The buyer is not the enemy
I’ve written before about what a seller’s responsibility is during the sale. As a broker, my job is to market the business, find a qualified buyer, help the seller navigate and negotiate the process, and keep the deal moving. The seller is responsible for making financial documentation available, responding to questions and issues, and making sure the buyer and their team have everything they need to make a decision and close the deal.
But that’s not all there is to it. The seller can make a huge difference in how quickly and how well a sale goes by connecting with the buyer and helping him confirm that this is the right decision right now.
The first thing I ask sellers to do is “do no harm.” I’ve seen sellers treat the buyer like the enemy – it’s not true, and certainly not helpful. Most buyers are individuals who are making one of the biggest decisions of their lives: becoming a business owner or taking steps to expand their company. No matter who they are, they’re taking a risk, and they’re looking for confirmation that this is going to be a good fit for them.
I’ve seen owners act like they’re on trial during the due diligence process. They’re determined not to give any more information than they have to, and they sometimes treat questions and requests for information like an insult. What they don’t understand is that every question – every contact with the buyer and his team – is a chance to make a connection, build trust, and move the deal closer to the finish line. Being unfriendly, defensive, or stingy with information hurts the cause and can even kill a deal.
I try to encourage sellers I work with to tell stories about their business. Talk about why you got into the business and what you’ve enjoyed most about it. Talk about decisions you’ve made along the way and why they made sense for the company. A buyer can read tax returns to figure out what you’ve done, but they can’t get a sense of why without talking to you.
I saw a great example of this on a call with a buyer and seller. The buyer asked why the owner had changed HVAC equipment brands. The seller explained that he was tired of the poor service and parts delays he was getting from the brand. He’d changed because his customers were (justifiably) miserable. The buyer said, “I got rid of them for the exact same reason!” It was a bonding moment that built trust between them and gave the buyer confidence that he understood the market and the products he’d be dealing with.
Telling stories about your plans, your choices, your employees, and your customers will help the new owner get a sense for what’s important to the success of the company going forward. I’ve heard sellers tell a buyer things like “It’s worth your time to be friendly with Joe at the local hardware store. He sends us two or three customers a month.” Let the buyer know that your most demanding customer is also your biggest champion; she tells everyone she knows that you take care of her.
Remember how you felt when you first started or bought this business. You were nervous, scared even. You were making a life-changing decision and taking a huge risk. Conversations with your buyer will help them feel confident during the deal that they’re making the right move.
It’s really about applying the Golden Rule: treat the buyer the way you’d want to be treated. You’re doing more than just selling a company; you’re passing the torch to the person who’s going to carry on your legacy. It’s an opportunity, not an imposition.