Once you’ve finished the process of preparing your business to be sold, listed and advertised it, you’ll obviously be hoping for the offers to roll in. But, once they do, how best to proceed? It may not have occurred to you instantly, but replying to suitors can be one of the key steps in securing a good price for your business and ensuring you find a suitable and reliable buyer.
Here’s the low down on our top tips for replying to potential buyers, to make sure your sale is a success.
The first step has to be to respond to any enquiries as quickly as possible. If you don’t, potential buyers may become frustrated and will possibly begin to look elsewhere.
Requests for information may take time to work through, but it is well worth devoting time to it and responding to requests immediately. Even if this is just a friendly acknowledgement of the message, it can go a long way.
Something like “Thanks for your enquiry. I should be able to send the information requested/answer your questions in the next 24 hours. Thank you for your patience”, will immediately establish a friendly tone to the conversation and help reassure the buyer that you are reliable and professional, albeit busy!
It might be worth offering up your phone number (if not already available), as a quick call can often cover more ground than an email back-and-forth. This leads nicely on to our next tip…
Spot the timewasters
Easier said than done, but being able to spot a genuine lead or a timewaster is a skill that can be honed over time. Preparation can help you here.
One tip is to profile your ideal buyer in your advertisement, listing criteria such as previous experience, key skills, working capital availability. Asking potential suitors about their timescale for the deal or knowledge of your industry can also be helpful.
Finally, living in the age of social media and online platforms like LinkedIn makes it easier to do some digging and learn a bit more about potential buyers.
A good tip for any buying or selling process. As we mentioned earlier, while email can be a powerful and efficient tool for quick communication, nothing beats speaking in person or over the phone to gauge a buyer’s character and suitability.
From here, you should look to move your business onto your potential buyer’s shortlist. Clear and efficient communication can help set you apart from any competition. Again, quick responses are key, as are your responses to specific information requests (more on that below), preparing for common questions, maintaining professionalism, and ensuring clear, unambiguous and accurate communication.
What you should send
Determining what information to send to your buyer, and when, is also key. Be open about what you are prepared to divulge, when, and under what conditions. Buyers will appreciate this.
From a buyer’s perspective, they will typically want more information than you’re willing to provide. Sending over a comprehensive report on your business immediately not only puts you in a vulnerable position, but is a document that could be more valuable further down the line. A “teaser profile” can help pique their interest and engage them in your company.
A good tip here is to outline when you are willing to disclose certain points of information in your advertisement, helping to avoid confusion or frustration.
Protect your information
Buyers will want access to things like sale memorandum early, despite it containing sensitive information. For confidentiality purposes, it is vital that buyers sign and return a Non Disclosure Agreement (NDA) before your provide such information.
Not only is this proof of your seriousness and a test of the suitor’s interest, it reduces the risk that confidential information such as trading accounts or customer data are leaked. Online templates are available and are a good place to start, but they will require tailoring to your company. Electronic NDAs also enable signing in mere minutes.
Be warned: if a signatory breaks an NDA, there is little you can do, but it offers you legal recourse to seek damages and can therefore help to serve as a major deterrent.