A local small business owner runs a franchise for one of the largest companies in her field but remains mostly unknown except among other local business owners.
“It’s the biggest company that you’ve never heard of,” Claudia Smith said with a laugh.
Smith owns the Kirkland and Redmond franchise of Murphy Business and Financial Corporation, which is located in Bellevue. Her company is one of the largest North American business brokers. She helps other small business owners sell, buy and evaluate their businesses.
“It’s really a lot of fun and it’s wonderful to meet people who’ve worked hard, taken the risk and made a living for them and their family,” she said. “As we all know, small businesses are the backbone of this country. It’s really fun to meet people and get to know them.”
Smith, a Kirkland resident, has owned the franchise since 2016 and said the business market has been very hot lately. Usually, businesses sell after an average of eight to nine months on Smith’s anonymous listing service.
Small business owners approach Smith to sell their business without disclosing its identity. Smith then acts as a mediator and try to find a good match for sellers and buyers.
Eventually, this leads to a meeting between the two parties and the seller ultimately decides if the buyer is a good fit.
“For most business owners, their business is their baby,” she said. “I really haven’t found anyone who just wants to take the money and run. They’re really concerned that their business will be run well and that their customers are going to be treated well.”
Smith sold four businesses in 2017 and leads the northwest region in the number of businesses on her listing with 16. She said she usually uses local attorneys and certified public accountants to close her deals.
“I’m very interested in Kirkland,” she said. “I live here and I love it, so I try to utilize those professionals in the area.”
Some of Smith’s favorite business to work with were two local landscaping businesses. The buyer, who was looking to expand, and the seller became friends.
“That one was a lot of fun,” Smith said.
TIPS OF THE TRADE
Smith also works with small business owners to form an exit strategy for their business. Many of her customers are wanting to sell in the near future, but according to her, the process takes time and it’s important to have an exit strategy from the beginning.
“I’ll work with them to make sure they get the maximum value from (their) business,” she said. “So you don’t really want to wait, you want to be planning…and keep good records.”
Smith estimates that small businesses can get $2-3 back for every dollar they’ve recorded over the years. She usually deals with businesses that make $1 million to $5 million in gross income, which are categorized as “Main Street” businesses in the market.
For first-time buyers, Smith recommends that they educate themselves on the process and decide on what type of business they want to buy.
Smith mentioned a previous buyer who was too nervous about the process and lost out on an opportunity.
“They were looking at a business and they would’ve gotten their money back in two years,” she said. “Which is a very good return.”
For anyone looking to start a business, Smith recommended they also research the process and form a good business plan that will appeal to potential landlords.
“There’s no better time than now to get into a small business,” she said. “The number one thing, I believe, to start a small business is (being) willing to take a risk and have the drive as an entrepreneur to push through all the challenges…there’s nothing like right now.”