"A few tactics business sellers use to inflate market value: deplete inventory; defer asset maintenance and repair; neglect to upgrade assets, staffing or marketing below level of competition; classify owner compensation and perks as business profit; reduce labor cost with fewer or cheaper employees; discount the price (or offer special terms) of a product to a level that cannot be profitably sustained."


"Don’t believe “discretionary” cash flow can pay debt.
Don’t think “discretionary” cash flow is available to finance debt. Is owner’s salary discretionary? Is health insurance? Is depreciation? Absolutely not. Treating these as though they are discretionary expenses is a big mistake. Doing so means you earn less than the business would spend to compensate a manager. It could cause the business to become insolvent and lead to a fraudulent conveyance, which puts your personal assets at greater risk. Use the business’ net profit—after fair owner comp—to retire debt."

Much more on topic:
redacted

Thanks Kyle, but as you can see the original date of this thread is last December, and I've long since moved on from this company (which is still on the market btw). The thread was "necro'ed" (brought back from the dead) when Mr. Leverette commented on it a few days ago.