Selling a business is an exciting time. When preparing to sell your business it is important to know what kinds of buyers you may encounter. Knowing what types of buyers in advance will help you plan on how you might work with them. Each kind of buyer comes with different objectives. Lets take a look at some.
The Business Competitor
Many business owners turn to their competitors when looking to sell. This makes perfect sense because they are in the same business. Your competition knows the industry and is more likely to recognize the value of what is being offered. When working with this type of buyer, a confidentiality agreement is very important.
Selling To Family Members
Many business owners sell to family members. Most business owners prepare the family member years in advance to take over the running of the business. They understand the industry and what is involved in operating the business. One pitfall about this type of buyer is that the family member may not have enough cash to buy the business.
Individual buyers tend to be a little older. They usually range in age from 40 to 60 years old. This type of buyer frequently brings with them real-world corporate experience. Owning a business is often a dream of theirs. Dealing with an individual buyer helps expedite the process since there are fewer individuals to negotiate with.
The financial buyer can often come with a long list of demands, making these buyers the most complicated to deal with. Don’t dismiss financial buyers. Remember, they want to buy your business strictly for financial reasons. The financial buyer is looking to see that your business is generating adequate revenue.
A synergistic buyer has a business that in some way compliments your business. This makes them an excellent candidate. There is a synergy between businesses. Combining the two businesses will gain a range of benefits, such as access to a new customer base.
EBIT Associates can help you negotiate the sale of your business. Different types of buyers bring different types of issues to the table. We have the experience and knowledge to help you negotiate with different kinds of buyers.