In our line of work, we often guide clients through transactions culminating in joyous celebrations and resounding appreciation. However, the journey doesn't always proceed smoothly. Even the best transactions have setbacks. On occasion, one transaction may have several.
Learnings From the Field
Calculating a TAS Valuation
Recently, we received a call from a potential buyer within our industry, inquiring about our assistance acquiring several answering services. After careful deliberation, we made a strategic decision that will more closely align us with the interests of owners in the answering service industry. We chose not to offer buy-side services, and here's why:
** updated post with SBA changes on 4/2**
As of 4:00pm ET on 4/2, the SBA and participating lenders are planning on going live with the PPP tomorrow, 4/3. However, final guidance to banks has not been sent but has been promised by midnight tonight. Because of the high possibility of fraud, banks may choose to service current customers first, non-customer but known businesses next, and finally unknown businesses last. Therefore, we recommend you apply for the PPP loan with your current bank or financial institution.
A sample application for Payroll Protection Program can be found by clicking here
In the recent Coronavirus, Relief, and Economic Security (CARES) Act signed into law is $349B set aside for Small Business loans. Many call center and BPO owners have faced significant loss of business due to a myriad of effects the virus has caused to revenue streams, remote work capability, and loss of brick and mortar facilities to stay at home orders. This post will outline the key points of SBA's loan programs available and gives you resources to learn about and links to apply for loans.
The Long Explanation of Pricing in Call Center / BPO M&A
Each call center will have it’s own unique DNA, so this formula explanation is not a blanket for all centers but rather a general overview of how price is determined. Buyers are looking for balanced, heal- thy businesses that will grow over the short term (3-5 years), and allow them to position for another exit down the road. There are buyers for underperforming call centers as well, although those formulas are less able to be described in short as they are more situational and either relationship, geography, or client based in nature.
Of all the characteristics and metrics a Buyer will review when determining a purchase price, EBITDA (Earnings before Interest, Taxes, Depreciation & Amortization) is perhaps the most important.
All businesses sell. Whether it’s by retirement, generational transfers, or in good times or bad, 100% of business entities will change hands during or shortly after the lifetime of the owner. Those owners who plan and strategize for
an exit are far more likely to achieve higher value and leave the business in their preferred place than those with no plan.
In this blog series, you will discover what’s in a solid exit plan and how to begin writing it. Also, we will discuss the types of exits, types of buyers, and how maximum value is achieved. The last part of the series will be devoted to a Q&A from your input, so be sure to reply with any questions or comments you may have.