Overview

This document contains expanded explanations for the questions presented in the BESWeb Questionnaire worksheet. For help accessing the worksheet, see Performing an Evaluation.

Explanations of the Questions

1) Do you want to normalize earnings? Your answer determines which earnings worksheet you will use. Select No to use a simple worksheet for current earnings.

Explained in Performing an Evaluation. See Earnings.

2) Select the industry for the business you are evaluating.

Select the industry that best describes the business you are evaluating. If the business does not belong to any of the industries in the list, choose the first option, None of These Industries Apply.

3) What would an absentee owner have to pay a manager annually, including all benefits and bonuses, to run this business profitably?

Be sure that the annual salary quoted here is not for slave or incompetent labor. A qualified manager will be spending as many hours as the current owner spends, and will have to be paid accordingly. Include all extra costs and benefits in the total. Use the following sources for information:

The owner

Employment agencies

Help Wanted ads

4) How much cash do you expect as a down payment?

Use the following guidelines:

Ask the owner and enter that amount.

If the owner or the owner's representatives do not have a specific requirement, enter the estimated market value of the assets.

5) What is the current market value of OWNED equipment and fixtures?

Do not exceed original cost when adding salvage value. "Floor planning" is not owned equipment - actually leased. Use the following guidelines:

Consult used equipment dealers for current wholesale prices based on actual physical condition, age and local market demand.

Consult local auctions, trade magazines, etc.

Ask the owner. Caution: This is generally the least accurate source of information.

6) What is the current market value of any leasehold improvements?

Buyers will not pay for used leasehold improvements if they can get a new "build out" for free in a similar space. If you didn't pay for improvements - neither should the buyer. Assuming the current owner paid for leasehold improvements and the local lease market is not providing spaces built to the tenant's specifications, use the following schedules:

Long Lived Improvements (10 to 25 year life). Walls, electrical wiring and plumbing can be valued at the original cost of installation with no deduction for depreciation. Inflation rates will compensate for depreciation.

Intermediate Lived Improvements (5 to 10 year life). Signs, water heaters, air conditioners, air compressors furnaces, etc. are capital improvements that have a definite lifetime. Use a "straight line" depreciation schedule based on actual useful life.

Disposable or fashionable (0 to 5 year life). Carpeting, blinds, draperies, etc. are subject to rapid wear and fashion trend and will be worth:

– 75% of original cost if in new condition

– 50% of original cost if in good condition

– 25% of original cost if in fair condition

– 0% of original cost if in worn condition

7) What is the market value of included vehicles?

There are three good sources for vehicle price information:

Blue Book value. This guide is available at many book stores for a nominal fee and is extremely reliable.

Classified ads. Many local publications and newspapers advertise vehicles and the average price from a number of ads will represent the prevailing market price.

Depreciation schedule (minimum value is 20% of original cost)

8) What is the average daily value of stocks, supplies or merchandise for consumption or resale?

Every business has some inventory of stock for internal use or products for resale. The actual value of stocks or inventory is usually determined by a physical inventory completed the day the business sale is consummated. Use the following sources for information:

Have a professional inventory service determine market value.

Use last years tax statement to find your "ending inventory" and "beginning inventory". Be careful: many people make year end adjustments to inventory levels for tax purposes - this question is looking for the value on a "normal day".

Estimation. Ask the owner, purchasing manager or person responsible for stocks.

9) What will be the cost PER SQUARE FOOT PER MONTH including the lease rate and all related fees on the average over the next three years?

This figure will come from conversations with the landlord.

10) Give the current lease rate per foot for a similar space down the street on the same side of the street.

When researching comparable lease spaces, try to find ones with similar esthetic appeal, road access and exposure. Favorable lease terms are considered an asset and worth money to a buyer.

11) Give the current lease rate per foot for a similar space on the other side of the street.

When researching comparable lease spaces, try to find ones with similar esthetic appeal, road access and exposure. Favorable lease terms are considered an asset and worth money to a buyer.

12) If any leased/purchase equipment can be transferred, what is the difference between market value and current payoff?

Read the fine print in the lease contract! Lease / purchase agreements are usually not the same as a purchase agreement with installment payments. The fundamental question is - who will get the equity and how much if the item is sold at any time?

If the current owner's terms can be transferred to a new owner at a nominal cost the lease may have an asset value.

If the item can be purchased during or at the end of the lease term this item may have an asset value.

If the item has no ownership available there is no asset value!

13) What is the current market value of any TRANSFERABLE licenses, rights or patents that will be sold with this business?

If the right cannot be transferred legally - there is no asset value! If replacement or residual value cannot be determined because this item is a product of creativity and therefore unique - do not attempt to place a value without professional research assistance! Use the following criteria to determine license or permit worth:

Similar permits are currently available and these permits have no expiration date: use the current replacement cost and add acquisition costs.

Similar permits are currently available and these permits have a definite expiration date:

– Enter the fee to obtain this legal right

– Divide cost by months permitted for use

– Equals value per month

– Times months held since issuance

– Equals consumed value

– Enter the fee to obtain this legal right

– Deduct consumed value

– Equals current residual value

Information or data bases are generally valued by:

What was the original cost to create it?

What would it cost to replace today?

Where else is this data available at what cost?

What percent of revenue uses this data directly?

What percent of data is annually obsolete?

Licenses, patents, unique permits, dealerships, copyrights, and similar legal rights are valued by security and income generation. Price can be determined by the following methods:

Ask the seller what they will take to release all and part of currently held rights.

Research the local market for recently sold permits or rights and use the trend of prices

Find two (2) or three (3) direct competitors and ask what they would take to sell all and part.

14) What were gross revenues over the past twelve months?

Use the last 12 months - not the last fiscal year! Do not include unusual income or income from sources that are not included in this sale!

15) What were gross revenues for the most recent fiscal year?

Obtain a copy of the most recent tax return or financial statement. Usually extraneous income is listed as "other income" or "sale of assets". Do not include this income! Be sure that the revenue reported was actually generated by the business being sold. Buyers and the IRS do not accept two sets of books.

16) What were gross revenues for the fiscal year preceding the most recent one? Enter zero if the data is not available.

Obtain a copy of a tax return or financial statement from one (1) fiscal year prior to the last. Usually extraneous income is listed as "other income" or "sale of assets". Do not include this income. Be sure that the revenue reported was actually generated by the business being sold. Buyers and the IRS do not accept two sets of books, and don't trust what "second sets of books" read. If its not absolutely legal don't use it!

17) What percentage of direct and indirect competitors have survived the past four years?

Some sources for this information:

The owner

The company marketing manager

The company sales manager

A purchasing agent from a client company

Secretary of State

Chamber of Commerce

18) What is the MINIMUM rate of annual return a buyer would require to assume this risk?

Go down this list until the criteria describes this business. Do not quote sale or special low rates.

The business shows consistent growth over many years, with no management required, and is in a proven and very stable industry: use the highest interest rate on local credit cards.

The business shows growth almost every year, with little management required, and is in a proven and very stable industry: double the current interest rate for a fixed rate 30 year conventional mortgage.

The business shows profits, is in a good industry and requires management; however, it hasn't been established very long: double the current interest rate for vehicle loans through a financial institution.

The business is not consistently profitable, requires extensive management or is not proven over time: double the highest interest rate on local credit cards.

The business has been unprofitable, the owner controls all functions and isn't established: triple the highest interest rate on local credit cards.

19) What is the MAXIMUM annual rate of return a buyer would expect to assume this risk?

The best source for this information is a "Venture Capitalist". Venture capitalists invest in businesses that lending institutions will not consider. Venture capitalists expected annual rates of return usually range from 35% to 75%. For an estimate, add 10% to the rate of return you chose in the previous question, and each time the business meets a criteria in the list below, add another 10%.

The business is less than five (5) years old.

You can count the exact number of clients.

The seller wants all cash when sold.

Profits are not consistent.

Owner is operator.

20) How much confidence do you have in the accuracy of the asset data? Enter 0% for no confidence. Enter 100% for complete confidence.

Use the following schedule of criteria to determine your answer. You must meet all the criteria in the next level to use that value.

75%

– Basically verbal information

– Some Documents

80%

– Some financial data is available

– Some outside research was done

– The owner gave verbal values

– Tax statements were done by a CPA

85%

– Some financial data is from statements

– Some outside research was done

– The physical inventory values are not clearly documented

– A CPA prepares this company's statements

90%

– All financial data is from statements

– Most outside research is documented

– The physical inventory is represented by some documents

– A CPA prepares this company's statements

95%

– All financial data is from audited statements

– All outside research documents are enclosed

– A physical inventory has been completed

– Routine statements are generated by a CPA

21) If you took a professionally prepared loan package for this business and its assets to local banks, what percentage of those banks would commit to a loan based solely on this business and its assets?

Call a banker. Knowing a banker by name may be valuable in the future. The term "professional" refers to complete information and no fraudulent data!

22) Over the past twelve months, what percent of total revenues came in as green cash? DO NOT COUNT ANYTHING BUT PURE CASH!

Do not read anything into this question or assume it means equivalents to cash.

23) Given the current state of leasehold improvements and equipment, what percent will need to be replaced each year to maintain a good image and run the business efficiently?

Try one or more of these methods:

Divide the estimated value of assets by the total estimated annual costs.

Divide maintenance expenses by the book value of all assets.

Ask the owner or manager.

24) Assuming the owner has a sales price and down payment in mind, what percent down would be required to buy this business?

Divide owner's suggested down payment by owner's suggested price. If the owner or owner's representative do not have a specific figure in mind, use 100%.

25) Given the current market value of these assets, what percent of that market value would a banker consider as collateral value?

Call a local banker.

26) What percentage of supplies or inventory for resale would be considered by an expert as dead or obsolete?

"Dead stock" can be defined as:

Broken lots of goods in a retail store

Disorganized storage of materials

Obsolete parts or merchandise

Normal bad stock levels will range from 5% in a very well run organization to as much as 40% in a poorly managed shop. Listed below are suggested sources of information:

Consult trade associations for averages

If suppliers stock the shelves (mainly retail shops) ask them for suggestions.

Compare "inventory turns" for this company versus Robert Morris or similar standards.

Talk to the employees that work with the merchandise daily to see how the company tracks and handles old stock.

Visually inspect supplies and stocks for age, dust, and application.

Ask the owner

The quantity of useless stock is highest in four types of companies:

New businesses with less than 5 years experience.

Older businesses that do not have set policies regarding purchasing and utilization.

Companies that do not have a specific person controlling inventory levels.

Companies losing money, particularly if it is a retail business.

When suppliers do not allow the return of merchandise.

When the owner can't remember the last time the stock room was thoroughly cleaned of old stock.

27) What percent of the workforce has been with the company more than two years?

Use total number of full time employees and part time employees. Family members do not count in seniority group!

28) What is the average inflation rate for the past three years?

The inflation index has many categories. Choose the category that applies to the majority of your expenses. Listed below are some of the categories:

Consumer Price Index

Wholesale Price Index

Producers Price Index

Inflation index information can be obtained from the following sources:

Public Library

Chamber of Commerce

Almanac

29) What percent of the total price asked by the owner will be OWNER financed?

What percent of down payment does the seller "philosophically" expect? Add any notes or credit lines that the seller will co-sign or "wrap" promissory notes that do not require or consume the buyer's own credit.

Enter value of transferable credit or note

Enter owner's price or asset value

Total transferable credit plus owner financing

30) On the owner financing, is the interest rate fixed or variable?

Ask the owner. Fixed rate loans are generally desirable over variable rates because of stability in planning. Variable rate loans generally indicate a very uncertain economic future.

31) On owner financing, what fixed rate of interest is the seller offering? If no financing is offered enter current bank fixed rate.

Ask the owner. If the owner will not finance the sale or is using a variable rate enter the current bank rate for annual interest vehicle loans or long term fixed mortgages.

32) If the owner is offering a variable rate loan, what is the percentage over or below prime? If the rate is below prime, make sure you enter the difference as a negative percentage.

Ask the owner.

33) What percent of the total price asked by the owner will be BANK financed?

Start with 100%. Deduct owner's suggested down payment percent. Deduct the percent of owner financing.

34) When securing bank financing, what type of interest rate will a purchaser most likely secure?

Ask your local banker what type of interest rate most businesses are currently applying for. You might also consult the Small Business Administration or similar agencies. Any loan must be based on this business's assets alone and not the assets of the buyer.

35) What is the current interest rate for a fixed rate small business loan?

Ask your local banker what interest rate most businesses at this scale are currently receiving. You might also consult the Small Business Administration or Economic Development Council. Any loan must be based on this business's assets alone and not the assets of the buyer.

36) What is the percentage over prime currently being offered by banks on VARIABLE RATE loans of this kind?

Ask your local banker what interest rate most businesses at this scale are currently receiving. You might also consult the Small Business Administration or Economic Development Council. Any loan must be based on this business's assets alone and not the assets of the buyer.

37) What is the current prime interest rate?

Ask your banker. Check the newspapers.

38) How many years has this business been at this location?

Ask the owner.

39) How many family members, relatives and/or partners, INCLUDING THE OWNER, are actively working in this business?

Add owner if they work routinely

Add all actively working partners

Add all working family members of owner

Add all working family members of partners

40) How many different accounts does this company sell or provide a service to?

Generally a retail business sells to so many people that a exact number of clients cannot be determined. For this program's purposes just make a reasonable estimate.

A wholesale, contracting, processing or manufacturing business often has a finite number of accounts. For accuracy in the final value, try to get an exact count.

If one account has independent purchasing groups such that if disqualification from one purchasing group does not disqualify the company from all purchasing groups - count each purchasing group as a separate account.

41) Using only the largest trade accounts, how many of these big accounts would be required to account for 25% of total revenues?

To calculate the revenue amount:

Start with gross revenue for past 12 months.

Deduct any extraneous revenue.

Divide the result by four (4)

What is the least number of accounts that is required to equal this 25% of gross revenue?

Sort the company's accounts in descending order by the volume of business transacted over the past 12 months.

When sorting accounts, consider that some large companies have regions and divisions that purchase independently. These individual regions, if they act autonomously in choosing clients, can be counted as individual accounts.

42) At the time of sale, how many years will the buyer have guaranteed under lease and lease options to conduct business?

Read the actual lease! Do not count a lease option if the rent or service charges can be escalated without limitations!

43) What is the SHORTEST number of years a buyer would expect to repay initial loans?

The months or years allowed for repayment of a loan are usually related to the average life of the assets unless the firm has been established for a long time. Listed below are some guidelines:

Ask your banker.

The depreciation schedules issued by the IRS allow for various periods of time to write off assets. Use these guidelines for maximums and minimums based on the types of assets in this company.

Ask the owner what terms seem reasonable.

By business type:

New small retail or service business: 1-3 years

Small retail or service businesses: 2-5 years

Medium retail or service businesses: 3-6 years

Small size, short lived heavy assets: 3-7 years

Small size, medium assets, established: 5-7 years

Medium size, heavy assets long lived: 7-10 years

Large size, heavy assets long lived: +10 years

44) What is the LONGEST number of years a buyer would expect to repay initial loans?

The months or years allowed for repayment of a loan are usually related to the average life of the assets unless the firm has been established for a long time. Listed below are some guidelines:

Ask your banker.

The depreciation schedules issued by the IRS allow for various periods of time to write off assets. Use these guidelines for maximums and minimums based on the types of assets in this company.

Ask the owner what terms seem reasonable.

By business type:

New small retail or service business: 1-3 years

Small retail or service businesses: 2-5 years

Medium retail or service businesses: 3-6 years

Small size, short lived heavy assets: 3-7 years

Small size, medium assets, established: 5-7 years

Medium size, heavy assets long lived: 7-10 years

Large size, heavy assets long lived: +10 years

45) What is the average age of the facilities and equipment?

Ask the owner.

We have already established depreciation schedules and expected lives on the assets. Visually inspect the inventory for maintenance and care to see if aging is happening faster or slower than projected by those schedules.

Use sampling techniques. Pick a major category of stock or equipment, calculate the various ages and average those ages.

46) For an individual who has reasonable skills but little knowledge of this industry, how long would it take to learn how to run this business?

"Functionally" means the ability to maintain the current level of activity with modest growth and handling all routine problems. Your answer represents intensive training time. Consult the owner and some direct competitors. Assume this individual is above average in financial ability, intelligence and management skills.

47) When starting a business at this scale, how many months would it take to show a profit after deducting a reasonable salary for the owner or manager?

The main purpose of this question is to determine how easily competitors can get into this business's market and compete directly. A good way to approach this question is to assume all brand new equipment set on the shortest depreciation schedules available, a small amount of trained employees and some customers already available. If you filed a tax statement each month, without using tax loopholes or extraneous credits, how many months would pass before you had to pay taxes?

A second approach would consider cash flow. Be sure to deduct a salary for the owner or manager. How long would it take for the cash flow to cover the debt service on new equipment, general expenses, billing lags etc. If bonding or special permits are transferable and required to do all types of this company's work, the time lag of obtaining such credentials would be additional.

48) How many full time employees does the business have?

In addition to paid full time employees, include all family and partners who work in this business full time, paid or unpaid.

49) How many part time employees does the business have?

In addition to paid part time employees, include all family and partners who work in this business part time, paid or unpaid.

50) How many weeks of owner training time would be given to a buyer at no charge?

Do not include any paid time or management contracts.

51) How secure are revenues?

This question is directed at the cost of collections and the residual value of goods or services if repossessed.

Trade accounts
These are accounts receivables customers that purchase or receive good or services from a company and use or distribute the product in such a way that repossession is virtually impossible.

Trade accounts with easy repossession
These accounts are similar to the first category but your product or service can be repossessed easily.

Lienable trade accounts, charge cards or checks
Accounts receivables in this category are backed by lien or attachment laws that assist in collections. In some states a lien can be filed against the title or deed to property thereby requiring payment at the time of sale of the property. Checks and charge cards do not insure collection, therefore, a loss of some level is generally incurred.

Trade accounts with bank collateral value
If this company trades with extremely stable or reliable customers (ATT, IBM, EXXON, etc) collection is generally assured and such receivables can be collateralized instead of factored.

Cash and cash only!

52) How many direct competitors are in this company's trade area?

1. None
   No competitors in my trade area and my operations show a profit.
2. A Few
   There are a few competitors but work and customers are plentiful.
3. Some
   Employees have to hustle and work to make operations profitable because competitors are around every corner.
4. A Fair Amount
   Prices are falling, costs are still rising, a couple good operations have closed and profits are slimming fast.
5. Many or Next Door
   Nobody in this trade area is making any money and a few good operators have laid off people or closed.

53) When on vacation, how often does the owner call in?

1. More than once a day
   Owner calls several times every day.
2. Daily
   Owner calls every day, but usually only once.
3. Weekly or a few times per week
   Owner calls once to several times each week. May schedule when he will call in advance.
4. Occasionally
   Owner calls to discuss the business, but only infrequently.
5. Never or no calls related to the business
   If the owner calls, it is only to discuss non-business matters. These calls typically include an account of what a great time he is having.

54) How did this company's find its last few employees?

The selections in the list should be self-explanatory. Select the typical method used to hire the last few employees.

55) What amount of training is required to understand and perform most aspects of this company's operations?

The selections in the list should be self-explanatory. Select the option that best describes the training required.

56) What is the company's liability exposure level?

1. None
   There is nothing mechanical, sharp or heavy in the work place.
2. Slight
   This work requires some light lifting, most sharp objects are protected or manually operated and there are no hazardous products.
3. Directly Responsible for Safety
   Some safety training and good common sense is required to prevent injuries.
4. Severe
   Minor injuries are almost daily with major injuries periodically.
5. Hazardous or Life Threatening
   Safety in this work place requires formal training and fatalities or long term health problems occur in this industry.

57) How important is the owner to the revenues of this business?

1. Indispensable
   The owner is the business.
2. Very Important
   The owner controls all activities.
3. Moderately Important
   The owner makes all major decisions.
4. Somewhat Important
   The owner shows up periodically.
5. Not Important (Absentee)
   No one is sure who the owner is.

58) How have gross revenues trended over the last three years?

1. Severe Decline
   Revenues have dropped off sharply.
2. Decline
   Revenues have dropped off somewhat.
3. No Change
   Revenues are essentially flat.
4. Growth
   Slight but definite growth after discounting inflation.
5. Strong Growth
   Growth beyond local or national inflation rates.

59) Is the owner involved in obtaining new business?

1. Owner obtains all new business
   The owner is the sales force. Employees are not involved in obtaining new business and don't make sales decisions.
2. Owner is a major player
   The owner is a member of the sale force. He contacts clients and solves their problems, in most cases directly.
3. Owner steps in to solve problems
   The owner only contacts customers when a serious problem arises. Most contact is through employees who can make significant decisions.
4. Owner stays in the background
   Customers deal with sales representatives in all cases. The owner may be consulted but is never in direct contact with customers.
5. Owner has no involvement
   All sales are handled by employees. The owner has no involvement in obtaining new business.

60) Considering social status, visual appeal, profits, and longevity, how desirable is this business?

The best sources of information on this question are bankers and business brokers. Ask some local bankers if any loans are currently being made for this type of business. Ask some local business brokers how this type of business is currently selling. Be sure to consult more than one source for this information. To qualify a business for the next higher level, all criteria in the current level must be met. Three out of four criteria does not count.

1. Undesirable

– Many hours of work are required with some profit.

– Very few loans are being made on this type of assets.

– Even at a low price, demand is limited.

– Documents of costs and revenues aren't available.

2. Less Than Average

– A good business with profits and some professional standing.

– The banker will discuss a loan but is discouraging from the beginning.

– The business broker is somewhat encouraging.

– Some documents of costs and revenues are available.

3. Average

– A business with a consistently good profit margin.

– The banker will discuss a loan and is marginally hopeful.

– The business broker is encouraging.

– Good documents of costs and revenues are available

4. More Than Average

– This business has been profitable and is well organized.

– The banker is fairly encouraging.

– The business broker is positive of a sale.

– Financial statements are complete and clear

5. Highly Desirable

– This business is protected from competition by legal restrictions with guaranteed or very secure profits and requires little or no time from the owner.

– The banker is talking terms.

– The business broker is absolutely positive of a sale.

– Audited financial statements.

61) Given past revenues and their seasonal variations, how confident would you feel projecting sales for the next few years?

1. No Confidence (Wild Guess)
   Roll the dice" or the business is too new to know.
2. Little Confidence (Mostly Guesswork)
   After about 6 months into the year we'll have an idea of the trends.
3. Somewhat Confident
   This company knows its cost and controls them but information about future trends is very difficult to obtain for planning purposes.
4. Moderately Confident
   This company budgets funds but tends to miss economic trends in spite of forecasting and previous years trend analysis.
5. Highly Confident
   This company budgets funds and is fairly accurate.

62) Have this company's liability insurance rates gone up or down?

These answers apply to both the business and the industry:

1. Down
   Rates have been reduced.
2. Unchanged
   Rates are the same if discounted for inflation.
3. Up Somewhat
   Rates are up above reasonable inflation.
4. Up Sharply
   Our insurance carriers use government pools and special rate adjustment plans to compensate for losses, but a couple carriers are available.
5. Almost Impossible to Get Insurance
   This company takes insurance if offered by a carrier or is in a government pool.

63) What is the trend for this company's market?

Answer should represent activity over the past three years in this company's trading area.

64) How long has this industry or product been widely known?

A good key for understanding the true age of an industry is to look at trade magazines and associations. Use the age of these as a guide.

65) What is the local economic trend?

Do not exaggerate or wish! Read local newspapers and listen to competitors.

66) What is the national economic trend?

Do not exaggerate or wish! Read national newspapers and listen to competitors.

67) Give the company's products and/or services, how good is its location?

Retail businesses must have slow to moderate speed traffic to be good.

Industrial businesses must be close to shipping and receiving routes.

Vehicle intense businesses must be centrally located to their service area.

Compare local competitors locations to this one.

Is the labor you want available in this area ?

68) How is the local labor market for this business?

1. Highly Competitive
   New employees must be paid a premium or moved in from out of the area.
2. Normal
   Wages seem about right or a little high but good people are available.
3. Little Competition (Unemployment)
   Talk is around about available people or applications are flowing in without request.

69) How would you rate the complexity of this business?

1. Simple
   Service businesses that tend to use products and labor to generate revenue. Capital equipment is usually minimal.
2. Light
   Retail businesses that generate revenue by selling a product without processing it to the general public.
3. Intermediate
   Light manufacturer, contractor, processor etc. where revenues are generated in larger increments and the physical plant consists of a fleet of vehicles and other capital equipment. These businesses mainly serve other businesses with a service or products. They generally do not deal on a retail level.
4. Complex
   Heavily capitalized with massive plant facilities. Generally sell to distributors or wholesalers.

70) How strong are labor unions in this area and industry?

1. No Union Presence
   No unions in the business's crafts in this area.
2. All Competitors Non-Union
   Some crafts are unionized but they have not organized employees at this business or at its competitors.
3. Some Competitors Unionized
   Some of the business's competitors are unionized.
4. All Competitors Unionized
   All of the business's competitors are unionized. The union is trying to organize the business's employees.
5. Business is Unionized
   The business is unionized.

71) If a broker is selling the business, what is the commission rate?

This percentage represents the cost of bringing customers to buy this business, not the legal fees, accounting cost and other charges associated with a sale. Enter only a percentage cost of selling through a representative.

72) What is the minimum amount a broker would spend to effectively present and market this business?

To calculate this number, add up what it would cost to value the business, advertise its sale, and provide office and telephone support to facilitate the sale. This does not include broker commission. The usual range is between $5,000 and $10,000.