I’m happy to help callers from all around the world.
David C Barnett, BBA, CMEA, BFC
Business Valuation Specialist
Business Transaction Specialist
Business Finance Consultant
Certified Machinery & Equipment Appraiser
Hundreds of YouTube videos on my subject matter here: http://www.youtube.com/c/DavidBarnettMoncton
My iTunes podcast is here: https://itunes.apple.com/ca/podcast/david-c-barnett-small-business-deal-making/id1234025671?mt=2
Started 5 different companies since 'adulthood.' Sold 2, Closed 2, One still going...
Started a finance consulting practice in 2006
Began brokering the sale of companies in 2008
Bought a Sunbelt business brokers office in 2009, sold in 2011
Brokered the sale of over 35 businesses in 36 months, arranged financing for hundreds of start-ups, acquisitions or expansions.
Helped hundreds of clients through the purchase or sale of a business, more importantly, helped countless people to NOT make a really big mistake.
Has owned up to 5 income properties at a time.
Author of three best-selling business books; 'Invest Local: a guide to superior investment returns in your own community,' 'Franchise Warnings: What you really need to know before you buy' and 'How To Sell My Own Business: A guide to selling your own business without paying a broker's commission.' all available as well as 5 other books on Amazon or from www.DavidCBarnett.com
You have a couple of choices and you need to get tax and legal advice before moving forward.
The UK company could establish a subsidiary in the US. Profits earned there would flow up to the UK parent after local taxes etc. Assets transfered may create liabilities, talk to CPA.
The other way is for you to create a US entity and use it to buy the assets of your UK corp. There are rules around the pricing of the assets, then you'd have to decide how to wind up or deal with the money in the UK corp, again, talk to CPA.
Basically, the value (if any) in the UK entity will likely trigger some tax consequences in the UK. So, no, it's not as easy as just 'moving it over' unless there really is not much of any value.
Hope that helps.
Funny.. I made a video about this not long ago:
The answer is.. It depends on what you negotiate.
The prepaid memberships should be on the balance sheet as 'deferred revenue.'
It's a debt to customers for undelivered service but it rarely appears because most gyms just record each transaction as a sale.
For hundreds of articles and videos on buying, selling, financing and managing small and medium sized businesses, visit my blog at www.DavidCBarnett.com.
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I was once in such an environment.
The company had an interesting way of dealing with the slowdown... they sold vacation time.
Here's how it worked (and it may only help you in 2019)
If you know you don't need a full complement of staff in the last weeks of the year, offer your employees the chance to take an extra week of vacation in that time which will be unpaid.
However, if they do want a paycheck, they can 'buy a week of vacation' by deducting 1/51st of a week's pay from each week's pay over the course of the year.
So a person who earns $1000/wk would have $19.61 taken off each week's pay in order to get a paycheck on the week which is essentially an unpaid absence. The money just goes back and forth.
The effect though is that your labor cost is cut in the slow period of the year.
People get excited about their extra vacation week. Happiness and fun fill the air in the lead-up to 'vacation time.'
Hope that helps.
The easy way would be to purchase points from an established rewards program and give them to your clients.
For example, in Canada we have the Air Miles program. Businesses can purchase points and give to customers. Users can redeem the points for rental cars, hotels, air tickets, etc.
Look for an established program in your country that offers rewards your clients would enjoy and contact them to see if you can buy points in bulk and redistribute them via an online portal.
It depends on what you need from them.
I usually like to define investments in such a way that there isn't someone trying to dictate how the business is run.
That's what happens when you get a partner. They own part of the business and you have to listen to them.
It takes real maturity and organization to make a true partnership work.
If you just need an employee and maybe some of their money as an investment, then you should structure things differently.
I suggest my book, Invest Local, which is full of non-equity ways to structure investments in local small businesses.
Hi, great question.
You determine the value of the business before the partner joins, then you determine the value of what they bring.
You then issue new shares to them.
I made this video which may clear things up a bit for you.
And this one about share dilution:
If you want to discuss your specific circumstances, please feel free to request a call.
You show him the opportunity.
You show him how much you need and how you will spend it.
You show him how he will be able to see what's going on and watch his investment.
You then let him make you an offer.
If you'd like to discuss this particular case, please request a call.
For hundreds of videos on buying, selling, financing and managing small and medium sized businesses, visit my blog at www.DavidCBarnett.com
Here is a website with some additional information:
If you have further doubts, just email Service Canada and tell them what you plan to do and they'll let you know.
The problem with small businesses is that profit is totally under the control of the operator. Lots of personal expenses can get buried in the company to lower taxes.
This is why you don't want to be a minority shareholder.
This deal should be structured as debt.
I do these deals often and wrote a book about it in 2014 called Invest Local. You can get it from Amazon and it's on Kindle and audio formats.
Hope this helps.
If you'd like to discuss the specifics of your case, just arrange a call.