Forty five percent of new businesses fail within five years of opening. Only one quarter last longer than 15 years. That’s a big risk, and starting a new business from scratch also demands more energy, responsibility, financing and experience than many investors can fairly lay claim to.
Buying an established business is a safer bet. Its product or service has withstood the test of the market. Its brand is already well known. Startup time is minimal, and many if not all of the former owner’s previous customers come alongside the purchase. Financial lenders, which understand risk, are more willing to stake capital in an established business for these very reasons.
The advantages of buying an established business aren’t the sole force driving the success of Murphy Business. As one of the largest business brokerage firms in North America, their clients deal in virtually all types of businesses including healthcare, manufacturing, agriculture, distribution, food and beverage, retail, and franchises as well as commercial properties. And whether they’re selling a $200,000 sandwich shop or buying a $30 million medical device factory, Murphy Business brokers are driven to create the greatest possible value for their clients.
“I joined Murphy Business because I wanted to grow,” said Dan Bauer, who serves his clients in Minnesota alongside his partner Pat Steffl. Dan was the number one Murphy Business broker in 2018, and his was Murphy’s top office in North America last year. “I owned car washes until I became a business broker in 1997, and I specifically chose to work with the brokerage which rewards its members’ ambition the most. I also chose Murphy Business because it represents a network of 130 offices and 300 brokers nationwide. When someone hires one of us, they hire all of us, which alongside our access to businesses for sale outside of our system assures the best opportunities for our clients.
“We deal in privately held businesses. When you buy with Murphy, you do not inherit a board which may not share your vision and strategy. You also get exactly what you pay for. Our brokers implement several different valuation methods based on factors such as discretionary earnings, earnings before interest and taxes, and earnings before interest depreciation and amortization in order to pinpoint a business’s fair market value. Our opinions of value are each 20 pages long, and we’re happy to explain them in terms any layman can understand.
“That same attention to detail equally benefits our sellers, who walk a delicate line between parting with excessive equity and alienating potential buyers. As soon as we list a business for sale we feature it on 16 different websites, launch a direct advertising campaign, and begin calling investors who we know are in acquisition mode. Before long we have secured a buyer, at which point we stand by to facilitate every step of the upcoming transaction.
“Many of our clients start out as buyers and end up as sellers. A few years ago we helped a gentleman from the corporate world purchase a small manufacturing concern. He paid less for it than he made in one year, and he recently sold it for $5 million.
“We’re also here to help buyers who aren’t certain how to proceed. We advise sound decisions once we have better understood our client’s professional and financial goals, and we can refer the attorneys, accountants and bankers who are best qualified to further support them. We can even arrange for the former owner to stay on and train our client as they become familiar with their new industry. It’s all part of the Murphy team’s mission to make your life easier whether you’re buying into a business, cashing out of one – or both.”
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