When selling your business, an interesting and important question you should ask yourself is: What is it like to look for a business to purchase from a buyer’s perspective?
A few years ago, someone asked me this question, and unfortunately, although I had a vague idea, I didn’t know what the entire experience of buying a business was like for a buyer. So I put my buyer’s hat on and went looking for a business to buy. I responded to multiple business-for-sale ads, and here is what I discovered:
- Non-response – Between 60% and 70% of the sellers or brokers did NOT respond at all.
- Delayed response – Of those who did respond, only 25% of sellers and brokers did so in a timely manner.
- Cold, canned responses – Most inquiries received a template email in response, without additional information on the business.
- Complicated process – Most sellers and brokers sent forms to complete, including a non-disclosure agreement (NDA). Most forms had to be printed, signed and then faxed back. If you’re trying to sell something, why make the process difficult?
- Lack of preparation – Most brokers and sellers were not ready to sell and had incomplete information. In addition, they were unable to answer basic questions, such as whether they offered a non-compete agreement and for how long, or provide specifics regarding the seller financing terms.
The responses were disappointing because only a few were adequately prepared. And those who responded didn’t do so in a timely way and couldn’t provide any useful information. Yes, there were a few solid responses; however, they were rare.
As a seller, you must demonstrate that you’re ready and serious about selling your business when a buyer contacts you. What you should do as a seller:
- Respect the buyer’s time – Looking for a business is a frustrating, time-consuming process. Respond to buyer inquiries promptly and professionally with more information and clear action steps.
- Be specific – Avoid responding to a buyer inquiry with “What do you want to know?” This type of response makes you look unprepared and is insulting to a serious buyer. Anticipate buyers’ questions and offer accurate, complete information that will help them decide if they want to take the next step to buy your business.
- Commit to selling – Be sure you want to sell. Don’t waffle with the buyer. Don’t say you are motivated to sell if you are not — this wastes the buyer’s time.
Based on my nearly 20 years of experience selling businesses, doing the following actions when responding to buyer inquiries can dramatically increase the chances of getting callbacks and keep the interest of buyers in your business:
- Provide timely responses – Responses should be immediate. You can set up an email program to reply automatically with important information, as well as a specific call to action.
- Reply with unscripted emails – Replies must not read like a template. How can you achieve this? Write your emails in simple, natural, conversational language.
- Provide a summary – The email should contain one to two paragraphs on the business, including what was in the original ad, because most buyers often respond to multiple ads and may forget the specifics of yours. This is also a good opportunity to resell the business and persuade buyers to take the next step.
- Make it easy – Don’t include forms that the buyer must print, sign and then fax back to you. Make the process easier by using technology, such as utilizing email, electronic non-disclosure agreements and online forms.
- Show gratitude – When responding, remember to thank the buyer for their time and acknowledge that you understand how the process of buying a business is often frustrating.
- Build trust – Always include your full name and contact information to help build trust and credibility.
In summary, try to place yourself in the buyer’s shoes when selling your business. If you were a buyer, how would you want the owner of the business you’re interested in buying to transact with you? You would probably want to deal with a seller who answers quickly to your questions, makes the process of buying his business easy for you, and is highly motivated and prepared to sell.
Keeping this in mind when you receive an inquiry from an interested party will increase your chances of finding the right buyer for your business.
To learn more tips on how you can deal with buyers to sell your business successfully, read my book “The Complete Guide to Selling a Business: A Roadmap to the Successful Sale of Your Business.”Business & Finance Articles on Business 2 Community