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How to Sell a Business: Screen Buyers
Research About Buyers
Understanding what it is like to buy a business from the buyer's viewpoint will help you in identifying qualified buyers.
What it is like to buy a business – the buyer’s viewpoint
Have you thought about what it is like to buy a business?
Well a few years ago, someone asked us this question. Unfortunately, we had an idea but we didn’t know for sure. So what did we do? We put on our buyer’s hat (and underwear – so we could get the full experience) and responded to business-for-sale ads and here is what happened:
- 60-70% of the sellers or brokers did not even respond at all.
- Of those that did respond: Only 25% of them responded in a timely fashion. Most sent a template email with no additional information on the business.
- Most sent lengthy forms to complete – all to be printed, signed and faxed. You are trying to sell me something and you are going to make the process difficult? Most were unprepared to sell, had incomplete information and couldn’t answer basic questions, such as how long of a non-compete they are willing to offer or specific seller financing terms.
The bottom line – The responses were sad. Few were prepared. Few responded and of those that did – the responses were not timely and didn’t provide any information. There were a few solid responses, however, they were very rare.
The right way to respond to buyer inquiries
Respect the buyer’s time. - Looking for a business is an extremely frustrating process. Respond to buyer inquiries promptly and professionally.
Don’t respond to a buyer inquiry with “What do you want to know?” – Please do not do this. This kind of response could not make you look less prepared.
Respond in a timely fashion. – Respond quickly and with more information and clear action steps.
Be prepared. – If you want to sell, then be absolutely sure that you want to sell. Don’t waffle with the buyer and say you are motivated but not in a hurry – buyers don’t want to waste their time.
These are all attitudinal tips. – In the next section, we will explain specifically how to respond to the buyer inquiries.