Leadership Santa Fe

Leadership Santa Fe helps up-and-coming leaders develop high-level management skills and connects them to key players in Santa Fe’s business and policy spheres. Participants delve into challenges facing the city and actively engage in the process of creating solutions. The program takes place every year between September and May and consists of 12 sessions, about two per month. Alumni include Santa Fe City Manager Erik Litzenberg, Police Chief Andrew Padilla, and multiple City Council members and business leaders. We spoke with Program Director Valerie Alarid about LSF, its participants, and its value to the city and graduates. Applications are open through August and available here. There will be an informative kickoff celebration Monday, August 26, 5:30-7:00PM at Rio Chama Restaurant. RSVP required – register at info@leadershipsantafe.org.

Could you give us a bird’s eye description of the program?

LSF has a civics and a leadership skills development portion. We focus on six topics: youth and education, economic development, government, energy and sustainability, health and public safety, and non-profits. We go into the whole community of Santa Fe, holding sessions at multiple venues. It’s a great way to get to know different businesses and connect with people in various sectors.

What are the most important takeaways for participants?

First, they learn so much about the community and fiber of Santa Fe. Both locals and newcomers tell us they gained insights into areas and issues they’d never considered before. Second, people learn about themselves. They cultivate new skills and discover strengths they often hadn’t realized they had. The program also creates a lifetime of strong professional and personal relationships. Participants leave knowing they can always reach out to this network.

What are the benefits to Santa Fe?

LSF aims to create leaders in many forms. We support rising business leaders that might go into upper management roles as well as people who are interested in public office. Participants move on with a practicable understanding of diverse facets of the city. This allows them to contribute and make a positive impact whatever area they choose to pursue.

What’s an average cohort like, and who are your participants?

Cohorts are usually around 30 people. We keep them small so that our trainers can give everyone the attention they deserve. Groups are diverse and balanced. There is an application process and a review committee accepts the top candidates. A lot of individuals are sent over by their business’ management team for training. We also have independent individuals who want to go into public service, learn more about Santa Fe’s vast non-profit scene, or start or grow their own business.

What are you most excited about for this year’s program?

I’m especially jazzed that the economic development session will feature Daniel Werwath, who focuses on affordable housing and community development in Santa Fe. There’s a coalition working on housing solutions for the city, and I’m hoping some of this year’s cohort will bite into that work. It’s an important issue for attracting and retaining talent for Santa Fe.

The program is $1,045 for the whole seven months. Sponsors underwrite about 80% of the budget. LSF thanks early committed 2019/2020 program sponsors Enterprise Bank & Trust, New Mexico Gas Company, Delta Dental, Journal North, Century Bank, State Employees Credit Union, and CHRISTUS St. Vincent.

 

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What’s It Worth? 9 Key Factors for Business Valuations

Do You Need a Business Valuation?

Whether you’re buying or selling a business, a business valuation is a necessary step in the process. You might be more familiar with the term “business appraisal.” These two interchangeable terms describe a complicated process used to determine what a business is worth.

There is no “cookie cutter” way to do this. There are different types of business valuations for different circumstances. There are some circumstances where a formal valuation is needed. In other instances, a less formal approach can be taken. We will help you navigate the various types of business valuations and determine which type of appraisal you need for your specific circumstances.

What Is My Small Business Worth?

Every business owner (and potential business owner!) wants a simple, clean answer. Unfortunately, too many business brokers, CPAs, and fishing buddies are more than happy to give them a simple yet incorrect one. The process of pricing a small business is like preparing a complex meal. You put in a lot of key ingredients to get to the end result.

9 Key Ingredients for Pricing a Small Business Correctly

  • Sales revenue – Is the business growing? Shrinking? Is it volatile year-to-year?
  • Profits – After adjusting for the owner’s earnings, what profit is the business actually making?
  • Customer Concentration – Is the largest customer a large part of the total business sales? Is it the same large customer every year? What is the risk of losing that customer?
  • Vendor concentration – Is the business dependent on a critical supplier? Is there a replacement supplier if something goes wrong?
  • Family members – Who is involved in the business?
  • Big industry or regulatory changes – What shifts are in the works?  Good or bad?
  • Financial records – Does the profit and loss statement accurately reflect the financial performance of the business? Can the tax returns and P&L be reconciled easily?
  • Accounting – Is the accounting done on a cash basis? Accrual? Are tax returns and financial statements prepared with consistent accounting principles?
  • Current interest rate – What is the present interest environment? Generally speaking, the higher the interest rates the lower the business value to a buyer due to the higher cost of borrowing to pay for the business.

And the list of issues goes on! The best advice: ignore any “Rule of Thumb”advice.  Contact us to set up a frank, confidential discussion. We can guide you through the process of determining a price for your business in today’s market that will help you meet your goals.

 

 

 

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4 Tips to Build Managerial Confidence

A lot of people know the symptoms: feeling overwhelmed, unworthy, overly lucky, terror at being “found out.” If you’ve wrestled with Impostor Syndrome, you know the struggle is real—even when your lack of qualifications isn’t!

Impostor Syndrome is a pervasive sense of self-doubt, a belief that one’s successes have not been earned. While this insecurity can strike at any level of professional experience, research indicates that it is more common when starting a new endeavor, such as managing a new business.

In a recent article on Fast Company, writer and senior strategist Jackie Berkery shares four tips tailored for new managers dealing with confidence issues.

Claim Your Success

“Take time to contemplate what’s been accomplished and the role you played,” Berkery suggests. Acknowledge what your team did well, but also what you, as their manager, did to facilitate and foster that success. “When you don’t have a concrete sense of how your individual behaviors generate certain outcomes,” she points out, “you can’t learn from either your failures or your successes—and, for the record, the latter is just as important as the former.”

Vulnerability in Moderation

“The benefits of vulnerability get sidelined when your team hears you doubt your own management skills,” says Berkery. “Most of the time, your team needs someone who can inspire confidence, display composure and consistency, and lead by example. While there’s still ample room for showing empathy, owning your mistakes, and developing an approachable, open management style, expressing doubt in your abilities as a manager is not an effective strategy.”

Get Specific Positive Feedback

Receiving and responding to constructive criticism is an important part of growth. Positive feedback is an important part of the learning process too! “Ask for two to three specific things you’ve done that have been helpful or had a positive impact,” Berkery suggests.

Embrace a Growth Mindset

It’s OK that you don’t know it all yet! “There will be a learning curve and skills you need to develop over time. It’s only natural you’ll second-guess yourself along the way,” says Berkery. “Recognizing your imperfections while putting in the work to improve isn’t the same as the paralyzing downward spiral of self-doubt triggered by Impostor Syndrome. If you don’t feel confident in your abilities right now, be confident in your ability to learn and grow and just plain work hard instead. Confidence as a manager and leader will come.”

In another article, we discuss the value of a training and transition phase as well. When you buy a business, this phase is a great learning opportunity. The seller, as well as veteran employees, will often help you settle in. Take this chance to learn as much as you can. You got this!

 

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New Mexico Cities Some of the Best in the World

Strong showing, New Mexico!

Santa Fe ranked 14 in Travel + Leisure’s 24th reader survey of Top 15 Cities in the World and got second place for Best Cities in the United States. Taos ranks 12 on the Best of the U.S. list.

“Readers rated cities on their sights and landmarks, culture, cuisine, friendliness, shopping, and overall value,” T+L explains.

New Mexico also got three of ten Top Destination Spas, and Santa Fe’s Inn of the Five Graces was named The Best Hotel in the Continental U.S.

Additionally, New Mexico outpaced the national average for job creation this year, according to a report by the NM Department of Workforce Solutions. “This growth, particularly in the private sector, shows New Mexico is headed in the right direction and open for business,” says NMDWS Secretary Bill McCamley. “You can earn a great salary here while staying in our friendly, beautiful communities.”

And, obviously, we have the best chile.

The Land of Enchantment is a great place to be a business owner!

 

 

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Business Buyers Can Leverage SBA Lending

Finding the money to start your own small business can be a challenge.  Over the decades, countless people have turned to the Small Business Administration (SBA) for help.  A recent Inc. Magazine article, “Kickstart Your Business Dreams with SBA Lending,” by BizBuySell President, Bob House, explored how SBA lending can be used to the buyer’s advantage.

The article covers the basics of an SBA loan and who should try to get one.  House notes that the SBA doesn’t provide loans itself, but instead facilitates lending and even micro-lending with a range of partners.  The loans are backed by the government, which means that lenders are more willing to offer a loan to an entrepreneur who might not typically qualify for one.  The fact is that the SBA will cover 75% of a lender’s loss if the loan goes into default.

Entrepreneurs can benefit tremendously from this program.  In some cases, an SBA loan even means skipping the need for collateral.  SBA loans can be used for those looking to open a business, expand their existing business or open a franchise.

House points out that getting an SBA loan has much in common with receiving other types of loans.  For example, it is necessary to be “bank ready.”  By “bank ready,” House means that all of your financial documentation should be organized, clear to understand and ready to go.

Next, a buyer would need to check that he or she qualifies, find a lender and fill out the necessary SBA forms.  In order to be eligible for an SBA loan, it is necessary that the business is a for-profit venture and that it will do business in the United States.  Once the necessary forms have been submitted, it can take between 2 to 3 months for an application to be processed and potentially approved.

The simple fact is that the SBA helps thousands of people every year.  If you are looking to buy a business or expand your current business, then working with the SBA could be exactly what you need.  Of course, business brokers are experts on what it takes to buy.  Working with a broker stands as one of the single best ways to turn the dream of owning a business into a reality.

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Ghosting Haunts: 6 Tips to Protect Your Reputation in the Labor Market

It’s normal to think about interview etiquette when you’re going up for a position, but what about when you’re making the hiring decisions? In a recent Wall Street Journal article, reporter Sue Shellenbarger points out the significance of employer conduct during the selection process.

It is important to think about how you treat potential employees. We all know the feeling that there aren’t enough hours in a day. With a small business, you can’t put everything on pause while filling a vacant position. Your “to do” list is varied and ongoing. Interviewing and vetting take time. It’s definitely a lot! Nevertheless, your communication with candidates should reflect your business’ values.

Why it Matters

“Employers are battling to hire skilled employees in one of the tightest labor markets in 50 years,” Shellenbarger warns. Dismissive behavior, such as “ghosting” candidates, can damage a business’ reputation in the labor market. A few disgruntled stories can make a meaningful impression with the rapid fire spread of information over social media.

A negative impression can also hurt a business’ consumer reputation, Shellenbarger points out.  “More than three in five job seekers say being treated badly would make them less likely to buy the company’s products, according to a 2017 survey by Future Workplace and Career Arc,” she says. “While 91% of employers agree that candidates’ experience can affect their buying decisions, only 26% bother to measure how well they’re doing.”

Be Aware

Obviously, it’s important to make carefully considered hiring choices in building your team. Keep in mind, however, the average hiring process takes almost twice as long now as ten years ago.  Application processes also often involve creating and submitting work-intensive samples. This can all increase candidates’ opportunity costs. “The extended hiring process raises the stakes for applicants, who must invest more time and energy,” says Shellenbarger.

She continues, “Only two out of five front-line managers are trained in how to make the hiring process a positive experience for candidates, a 2017 CareerBuilder survey says. The training they do receive tends to be defensive in nature, on avoiding charges of illegal discrimination. This can make them doubly reluctant to contact losing candidates, for fear that in delivering the news, they’ll open themselves somehow to charges of race, gender or other bias.”

Positive Hiring Practice Tips

To avoid muddying the waters of your potential labor pool, Shellenbarger gives the following six tips:

  • Make sure your job postings accurately describe the openings.
  • Acknowledge applicants’ resumes soon after they’re received.
  • Train hiring managers to treat all applicants well.
  • Keep candidates informed about where they stand.
  • Let applicants know if you change course in the middle of a search.
  • Leave the losers as well as the winners with a positive image of the company.

 

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8 Tips to Get and Keep Good Employees

“I can’t get good employees.” How often have you heard this from small business owners?

Cultivating a good team is an essential challenge. Here are some tips for attracting and retaining good employees:

  1.  Model integrity. Say what you’ll do, then do what you say.
  2. Always be respectful to employees and customers, even when you’re angry. People hear how you talk about others in moments of frustration and assume that’s how you’ll talk about them when they make mistakes.
  3. Even if you know the answer, help the employee figure it out.
  4. Let your employees make little mistakes and then show the leadership compassion when you unscramble the problem.
  5. Focus local  for employees. A short commute is high value these days.
  6. Don’t be afraid to hire people who are smarter than you. When you do, let them help you.
  7. Focus on total compensation, not just the salary. Put in place bonus plans so that when the business does well, everyone does well.
  8. Hire slow, fire fast.

If you are purchasing a business, the training and transition phase is important. Usually, the seller will assist, helping you understand the ins and outs of your new business and providing stability for both your new employees and your customers. Hopefully, your new business also comes with some veteran employees who know the ropes. Try to resist making sweeping changes right away. Employees may feel  uncertain working for a new business owner. Some consistency will help them feel comfortable to keep doing their jobs. It also gives you a chance to make more informed decisions. For more tips on setting yourself and your employees up for a smooth transition, click here.

That’s a start. There are great people out there who can help your business thrive. Now the real question is, how do you become a business owner who deserves better people?
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Less Risky Business: Buy a Business

In a recent Harvard Business Review article, Harvard Business School professors Richard S. Ruback and Royce Yudkoff advocate for more aspiring entrepreneurs to pursue their goals by buying a business. They site concern over risk as the most common explanation for shying away from acquisition. They further argue that these concerns are short sighted and unfounded.

Comparing Risk

“We think that these concerns about ‘risk’ are misplaced and that searching for a business is less risky than other career paths that are traditionally considered more stable,” they write.

“Nine out of ten startups will fail. This is a hard and bleak truth,” says Forbes contributor Neil Patel. “Cold statistics like these are not intended to discourage entrepreneurs, but to encourage them to work smarter.”

Top 10 Reasons Startup Fail (by CB Insights)

Purchasing a vetted business allows you to avoid many of the reasons for this high failure rate. “Your chances of success are far greater buying an existing business than starting your own,” says Michael Greene, President of Sam Goldenberg and Associates.  “A good broker can help you find an established business that already has a proven success model, history of revenue generation, and immediate cash flow. It can also come with much more: inventory, trained employees, a customer base, operating systems, equipment, vendors, transitional support—the list goes on. It is a more manageable risk than other options.”

“Finding an existing local business for sale can often be less risky and more satisfying and rewarding than starting completely from scratch,” says Simon Brackley, President and CEO of the Santa Fe Chamber of Commerce. “Aspiring entrepreneurs can enjoy improvements in operations, marketing and strategy rather than starting from the ground up.”

Navigating the Search for a Business

Unfamiliarity with the search process is a major source of concern, according to Ruback and Yudkoff. For many buyers, there are uncomfortably many unknowns along the way.

A buyer can drastically limit risk in the area of search success by working with a broker. According to an International Business Brokers’ Association Market Pulse survey, “Dating back to the earliest Market Pulse surveys in 2012, surveyed advisors consistently report that approximately 49-50% of their engagements closed in a successful transition while half are terminated. This closing ratio is approximately twice the accepted industry standard of anywhere from 18% to 30%, depending on deal size.”

Buying a Small Business

Furthermore, according to IBBA, it is an especially good time for people looking to buy a business in the range of $500,000 or less. This is the range of most small businesses for sale in New Mexico. “Small business confidence is at a record high, with the longest stream of small business optimism in history.”

A broker further helps to mitigate risk by facilitating negotiations, advising on financing, and setting up support during the transition between business owners. Click here to find out more about how brokers support buyers throughout the search for and purchase of the right business.

Finally, Ruback and Yudkoff suggest that buying a business results in less stress, more success, and higher quality of life in the long run.

“The searcher becomes a CEO of a business. Over time the business evolves to match the CEO, the management team is picked by the CEO, the products and customer base shifts to align with the CEO’s skills and interests, and the CEO is likely to understand the business better than competitors. Plus, the CEO’s significant ownership interest adds both to rewards and stability. In the long run, we think that being a senior consultant involves much more angst than being the CEO of a small business.”

Plus, with good exit planning, owning a business helps you create options for your next phase of life.

Get Started!

If you are considering entrepreneurship through acquisition, congratulations! Click here to get started by looking at our current listings.

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Franchise Opportunities and Tips

Franchise businesses rank as one of the leading business opportunities. Many entrepreneurs opt to buy a franchise business. Franchises offer a host of appealing benefits including stability, a proven concept, as well as a network of established resources.

To see current franchise businesses for sale, click here.

If you are considering exiting your franchise, follow these tips for reselling a franchise business.

Your Guide to Reselling a Franchise

According to recent findings from the International Business Brokers Association (IBBA), experts have declared it’s currently a seller’s market and a great time for owners to consider exiting. To help guide you through your transition, utilize the following four tips.

Consult Your Franchise Agreement

Before you make any significant decisions, be sure to review your franchise agreement. Many franchisors layout specific parameters for franchisees looking to sell their business and some franchisors even offer assistance in the selling process.

In addition to reviewing the agreed-upon selling process, you should also make careful note of any transfer fees or mandatory training for the new owner once your business switches hands. While selling any type of business presents a variety of challenges for owners, reselling a franchise often involves a few more obstacles.

Contact Your Franchisor

After reviewing your franchise agreement documents, contact your franchisor as soon as possible to alert them of your exit plans. During this conversation, consider asking the following questions.

  • Will I receive assistance selling my business?
  • What qualifications must a prospective buyer have?
  • How is my franchise location valued?

While these questions are a great start to beginning your exit process, consider enlisting the help of a certified business broker to provide the best guidance.

Prepare the Business for Sale

To receive the best asking price, ensure your business is in tip-top shape from your books to the building condition both inside and out. Consider investing in small maintenance fixes or even a professional service to obtain an accurate business valuation to further help you obtain desirable offers.

Keep in mind the franchise business industry has grown for the eighth year in a row. The industry’s performance paired with your well-prepared business should provide plenty of offers to consider.

Negotiate a Deal & Exit Your Business

After listing your business for sale, consult with your franchisor about any offers you receive. Depending on the franchisor’s level of involvement with the selling process, any prospective buyers may need to be approved before the sale is final. For tips on exit planning, click here.

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At the Xitech Closing

Congratulations to Matt Baker and Troy Shepard for their acquisition of Xitech Instruments, Inc. 

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