Greetings!
As we navigate our current COVID-19 reality, we know that individual businesses and industries have been impacted differently. Some have closed, others have altered their model and others have seen an increase in business. When we will be on the other side of this and how it will look when we get there are the great unknowns.
There are still those that envision business ownership as their dream or as part of a new chapter. Going forward, buyers will have to anticipate that bank lenders will be conservative as business builds back up. Most banks will be looking for SBA guarantees on their loans to reduce their exposure.
Part of the recently advertised
SBA debt relief
applies to
new 7(a), 504 and microloans
. From the SBA website, “The SBA will also automatically pay the principal, interest, and fees of new 7(a), 504, and microloans issued prior to September 27, 2020” for six months.
Click
here
for a list of SBA lenders in NH based on those processing loans under the “PPP” program. We always suggest that buyers of small businesses go first to local banks that are SBA “preferred lenders”.
Important considerations when looking at a business are the resilience of the business to adjust to changing conditions, what differentiates the business from its competitors, how did it survive this disruption and how is it poised to weather future events.
Some of the most impacted businesses will be restaurants and other food services. Here is a QSR publication quote we like from Micha Magid, the founder of Mighty Quinn’s Barbeque:
“Humanity endures. In the depths of confusion and fear we surrender to ideas that a return to our old normal is distant. We always bounce back. The rubber band gets stretched and tested but the reversion back is inevitable. My crystal ball is no better than yours, but the success of our recovery will be measured by how well we prepare for what’s next”.
The best businesses to look at buying now are those with a good track record, based on a good design, and with products and services that will be required going forward. In other words, basically a time-tested formula.
We hope that you and your loved ones are safe and healthy. We are available if you have any questions.
Leon Parker, President
603.715.1097
