An Unforeseen Tragedy in 2020

Handling an unforeseen tragedy in 2020. Problem/Issue:

• 25 year old family-owned business with revenue in the $5-10M range.

• Sudden death of owner who sold and maintained 80% of the accounts.

• Recently, the company lost their biggest client.

• Out of $1.5M inventory about $1M of it was out-of-date and would have to be salvaged.

• The company owned building and real estate.

• Relationships in the family were lukewarm.

• The spouse and children did not want to maintain the business and wanted to sell the business, building and real estate.

Action:

• Develop a relationship based on trust with each family member.

• Determine the value of all assets individually and collectively

Appraisals from licensed entities for land and building

Verify inventory value including salvage amount for dead inventory.

Value for fixed assets

• Review of financials

Past three years up to current

A/R, Cash Flow and the Balance Sheet

• Identify potential buyer(s) for all assets.

• Provide options to estate

• Received authority level from family for estate negotiations

Result

In the first 30 days we identified a potential buyer and after negotiations with the estate the package of business, building and real estate settled for an amount that was 12% higher than what the family authorized. Cash was in the estate within 180 days