Vetting prospective business purchasersBusiness Sales Article
Every business is different, and so are each owner’s sale requirements. It’s often not just about the size of the cheque, but also knowing the business will be in safe hands. It’s about doing a deal that meets an owner’s lifestyle plans, as well as their long-term aspirations for the business and its employees.
This is why each sale strategy has to be tailored to meet a vendor’s unique needs. However, each sale process must be anchored to the same robust vetting procedure.
A potential buyer must:
1) Know what they want
It’s essential a purchaser has a thorough understanding of the type and size of business they want to buy. Are they a financial buyer, solely interested in your company’s profitability? Or are they a strategic buyer, looking to expand or compliment their existing business? Tyre-kickers with no defined business plan will waste everybody’s time and effort.
2) Be qualified
A purchaser must have the relevant experience to purchase your business, or have plans in place to retain or employ qualified staff. They must have researched the skills needed to ensure a solid future for your business and its employees.
3) Have finance
There’s no point in discussing the sale of your business if the potential buyer doesn’t already know how they are going to fund the purchase. For example, what size deposit do they have, and how do they intend to complete the transaction?
4) Work to a clear timetable
Selling a business isn’t a quick process. Any potential purchaser must be able to provide a timeline going forwards – one that takes into consideration the most suitable exit arrangement for the vendor. This is essential if they want the vendor to remain as an adviser, which in turn has knock-on financial implications for the sale.
The sale period is a crucial time during which an owner has to ensure their business is performing at its peak. It isn’t as simple as putting up a For Sale sign, as this can have negative connotations for clients, vendors and employees. That’s why it’s essential to call on expert advice and not lose focus on the day-to-day running of your business.
At Bayleys, we have a dedicated Business Sales Division, and have spent years compiling databases of genuine prospective business purchasers. We start the process with handpicked qualified buyers, who’ve already outlined to us what they’re looking to achieve by purchasing a business.
Then we protect the business owner by ensuring only the right people are provided information. By the time your staff and customers find out about the sale, a deal will have already been done – leaving you, the vendor, with only one problem: how to enjoy the financial rewards of a lifetime’s hard work.
Contact one of our specialist business brokers for an informed and timely take on the market and how we can achieve a great result for you.