assisted the business owner when he originally sold his business. Then, you made a referral fee when you referred your carry-back note holder client to us. Finally, you will receive a another commission from the client when you assist him in buying another business. In this business selling – note liquidating – business buying process, you will have made serious money in all three portions, while providing your client with great service.
What Size Notes Do We Buy?At present, we normally buy notes up to $500,000. However, we can go higher as the situation dictates. Based upon the note’s underwriting factors, there really is no limit to how high we can go. We have a minimum discount of $2,500 per transaction. In Which Industries Do We Buy Business Notes?We work with all types of industries - bakeries, restaurants, dry cleaners, laundries, convenience stores, gas stations – you name it, we process business notes from that industry. We normally focus our attention on small and medium-sized businesses within those industries. Are The Notes We Buy Secured By Real Estate?Many are, however, many are not. As you may have guessed, notes secured by real estate are very valuable. For the most part, a note holder with a note secured by real estate will receive a larger lump sum payout, as opposed to one not so secured. Of course, this occurs because there is less risk of default when real estate is used to secure notes. However, our business notes are secured only by assets of the business. As you know, most businesses do not have very many tangible assets. This makes business notes, as a whole, much more risky than more other kinds of cash flow notes. Are The Business Assets Normally Appraised?No. We use the assets as security, but realize that their value will usually be less than the remaining balance of the note we are purchasing. Again, businesses normally have very few tangible assets. How Much Will Your Client Receive For Their Note?The offer depends on the note’s underwriting factors. The buyer's total down payment plus the sale of the note will usually be about the same amount as the seller would have received from an all cash sale of the business. Even though the note is sold at a discount your client will have about the same amount of cash as they would have had had they waited for an all cash business buyer. Do We Buy Full Notes And Partials?Yes, we buy both. It is to the seller's advantage to sell just part of the note if their cash needs are less than they would get from selling the entire note. Selling a partial is also advantageous if the note involves a balloon payment. We will gladly arrange a quote on a partial purchase. How Long Does It Take To Close A Business Note Sale?Typically, it takes about 15 business days after all necessary documentation has been received from the note holder. The note holder is key to completing this process in a timely manner - the sooner he or she forwards all documents, the sooner the transaction can close. The note holder must be responsive and cooperative. When Will You Receive Your Referral Fee?We will pay your referral fee when the transaction closes. How Much Is The Referral Fee?We provide a 10% referral of our transaction income. How Can You Submit A Note?Complete our Business Note Worksheet, then hit Submit. Subscribe to the
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