Preparing for Transition Day- The first day(s) under new ownership!

June 25th, 2012

Down and Dirty Check List

Think about how the following will be impacted by your merger or acquisition:

  • Name change
  • Accounts receivable
  • Accounts payable
  • Vendor notification
  • Service contracts on equipment
  • Invoices
  • Final paychecks for temporary employees
  •  Timesheets
  • Facilities: leases, security, parking, keys, signage
  • When to notify branch manager and staff
  • Action plan Day One, Week One
  • Memo to transitioned temporary employees
  • Letter to clients  Contract accounts (careful with government contracts)
  • Incentive plans to retain accounts
  • Phones – keep their numbers, forward, timing; voicemail
  • Advertising contracts
  • Website
  • E-mail addresses
  • W-2’s  or T4’s
  • Business hours
  • Press release
  • Job descriptions and comp plans
  • Systems training
  • Passwords, access codes on everything
  • DatabaseBenefits: internal and temp staff
  • Holiday pay
  • Vacation pay
  • 3 month budget
  • Auto allowances
  • Mileage rate
  • Screening policies: background checks, drug testing
  • Insurance policies

For more information or a complimentary confidential discussion, contact:

Bob Cohen at 416-229-6462 or Sam Sacco at 910-509-0691. We can also be reached at or

Sam and Bob have successfully completed over 130 staffing industry transactions. Visit our website for more articles under Resources Tab and Archives and for information at:

How to Value your Staffing Business

June 18th, 2012

Most profitable staffing firms will be valued as a multiple of adjusted EBITDA, which is Earnings before Interest, Taxes, Depreciation and Amortization. Some valuations include working capital (the difference between current assets less current liabilities) as part of their multiple particularly in Professional Staffing Service sectors.

So when discussing multiples it is vital to know what the Buyer is or isn’t including in their multiple number to be sure you are making fair comparisons between buyers. Another area often open to interpretation is which of your adjustments will be acceptable to a given Buyer as stated. In other words and as an example, there may be an adjustment (add back) to normalize the owner’s compensation with a replacement amount i.e. the owners compensation package is $500,000 annually while a replacement package cost is believed by the seller and his/her Advisor that the appropriate replacement cost should be $150,000 per annum. One specific Buyer may accept this figure and allow an add back of $350,000, while another Buyer may believe the replacement cost is closer to $200,000 and a third buyer could argue that they feel they would need to pay $250,000 to hire a similarly qualified replacement manager in that market.

The bottom line is that the multiple is just an expression in dollars that is used to arrive at the appropriate valuation of the business. So, one Buyer’s multiple of 5X EBITDA could represent fewer dollars than a different Buyer’s multiple of 4X EBITDA. This is why it is important to truly understand what the multiple means for each Buyer.

 An experienced Staffing Industry Advisor can assist you in many ways to ensure you maximize the valuation of what is often your largest asset.

To determine the EBITDA of your business:

Start With: Earnings Before Taxes
Exclude: Interest Expense, Financing Cost, Depreciation, Amortization, Donations, Interest Income, Gains or Losses on Asset Sales
Remove: Unusual Professional Fees (i.e., Acquisition, Divestures, One Time, or Personal)
Normalize: Management Compensation to Market Value (Salaries, Wages, Bonuses, Perks, Travel, Entertainment, Automobile, Insurance, Management Fees, etc.)


Note–Not all changes bring EBITDA up, some may bring EBITDA down.

There are other methods of determining the value for less profitable or newer staffing operations which are often expressed in a percentage of annual gross margin dollars generated.

For more information, contact Bob Cohen at 416-229-6462 or Sam Sacco at 910-509-0691. We can also be reached at or          

Sam and Bob have successfully completed over 130 staffing industry transactions. 

There are many more articles on our website at:  and Online Archives.


Avoiding Sales Failures-The most common causes of Sales failure and how to avoid them!

June 11th, 2012

The four the leading causes of failure in sales organizations are:

  1. Planning fall-off. Goals are so large and long-range that salespeople become frustrated in reaching them. It’s better to set realistic goals, with starting points, ending points and fixed durations.
  2. Attitude drop-off. Some salespeople go through periods when their level of caring falls off and complacency sets in. They forget that the prospects are the ones doing the buying. The solution is to know what customers expect and collaborate with them to meet or exceed those expectations.
  3. No longer listening. They fail to learn about the customer’s changing needs because they do most of the talking. Acknowledging what the customer has said and asking related questions is the best way to overcome this barrier.
  4. Burnout. This comes from repetition, boredom, a lack of challenges or not being excited about their work or a combination of all four. Energetic salespeople understand that they are much more likely to be rejected than accepted by a prospect. They accept rejection as part of the life of a salesperson and refuse to become tired or depressed. If the challenge to succeed is no longer there, maybe they need a career change.

Have the courage to fail

Salespeople who refuse to fall victim to rejection have the courage to fail. They recognize that rejection can transform failure into a powerful tool for success and help them develop the skills to find new prospects and turn them into customers.

 An old Sales Manager used to say “ every time you get a no, it brings you closer to a yes; he was a very wise man who would not be defeated.

Top salespeople understand that by avoiding failure, they’re missing new challenges and opportunities.

Credit for the article belongs to Ken Dooley of Sales/ Marketing Business Brief.

For more information or a complimentary confidential discussion, contact:

Bob Cohen at 416-229-6462 or Sam Sacco at 910-509-0691.

We can also be reached at or

Sam and Bob have successfully completed over 130 staffing industry transactions. Visit our website for more articles and information at:

What every salesperson needs to know! Part 2

June 4th, 2012

In Part 1 we discussed how customers might believe certain aspects in the staffing usage such as price and product quality may be the most important aspects,  however,  their behaviors showed the product or service features (quality) and the overall sales experience were the actual determining factors in their usage of staffing services.

We also learned that 55% of what customers described as the “most destructive” behaviors by sales people have easy fixes.

The two areas of concern for customers were (1) failing to have adequate product knowledge and (2) contacting customers too frequently. Only 3 percent said they weren’t contacted enough, suggesting customers are open to fewer, more meaningful interactions.

Fortunately, both damaging habits can be readily fixed.  Staffing companies can address a lack of product knowledge by centralizing content development to guarantee a uniform message and creation of compelling value propositions for customers.

Striking the right balance between contacting customers too much and too little requires understanding their stated and actual needs.

There should be a clear strategy for reaching out to customers based on needs and profit potential, with schedules dictating frequency. The best contact calendars center around events that create value for customers, such as semiannual business reviews, which provide an opportunity to assess customer needs and ensure satisfaction.

 The key is to recognize that customers are also looking to lower their interaction costs, so any contact with them must be meaningful.

 Clearly the sales experience matters, and a good one starts by getting the basics right. A sales manager should ask customers the following questions:

 What are the most influential drivers of the sales experience?

What things are my sales personnel doing that could damage relationships? How does the perception your customers have of your sales force compare to how they view your competitors?

 It is only by knowing and understanding the answers to these questions that companies can begin to identify and pursue the best course to better their overall sales performance.  Building your company sales and profits will one day lead to you gaining more value for your company when you are ready to sell.

We hope you enjoyed this posting.