Effective legal counsel is a vital part of Entering, owning, and ultimately Exiting business ownership. Attorneys exist to serve your needs and will do so in fairness (including fees) if you will be specific in your instructions and monitoring of their work.

In exiting business ownership, William A. Neilson, Professor of Law at Loyola University School of Law in New Orleans, Louisiana provides good advice in using a closing attorney to handle documentation, escrow, and consummating the transaction for all parties. He says:

The closing attorney in a business transaction is very similar to a referee in a football game, he should not take sides, but he must make decisionspapering a transaction is not as simple as it sounds. Variations in how documents are structured and the words used explaining the transaction can take on monumental importance if later the parties disagree.

Once the closing attorney has been selected and his/her role has been agreed upon, the fee must be negotiatedand it should all be in writing. Mr. Neilson suggests: it is very difficult for a closing attorney to estimate the number of hours it will take to complete the transaction because the drafting of the documents many times brings up additional issues that must be finalized between the parties. Therefore, negotiating an hourly fee the closing attorney will charge seems fair to all parties. He additionally states....it might be possible to negotiate with the closing attorney a flat fee.

In an article Understanding Lawyers Fees by Marc Diener, Mr Diener advises clients should be specific in negotiating hourly, daily or flat fees with small minimum billing units. He cautions how the correct selection of a professional protects you in: double billing (two or more professionals unnecessarily jawboning), padded bills (keep accurate records of services youve requested), billing that is too general (ask for breakdowns), contingencies (sometimes a percentage is better), flat fees (when you need a standard service), retainers (assures your lawyers availability), and value billing (based on the value of the service)which is stylish these days.

Building trust with lenders: No transaction will be consummated without adequate funding. From the beginning of negotiations, issues must be documented in accordance with lending requirements and appraised values. The owner of the business should have secured an independent third-party appraisal prior to placing the business on the market. This will save additional expense of securing one and give you a sense of security in making your offer.

Building trust with the owner(s) of the business: A persons house is their castle, but its the business that pays for the castle. This is why business owners are emotionally attached to their business as well as financially concerned. Therefore you will need to build trust with the owner and his/her representatives before you will see much success in communications.

Identify your decision makers: Don't waste time and money of the owner in providing information and discussions with persons who cannot make your final decisions. The owner, like you, is spending money and will soon lose interest if he/she is not dealing with decision makers.

Be up-front about financial and geographical requirements, as well as your management abilities: Dont waste anyones time on anything that you cannot afford, is not within your personal requirements, or does not meet your ultimate earning goals. Voluntarily provide all of this information in your first meeting with the owner and his/her representatives.

Proceed in a timely manner: Lots of things are on the list of actions in the acquisition of a business. From the initial request for information, on-site visit, negotiations, LOI (Letter of Intent), deal structure, financing, due diligence, final purchase agreement and through the consummation, you will want to keep things on a dependable time table to avoid delays that result in suspicion. You may not be the only one considering this business and you will want to proceed timely so as to not spend time and money in an effort that is lost to someone else.

Avoid due diligence fatigue: You are entitled to verification of everything, however, make the investigation an effort that avoids repeated expenses and time consumed. Make a calendar for speedy performance by all and wasted time by none. Once an issue is settled, dont reopen it, or you may find the other party not willing to honor other commitments which were settled.

Confidentiality is a requirement: Propriety information and relationships is a significant part of what you are acquiring. Leakage could damage the value and/or expose you to liability.

Plan well for the days after purchase: Dont let anything happen during the process that will dampen the smooth transition to ownership. Your relationship with employees, suppliers, regulators, clients and former owner(s) must be maintained in an ongoing spirit of cooperation. Plan a detailed process, build confidences, and execute with precision to guarantee your success!

Why: When complaints escalate to anger they will be shared 2-3 more times than otherwise.

When: Its past the time they should receive resolution. Its time for you to hurry, but dont hurry the customer or client. Let them feel the resolution has been on their time and terms.

Who: There are at least 4 levels of customer or client disappointment: (1) concern;
(2) complaints; (3) anger; (4) legal action. Levels 1&2 should be handled by person(s) normally responsible. Beyond that, move it up to supervisors, manager, owners, legal department, etc.

How: First, show sympathy and stay calm. Help them know your concern and that they are entitled to share concern. Find the real reason(s)! Ask questions until youre dealing with facts as well as emotions. Create potential solutions & let them contribute. If emotions are high, allow time to pass as you reach agreement(s). Once agreed, a time for accomplishment and stick to it.

Leave them with a warm and fuzzy. Negative emotions need to be replaced with positive feelings which result in more business and strengthened relationships. If appropriate, send flowers, communicate with them more often, keep positive vibes in motion.

Until you sell a product or service, you dont have a viable business! Delivery and satisfaction are important, however, everything starts with selling which is a learned & earned skill.

Effective selling starts with a proper match of product or service to the prospect. Find their needs, tailor your product or service to meet the needs, and earn repeat business through dependability. Deal only with decision makers who can compensate your earned requirements.

To know requirements for business, listen twice as much as you talk. Ask for specific needs, goals, problems, even personal interests to make them more profitable and their life easier.

Ask for the order! If you have shown how you can meet their needs better than any competitor, ask for what youre entitled totheir agreement to allow you to produce. Follow through and follow up requires you to show more attention than when you were seeking the business. This is where you build trust which breeds more business and referrals.

We have moved from the X generation to the digital generation where employees are hopefully concerned for both the company and themselves. Recent developments with airline and other unions show growing cooperation from both employees & employers.

Employees will be more loyal if companies voluntarily show more concern for them. As in all relationships, all parties must know whats expected and must be provided tools (physical, educational, training, & emotional) to produce requirements.

Companies should define how meeting company goals also meet needs of employees. Meet with employees to better understand their needs and measure how they are being achieved.

Rewards are constructive, and consistency is important to employees. Recognize accomplishment. Spread positive news and minimize gossip. Share employee success with customers and news sources. Loyal, long-term employees are your most important ASSET.

The following two industry best selling publications; Buying and Selling Businesses and E⁴ are available by completing the order forms provided. Please e-mail the information shown on the form provided, or print it out, complete the form, and fax or mail it to ABC. The form for Buying and Selling Businesses can be found by clicking here. The form for E⁴ can be found by clicking here.