What is the Difference Between LaManna Consulting Group and a Licensed Business Broker?

Rock, just curious – when I sell my label converting business, why should I work with you versus a business broker who just takes a cut of the sale?

Great question – and one that comes up all the time.

The strongest reason to choose LaManna Consulting Group early in the process is that we are a management consulting firm focused on serving specialty graphic arts businesses. We won’t undervalue you like a broker might because those unaware think “print is dead.” As you know, the label and specialty graphics sectors are robust and in demand by buyers of all types, especially private equity. We know which characteristics make a business more attractive to buyers in this market. We are also deeply familiar with which buying organizations are searching for businesses like yours.

Unlike a broker who might run some ads or put the word out to their network, we have a deep database and access to buyers and referral partners who always keep their eyes peeled for opportunities.

Our specialization and background in this sector make us an ideal partner for you as your sell-side advisor.

Now let’s discuss your specific question: How does LaManna Consulting Group differ from a licensed business broker in services and compensation?

Let’s start with compensation.

HOW DOES A BUSINESS BROKER GET PAID?

A business broker gets paid for selling the business. I recommend you choose one with all the proper credentials who operates in your state, and we can help you with that.

A range of 10 to 12 percent of the total sale price is typical compensation to the broker. It does not include attorneys, CPA, bank fees, closing costs, or any other costs not itemized in the broker’s agreement.

For example, a $10 million sale price will mean one million to 1.2 million for the broker.

Depending on your arrangement with your broker, you may pay a commission if the business sells (known as a contingency). This agreement differs with each broker. However, most brokers are only interested in working with companies ready to be marketed. Brokers typically are not suited to help owners with the ongoing strategic and tactical work to increase the business value.

Our relationship with clients is based on confidentiality and respect. We work on your behalf to give you the tools and education to improve your business in the ways that add value. We will not push a sale through at any cost merely to collect our fee or move on to the next deal.

If we can help you get a 10-million-dollar company up to 15 million, for example, before you put it on the market, we can potentially increase your multiple as well as your asking price. Companies in demand that are well-positioned command the most attention and best offers.

HOW DOES LAMANNA CONSULTING GROUP GET PAID?

LaManna Consulting Group is a management consulting firm focused on helping owners add value to their businesses. By following our recommendations, you can potentially command a higher asking price or make your business more desirable. We can help you with the steps required to prepare to sell, introduce you as a seller, market you on our channels, and find a qualified match.

We have a vast international network of connections and professional relationships.

Unlike a broker, who only steps in when the business is ready to be put on the market, we are with you every step of the way. We are even available for consulting after the transition and to assist in integration or getting your successors off to a strong start.

We typically work with owners in three areas:

Grow: We evaluate your business and advise you on how to grow through sales and other topline revenue, strategic acquisitions, capex planning, and operational improvements.

Sell: We evaluate your business, identify strengths and weaknesses to address issues or bolster you where you have leverage, educate you on how to sell the business yourself (if you are interested), introduce you to a reputable broker, and help you position for optimal offers. We are your sell-side advisor for the entire process, if you choose.

Buy: We evaluate your business for financial and management readiness. We make customized recommendations on how to improve the business to prepare for an acquisition or tuck-in. We are your confidential advisor to improve your success during transition and post-sale, two areas where deals tend to fail if the owner doesn’t have expert assistance.

There are 7 Stages in our assistance, and each one builds on the next. Our services are modular, so you can progress through all the stages or complete a module at a time.

STAGE 1 – Review.
We will listen as you explain your situation to get a lay of the land. We do a light overview of your financial situation as you describe it. We discuss your timeline to exit and where you believe you need to make changes to get top dollar for your business.

STAGE 2 – We research and prepare an in-depth written evaluation of your business, a broker’s opinion of value prepared by Rock LaManna and the LCG team, and our top recommendations.

Stage 3 – We coach you through our proprietary LCG program, where you focus on revenue growth activity and operational improvements – typically a six-month process.

Stage 3B, etc. – If the business is not ready to put on the market, we repeat this stage as often as needed, in 90 to 120-day cycles.

Stage 4 – Pre-Sale Activities – We get you ready for inspection, so to speak, and make sure all the items on your due diligence checklist are professional, presentable, and aligned. This stage typically takes 90 days once the business is ready to sell.

Stage 5 – Selling Process – We help you and the buyer through the offer, due diligence, and closing.

Stage 6 – Post-Sale Advisory – We recommend a six-month engagement to help you close out properly, answer questions, and assist with transition and integration.

Stage 7 – Ongoing Management Consulting – We can coach your successor before or after closing. We can prepare you for your next venture.

Here’s a special report, Code Red: 12 Seller Mistakes, to help you keep your eyes open as you start business selling the process.

Please read it with our compliments, and call us if you have questions.

I hope this explanation and timeline is helpful. You can see why you should choose a management consulting advisory that specializes in the label industry at the beginning of your exit process rather than a generalist business broker who only deals with ready-to-sell entities.

If you foresee an exit in your future, please get in touch.