Monday, July 16, 2012


Growth thru Acquisition



The economics of growth of a business thru acquisition of a target company is generally more favorable than attempting growing sales from within.   Merged Sales volumes from an acquisition are realized today's sales volume and stand-alone or organic growth of sales may take years.

This concept of growth is practical because the acquisition is reachable because of seller or bank lending services.


Think about this:

 Sales from your company PLUS adding sales from an acquired company===More Customers


            Expenditures from your company and Expenditures from the Acquired

Company can be selectively reduced or even eliminated.  i.e.

  • RENT
  • INSURANCES
  • DUPLICATE EQUIPMENT
  • UTLTITIES
  • WAGES
  • ADVERTISING
 

Results equal less expenses and then fewer expenses equal more cash to pay assistant manager

And pay your bank or seller debt services.  

FACT:>    virtually all businesses gross revenues have 50% C.O.G.S. and that leaves 50% for direct /selling expenses.  It is the 50% balance of revenues, gross profits, which can be synergized to then eliminate duplicate expenses.   Thus this increase profit from the merger of assets will pay the new bank debt or seller debt, Principle and interest.


1.                  Who is your target company owner   

  • Seller who has pasted away;
  • Divorced; 
  • Retiring;   
  • ust Doesn’t Want it any longer 

2.                  Absentee Business owner

3.                  Find a company where your knowledge is leveraged into another company

4.                  Just Do It in Little Steps (smaller little companies)



Got some more ideas or questions, let’s discuss, AJ Richwine CCIM

 


    

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