I’ve heard the owners of a jewelry store in a nearby community may be looking to get out of the business. I’m possibly interested in their store. How can I get financial information, particularly sales figures, to see what it might be worth?
Before you make a formal offer, which then entitles you to conduct due diligence, there’s no easy way to access privately held business information. The best place to start is the store’s website, which may include press releases or background notes on the store and its operations. After that try a wider Internet search, keeping a sharp eye out for articles that may have been written in trade journals or the local business media. (Remember however that figures given to the press haven’t usually been verified.) Then try public records such as legal judgments and lawsuits and business and professional licensing records. Former or current employees, if you can track them down, will often be able to give you indications of a how a store is performing, although you do risk tipping your hand. Two longshots are credit firm D&B and its subsidiary Hoover’s Online, which focuses on smaller businesses. Finally, when it comes to pricing a business you may want to check Pratt’s Stats, which is a database of business sales that allows you to compare other business sales in an industry.
When do you ask a customer about his or her budget?
If you have to ask, do it late in the presentation, says sales trainer Dave Richardson. Any earlier and you limit the range of pieces you can show him or her. You also make it harder to work in an add-on. “If he shares his budget with you, OK at least now you know,” Richardson says. “But in the end budget is really only relevant to the romance and value you build into the item.”
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I want to expand my business but am low on cash. I was thinking of hitting up my father (who doesn’t come from the industry). What do you think?
Man turns his back on his family, well he just ain’t no good… Now if you’d asked Bruce Springsteen for advice he might have said sure, go for it. But our less lyrical suggestion would be to think twice before mixing money with family or friends. Instead of trying to get all the cash from your father, see if you can’t raise half of it from neutral sources first. That way you bring some outside perspective and scrutiny to your quest. It also sends out the right message: That this is about investment funds or a business loan (or at least it should be), not a gift. You also reduce the risk of having your father interfere in how you run the business.
I’m a junior member of a sales team of five people. They’re all good people but one of the older girls bugs the hell out of me. It’s purely a personality thing. What do I do?
Focus on the positives. Continually remind yourself of the contributions your colleague makes to the team, the store, and if you can find it, to your own sales efforts. If that’s too hard then at least stop yourself from falling into the trap of recruiting allies to your divisive cause. Sure it feels better to have someone confirm she’s an annoying old biddy but it also makes her a presence a bigger issue in the store (for you). Try to minimize contact and maybe even ask yourself, does she irk everyone or is there something about you that has you grimacing like this?
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It’s tax season and I need a quick answer. Tell me, can I deduct inventory that’s gathering dust?
We like tax questions because they’re so easy to deal with: Go check with your tax pro. Otherwise, you’ll have to take the advice of Joe the CPA who drinks at our local watering hole. According to him, the bottom line on inventory deductions is that you can’t take a write-down if you’re trying to sell the goods at full price. Your accountant will need to be able to prove that you’ve offered the goods at a discount. The proof can be a clipping of a newspaper ad offering discounts or even an e-mail promotion sent to your regular customers. With that, you can claim it as a write down, even if the inventory doesn’t move. Right, now you owe Joe a beer.