Sunday, February 19, 2006

Tell Me About Your Business

Without looking it up, can you correctly answer the following questions about your business:
  1. What were annual revenues for the last three years?

  2. How many customers were responsible for or made up 60% of your annual sales?

  3. Name your top ten customers?

  4. Can you categorize your revenue into major categories such as contract, recurring, Medicare, walk-in, word-of mouth, workers compensation? Do any categories contain a material risk for loss of either the associated revenue or for price cuts?

  5. What is normalized EBITDA?

  6. What was your average normalized EBITDA (or owner’s discretionary income) in the last three years?

  7. How much of your annual revenue is directly attributable to you and your personal / business relationships?

  8. Are any employees directly responsible for generating revenue? If so, would you agree they are key employees?

  9. Do you have non-competition agreements with key (revenue generating) employees?

  10. What is the date of your last business valuation? Do you think your business' fair market value has changed materially since then?

  11. If a buyer was considering a purchase of your business, the buyer would perform a due diligence. What do you think they will find ? And will their findings be both good and bad?

  12. Can you continue to grow your business? Do you want to? If so, how much will you have to spend to grow it?

  13. How old are you? What is your outlook on the future prospects of your business and industry?

1 comment:

Anonymous said...

Very Interesting. Can you tell me if there is a correct age to begin planning to sell my business?