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Are you performing proper due diligence when purchasing a business?

 

The first thing that you should ask yourself when looking at acquiring a business is the purpose of the purchase. Is the objective expansion, market share? competitive advantage? or intellectual property? By defining the direction of this transaction in advance the step to facilitate proper due diligence will solidify the strength of the deal. It is essential to take the following items into consideration during the Due Diligence period.

Financial Evaluation

Financial analysis is an extremely crucial step in the process of purchasing a company and will define the current value in the sale price. The areas that need to be focused on are as follows;

  • Balance Sheet
    • A statement of the assets, liabilities, and capital of a business or other organization at a particular point in time, detailing the balance of income and expenditure over the preceding period.
  • Operating expenses
    • Those expenditures that a business incurs to engage in activities not directly associated with the production of goods or services.
  • Cost of sales analysis
    • Retail: The purchase cost of inventory value of merchandise sold during a stated period plus the cost of direct work.
    • Manufacturing: The production cost or inventory value of goods sold during a stated period.
  • Current valuation
    • The process of determining the current worth of an asset or a company.
  • Revenue
    • Sales from all lines of business

After pursuing the answers to the financial questions, there is further due diligence to be made in the effort to ascertain that the market is ripe for possible expansion. This information will require past, present, and forecasts for the future of the company and industry.

Market Valuation

Market Share

Brand Value

  • How is the company perceived? What is their reputation among those in the industry and their customers?

Product Segmentation

  • What is the line of business?
    • Line of Business: General term that refers to the product/service or related set of products/services that serve a particular customer transaction or business need.

Industry Growth Trends

  • What is the growth rate of the industry?

Customer Demographics

  • How often is the company getting repeat business? What portion of its current business is made up of repeat business?

Operational Efficiency

  • How many employees do they currently have?
  • What is their management style? What are the qualifications and experience of the top management?

How many accounts does the company have?

  • What is the current relationship between the business and its customers?

Where does Lions Assurance Financial fit in?

Lions Assurance Financial brings knowledge, experience, and well-researched insight into the area of professional financial advisory. At Lions Assurance Financial it is our goal to help our clients in the acquisition process and provide risk management services throughout the transaction.

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LIons Financial

Ariel Tavor

Principal

Ariel Tavor is the Founder and Principal Managing Director of Lions Financial. His agenda for Lions Financial is to provide his clients a service that maintains the highest professional value. Specializing in the Business-to-Business market has allowed proficient expertise in providing ongoing consulting services in the focus areas of business advisory, capital markets, and risk management. Ariel works with CEO’s, Capital Investment funds, and Boards of Directors where he advises his clients in matters of Executive compensation, Business Plan Design, Mergers & Acquisitions, Due Diligence, and Asset Financing.

Ariel has 10 years of experience in the financial services industry. He has worked in insurance and investment companies to analyze client’s financial and make suggestions on allocations based on defined objectives as well as maintaining long term relationships. Ariel’s comprehensive experience has allowed him to work closely with CEOs of companies and their executive teams from diverse industries such as trucking, hospitality, commercial real estate, Insurance, manufacturing, and technology. He has helped lead companies through the challenging decisions around – Buy-Sell Agreements, Deferred Compensation, Employee Group Benefits, Succession Planning, Mergers and Acquisitions, Valuations, and Business Sales.

Ariel currently oversees their family office investment group and sits on the Board of Directors of several companies and real estate developments. Their Investment group controls a portfolio of companies in multiple industries. They collaboratively have holdings in companies specialized in – Automotive Distribution- Real Estate Asset Management- Corporate Travel- Ink Mailing Manufacturing, E-Commerce, Financial Services, Management Consulting, Enterprise Technology, and Food Concepts. In recent years there has been a transition into fund allocation towards limited partnership investments in Venture Capital, Private Equity, and REITS within individual underwriting opportunities.

TOP 40 UNDER 40

Leadership Recognition

Ariel Tavor is the founder and principal managing director of Lions Assurance Financial. His agenda for Lions Assurance Financial is to provide his clients a service that maintains the highest professional value. Specializing in the business-to-business market has allowed proficient expertise in providing ongoing consulting services in the focus areas of business advisory, capital markets, and risk management.

TOP 100 PEOPLE IN FINANCE

Industry Recognition

Lions Assurance Financial is a highly successful, independent business consulting and wealth management advisory firm that focuses on three key areas of the financial industry: business advisory, capital markets, and risk management. The experienced team at Lions Assurance Financial focuses on serving the business and wealth management needs of privately owned business generating 3-50 million in revenue including independent business owners, family owned businesses, and business partners. Lions Assurance Financial works with capital providers including investment banks, private equity firms, venture capital firms, capital advisory firms, accredited investor platforms, commercial banks, and speciality finance firms.​

Exeleon

Leadership & Business Feature

What is the fundamental difference between a buoyant company and a not-so-good one, when all the factors are the same?
The reply is simple- expeditious actions. It is the outcome of the ability to form an idea about the situation, find a perfect response,
and then act accordingly. And all that, without an iota of hesitation. Companies that belong to the second group are known to lack this decisiveness, which sprouts from an absence of clarity in vision or rather the faculty of processing the steps mentioned above.​

The Silicon Review

50 Smartest Companies of the Year

An effective risk management consultant will help individuals and organizations evaluate their risks and develop a plan to counter their losses. Risk management is a complex process, and there is no one-size-fits-all process that all consultants can use. However, there are certain conventional methods that a consultant will use to help you protect your organization from risk. A risk management consultant should be capable of identifying the unique risk that your business is exposed to and carefully evaluating the scenarios. One of the most critical steps in the risk management step is to discover and list all the expected and unexpected risks. There are various advisory firms that can help you mitigate risk and take care of your business’s financial aspect, but one firm that stands out from the rest is Lions Financial. The company is an independent financial services & business advisory firm based in New York. In conversation with Ariel Tavor, Managing Director of Lions Financial. Lions Assurance Financial is a highly successful, independent business consulting and wealth management advisory firm that focuses on three key areas of the financial industry: business advisory, capital markets, and risk management. The experienced team at Lions Assurance Financial focuses on serving the business and wealth management needs of privately owned business generating 3-50 million in revenue including independent business owners, family-owned businesses and business partners. Lions Assurance Financial works with capital providers including investment banks, private equity firms, venture capital firms, capital advisory firms, accredited investor platforms, commercial banks, and specialty finance firms.