Tag Archive: guides

Five Tips For Preparing To Sell A Family-Owned Business

by Meir A. Lewittes and Eric I. Moskowitz of McDermott Will & Emery

Selling a family-owned business will typically be a once-in-a-lifetime event.  Throughout the transaction, owners of a closely-held company must concurrently maintain the ordinary course operations of the business, while at the same time negotiating the sale with the buyer in strict confidence.  The stakes are high, with major financial and emotional implications for sellers and their families.  This makes navigating the sale process both an exhilarating and arduous experience.  Below are five tips for family business owners to ensure they are well-prepared to court prospective purchasers and close a deal.

Double Withholding on the Redemption of Shares Owned by a Non-Resident

by Marc Weisman of Torkin Manes LLP

As part of my tax and business law practice, I regularly act as counsel to foreign companies establishing operations in Canada.  So, I take careful note of Canada Revenue Agency (the “CRA”) Technical Interpretations that apply to international tax situations.

In Technical Interpretation 2010-0387151E5 dated February 10, 2011, the CRA dealt with the following situation:

  • a non-resident of Canada is resident in a country that does not have a tax treaty with Canada;
  • the non-resident owns shares in a Canadian resident company (“Canco”) whose only asset is real estate in Canada;
  • the shares of the Canco are taxable Canadian property;
  • Canco redeems its shares held by the non-resident for fair market value; and
  • the non-resident and Canco deal with each other at arm’s length.

At issue was whether Canco’s redemption of the non-resident’s shares is subject to two withholdings: under subsections 212(2) and 116(5) of theIncome Tax Act (Canada) (the “ITA”).

Sales Thought – Sounds in Darkness

by Nick Miller of Clarity Advantage

In which we are reminded that listening, really listening involves more than words.

One warm mid-summer Thursday evening, my wife and I stepped out to dinner. Following the meal, we walked through Harvard Square in Cambridge, MA to see the sights. About half-way through the walk, we heard ‘happy’ Dixieland brass music and people clapping enthusiastically. We ambled closer, seeing five young musicians performing in a small park.

During the course of the 45 minutes we sat there, they moved quickly through Dixieland to Gershwin (Porgy and Bess, the opera) to Rossini (Barber of Seville opera overture, this is a five-piece brass ensemble, mind you) to Thomas Tallis and Handel. Not your average street performers, we thought. Extraordinary musicianship, lively presentation.

They stopped at 10:00. We asked, ‘Who are you?’ They turn out to be five guys in their twenties, the Synergy Quartet, a 260-gig per year classical ensemble. We learned that this ‘street’ performance was an ‘open rehearsal’ through which they wrap up two months of 12-hour rehearsal days off the road preparing for the fall season. And that most of their practice is conducted in the dark. Like, no lights. Pitch black. “So we have to listen to each other,” Bobby the first trumpet explained. “We have to learn how to listen to each others’ breathing and tone so we can play together.”

Harvey Mackay – Clear thinking is in critical condition

A Midwest university professor complained: “We are now focusing more on how to use the tools of communication than we are on how to effectively communicate … As a result, we are turning out computer and internet gurus who can’t write and think creatively.”

Sales Thought – Socks

by Nick Miller of Clarity Advantage

In which we are reminded that one key to cross selling is understanding clients’ goals and destinations.

“I would like to buy some socks,” my friend said. He was just inside the entrance to a V E R Y nice men’s clothing store, responding to a sales person’s gently formal yet genuinely warm greeting.

“Ah, of course,” responded the sales person, authoritatively. “Socks. Follow me.”

Sales Thought – Common Interests

by Nick Miller of Clarity Advantage

In which we discover that starting conversations with strangers is easy if we can find common interests.

With the melody, “Rock My Soul in the Bosom of Abraham,” and the rhythmic clapping of a fully aroused, Boston opening night audience still ringing in my ears, I stood at the end of Row Q, waiting my turn to step into the aisle and leave the theater.

In the aisle, waiting his turn to move past me, stood an older man, perhaps in his early ’80s. In his prime, he would have been a little taller than me. Solidly built. I imagine he was probably quite athletic and terribly good looking. Now he was an older man in a wrinkled tan rain coat and blue blazer, his head bowed forward, slightly, almost resting, waiting patiently for a throng of dance patrons to move up the aisle.

“Are you uplifted?” I asked, looking at him.

He turned his face toward me, looking at me silently for a moment, as if gauging the source and the purpose of the question. I smiled at him, gently.

“Yes,” he said, with a thin smile. “I am…. I saw it Tuesday night, I’ve seen it tonight, and I’ll see it Saturday night.”

Tie-downs are critical to sales

By Harvey Mackay

If you knew two little words that could improve your sales, you’d use them, wouldn’t you?

When you see your customer has some reservations, it makes sense to get the issues out in the open, doesn’t it?

And after the ink is dry on the deal, you should make every effort to make sure your customer is satisfied, shouldn’t you?

So why all the questions? They illustrate a simple technique – sales tie-downs – that can help you improve your sales. By getting your customers to agree with you in small steps along the way, you have a better chance of reaching agreement when it’s time to do business.

Canadian Government Imposes Additional Requirements on Certain Financial Products and Services

By Blair W. KeefePeter A. Aziz and Eli Monas of Torys LLP

The Canadian federal government recently published three regulations that will impose additional requirements and restrictions on the use of credit card cheques, on cheque hold periods and on the provision of new optional products or services.

Proposed amendments to the Credit Business Practices Regulations would require federally regulated financial institutions (FRFIs) to obtain the express consent of borrowers before distributing credit card cheques. The Access to Funds Regulations will reduce the maximum cheque hold period for consumers and small and medium-sized enterprises. In addition, the Negative Option Billing Regulations will require FRFIs to obtain consumers’ express consent before providing a new optional product or service.

The Credit Business Practices Regulations were published in the Canada Gazette on March 10, 2012, for a 30-day comment period and will come into force on the date on which they are registered. The other two regulations were published on March 14, 2012, in final form and will come into force on August 1, 2012. The Financial Consumer Agency of Canada (FCAC) will oversee compliance with each regulation.

The details of these regulations are discussed below.

How CPA Firms Make Money in Turbulent Times

by Gary Adamson of Adamson Advisory

The universal measure of profitability in accounting firms is average income per partner. Another universal tool is the annual Rosenberg National MAP Survey. It’s a must-have for running your firm.

In the latest survey, Rosenberg identifies his “elite” firms, which are the 54 that had income per partner of more than $500,000. Not bad considering it is based on 2009 economic data—from the middle of the recession.

It’s interesting, if you dig into the data in the survey, you will find that these 54 aren’t just the biggest firms, although as Rosenberg puts it, bigger is better in terms of profitability. In fact, 24 of them are in the $2-$10 million fee range and three are sole proprietors.

Sales Thought – Before The Cold Sets In

by Nick Miller of Clarity Advantage

In which we are reminded to engage our clients on what’s top of mind for them right now rather than on what’s top of mind for us.

I live near Boston, Massachusetts.  The Red Sox are finished.  Winter is coming.  Around the Miller household, we are preparing our house and garden for the winter.  Storm windows hung up, hosta cut down, lime and fertilizer spread around. Early days, still, and we’re working our way through the list, week by week, toward the inevitable arrival of sharply colder temperatures and snow.

As a business owner, I’m feeling like I’m in the same position now – another economic winter is coming, and I need to prepare.

The news coming out of the Eurozone ranges from “not encouraging” on a good day to “frightening” on other days.  U.S. and foreign stock market heaves and rolls leave me sea sick as my investment values bounce up and down, almost carelessly. The political and regulatory environment in this country leaves me shaking my head.  Our clients’ outlooks for 2012 range from guarded optimism to bracing for a crash.

Sales Thought – An Early Lesson

by Nick Miller of Clarity Advantage

In which we are reminded to focus first on relationship and value demonstration, then on the commissionable task.

On a spring afternoon long decades ago, we sat almost knee to knee in a hotel lobby after a sales and marketing conference we’d both attended. She, leaning back, almost lounging, on a hotel lobby couch. I, sitting on the edge of an arm chair, facing her, leaning forward. She reached into her purse, fished around, and pulled out a pencil.

“Sell me this.” Her eyes barely moved.

I looked at the pencil. It was a standard yellow wood #2 pencil that, in her hand, looked as big as a shovel.

“Come on,” she purred, extending her pencil-bearing hand toward me. “Sell me this pencil. It can be anything you want.”

Sales Thought – Matted Down

by Nick Miller of Clarity Advantage

In which we are reminded to follow our “broad” questions with very specific questions that tease out the detailed facts we need to propose value-based solutions.

With apologies to y’all in Texas and other states who haven’t had rain or grass for a couple of years:

I mowed our  lawn on Saturday. Beautiful day for mowing, just a little bit of cool fall air with brilliant September sunshine.   Thanks to recent rains and the fall dose of lime and fertilizer, our lawn is thickly green, punctuated with early fall leaves.

One small hitch in the giddy-up.  The ride-on lawn mower we use for grass and leaves at this time of year features wide front and rear tires that matt down the grass so that the mower blades ride over the matted grass which can get pretty long, even when we’re mowing weekly. So, after we mow, we rake portions of the grass, teasing up the matted down long bits so that we can clip them with hand-clippers or mow them with the standard rotary mower.

Sales Thought – Totally Concrete

by Nick Miller of Clarity Advantage

In which we are reminded to clarify terms we don’t understand before presenting ideas.

One person’s golf is another person’s word play – meaning, I love a good pun as much as my golfing friends love a good drive or putt.  I love rough puns a lot more than my friends enjoy hitting balls into the tall grass.

Anyhoo, a couple of weeks ago, during the “warming up” stage of a conference call, a few of us on the line began fooling around with puns and plays on words we remembered hearing from our elementary school children.

One of the group offered:

Two fish swim into a concrete wall. The one turns to the other and says, “Dam!”

The folks on the line guffawed appropriately.

Another offered:

Sales Thought – Old Habits

by Nick Miller of Clarity Advantage

In which we are encouraged to ask others to help us identify and correct old habits that hold us back.

From the “I can’t believe I’m going to tell you this story and you probably won’t either and there won’t be many secrets left after I tell you this one” department: for several decades, I have had a problem eating. Actually, I haven’t had a problem “eating,” as in chewing, swallowing, and enjoying the multiple benefits of a balanced diet. I had a problem getting food into my mouth reliably. (I can see my spouse and children rolling their eyes now.)

Sales Thought – Simple, Neat, and Incomplete

by Nick Miller of Clarity Advantage

In which we are reminded to step back and look for the broader picture before we pitch solution for the problem we’ve just heard.

Watching classroom sales training role-plays is a little like watching football teams practice without pads…  Low intensity.  Move through the motions.  Nobody trying too hard to take anyone else out.  Still, an observer can get a general sense of the team.  Essential tendencies shine through.

So, as I was watching and coaching this particular set of “pad-free practice role-plays,” I saw an essential tendency.  As the “sellers” in the role plays heard a bit of information that suggested a potential need for a product, they would say, almost reflexively, “if I could show you a way to…”  or “we have a product that would help you….”