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The intention of my blog is to impart a lot of information, in an inspiring and educational way.  I love teaching and sharing my knowledge and experiences in a way that 'sticks.'  So, I hope that as you read my blog that you get to know me, and at the same time, the articles incentivize you to seek whatever knowledge is necessary to empower you to greatness!  It is all up to you, so READ ON!

Digging Deeper

Gayle Goldstone January 12, 2012

One of my favorite stories is when I was representing a person who wanted to buy a printing business.  Initially, I was asked to review the numbers.  For a small printing business, the numbers looked good.  Relative to the asking price, it was not out of line for the owner to be asking the price he was asking.  It seemed to me that there was parity between the volume and profit of the business, and the selling price.  That was a good start.  I also verified the information via the tax returns that had been filed.  If there was a disparity between what is presented as far as business activity, and the formal filings, that would have been a red flag.  So far so good, no red flags........

Next, I felt it was important to "hang out" around the business and monitor the activity of the customers as they came and went.  (This is also a good idea to watch and see that the activity "feels" appropriate).

Lastly, I went into the business itself, to look around and see the condition of the interior, the physical setting, and the equipment that was visible.  Again, everything met with expectations.

Then, I happened to notice a large number of boxes that were ready for pick-up by the front door.  I happened to notice that they were boxes of custom printing slated for shipment to another part of the state.  In fact, part of the state some distance away.  I found that was.....interesting.....and, quite impressed, asked the person behind the counter how they managed to get customers so far away.  "Well," he said, "the owner's family owns several hotels in that area."

Oh my!  The point of my story is to let you know that you cannot just look at the surface of something if you are planning to deal with transactions in the business world, but to dig deeper into areas if the decision that you are making is serious and significant.  Often, the important issues are not there for the asking, but have to be sought out.  Obviously, in this case, although the owner's family might still do business with the new owner, there is certainly a question mark about it now, isn't there?  That lends all that much more importance to the phrase, "caveat emptor."  We must protect ourselves as much as possible, and make every effort we can to assure our business transactions are successful and that there are as few surprises as possible.

Categories:  Read The Fine Print, This Happened... Really

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