Share This Info:  

Qualifying Business Buyers: Top Business Broker Discusses Top Strategies


Qualifying Business Buyers

A small business owner recently asked the question on a BizBen Blog post, "how do I qualify potential business buyers to see if they are trueley interested in buying my business?"  To completely answer this question I need to know what type of business it is, the asking price and any special goals the Seller is trying to achieve.

I have had cases where the Seller wanted to make sure all employees were retained, treated well, and the Buyer would not relocate the business. So the Seller was very concerned about who bought the business.

We interviewed numerous Buyers and this Seller hand-picked the final buyer to meet her needs as we had multiple Buyers for this business.

I have had others where all the Seller only cared about was the sales price and cash received at the end of the sale. Every case is unique in Business Sales.

In all business sales I will give a very little general information to the buyer without disclosing the specific business and then ask the following questions to each buyer up front in my first phone conversation.

1. Do you have any experience in this type of business? If they say yes, I want to dwell deeper in that subject. Where, when, how long. I want specifics. If it was local, I will know that company or will be able to research to see if they are telling me the truth or giving me a line. I want to know if the Buyer is REAL.  In all my line of questioning I am trying to determine if I want to spend my time with this Buyer.

2. The second question I ask is; How much liquid cash do you have on hand today? Can the Buyer afford my business? Many initial inquires will not be realistic feasible Buyers. I know how much money it will take to complete the sale, how much money, if any can be borrowed against the business. Why would I even want to give a Buyer the name and address of my business if they can't afford it?

3. In line with the cash down payment, there might be other liquidities a Buyer has to purchase a specific business. Stocks, equities, 401k, etc. Depending on the purchase price (large, small), and the Sellers desires, in many larger transactions, I will ask the buyer for proof of funds before disclosing specific information on my business. A real Buyer will not have a problem with this. Buyers who are dreamers and fakes will fight you on this. Real Buyers who have the money they say they have will not be afraid to prove it to you if the business interests them.

4. Non Disclosure Agreement. After I am satisfied the buyer is real and if the Buyer wants to see my business, I want him to sign a Non Disclosure Agreement. During this part it is important to tell the Buyer to be very discrete when viewing my business. Do NOT talk to my employees or customers. If you have any questions come ONLY to me.

Again remember you need to give the Buyer just enough info on your business to get their attention before you can pull the facts out of the Buyer. Do yourself a favor and hire an experience Business Broker to handle this for you. It is a process to qualify Buyers. You can't successfully run your business and do this competently at the same time.

Categories: BizBen Blog Contributor, Deal And Escrow Issues, How To Sell A Business, Selling A Business

Contributor:

Lee Petsas
Areas Served: Southern California
Phone:  714-363-0440
Lee Petsas has been selling businesses with UBI Business Brokers in Southern CA since 1981. In 1999 he became the Owner and Broker for UBI. He has been approved multiple times by Courts as an Expert Witness in the area of Business Valuations.

Comments Regarding This Blog Post


I only send buyers out on a maximum of three listings at a time, and they should be all the same time of businesses, such as restaurants within a certain food type and price point. Some buyers will want information for all types of business, such as mailbox, fast food, laundry mat, etc. too many listings at one time is overwhelming for any buyer to absorb.






  Helpful Resources To Assist In Selling And Buying California Businesses
Steve Zimmerman: Restaurant Broker Specialist, California

Steve founded Restaurant Realty in 1996. He has personally sold/leased over 900 restaurants, bars & clubs, & completed over 3000 valuations. The author of "Restaurant Dealmaker - An Insider's Trade Secrets For Buying a Restaurant, Bar or Club" available on Amazon. Reach Steve direct at 415-945-9701.

Mani Singh CBB, M&AMI, Business Broker, Southern California

I have successfully represented clients sell & acquire multitude of businesses ranging from Gas Stations, Liquor Stores, Markets, Super Markets, Smoke Shops, Postal Stores, Restaurants, General Retail, Auto and Construction related. Phone me for assistance with selling or buying at 951-296-7646 Cell

Jack Oh, Business Broker: LA, Orange Counties

Business broker and real estate services in the Los Angeles and Orange County areas. 10 years experience with great negotiating skills. To sell a business or buy a business in the LA or Orange County Areas phone Jack and his team at 562-787-4989.

Bob Baumgarten, Business Broker: Southern California

National Business Brokerage is a full service brokerage company that has been serving buyers and sellers of Southern California businesses since 1994. We are dedicated to providing the highest standards of professional service for our clients. Phone Bob direct at 949-292-2008.

Ralph Santos, Business Broker: Health Care Specialist

Using my MBA and my perseverance I will make things happen! I provide business brokerage niche services specializing in the hospice and home health care agency industry in the Los Angeles County or Ventura County areas. For either buying or selling assistance please phone or email me today.

William Park, Business Broker - Southern California

Highest Volume Broker in California, Simply Check our HUNDREDS of Listings! Over 25 Associates, Speaking Dozen Languages, Helping Buyers and Sellers of Small Business since 1982, Centrally Located between Los Angeles and Orange Counties, while Riverside & San Bernardino Counties are Very Accessible.

Rick Carlson, Business Broker - Southern California

You Will Never Feel Lost In The Shuffle. Many Brokers Simply Send Out An NDA And That's The End Of Communication. All Buyers Receive A Personal Meeting With An Ace Acquisition Specialist So They Can Recommend The Perfect Business For You. Phone Rick direct at 800-985-4939.

Lee Petsas, Business Broker - Southern California Area

Lee Petsas has been selling businesses with UBI Business Brokers in Southern CA since 1981. In 1999 he became the Owner and Broker for UBI. He has been approved multiple times by Courts as an Expert Witness in the area of Business Valuations.


  Related Articles, Events, Blog Posts, Discussions, Videos, Interviews
Buying A Restaurant With Financing: 5 Options For Restaurant Business Buyers

In this Discussion, Peter Siegel MBA (Business Purchase Financing Advisor at 925-785-3118) discusses financing of purchasing a small to mid-sized restaurant business (with or without real estate). When it comes to financing a restaurant, potential restaurant buyers have many options to choose from.

Buying A Restaurant Can Be Challenging: 3 Key Tips For Restaurant Buyers

People always need to eat; there should be plenty of business. Some restaurant buyers think there is prestige to owning a popular eating establishment. But it isn't an easy business purchase. Peter Siegel, MBA (BizBen Founder, ProBuy & ProSell Program Director at 925-785-3118) reviews this topic.

Specialty Restaurant Broker Discusses Liquor Licenses & Working With The ABC

What you will read in this BizBen blog post you will probably not find in any manual or set of instructions provided by the ABC (liquor licenses in California). This blog post by Jeff Back (SF Bay Area Restaurant Broker Specialist) at 925-736-8200 discusses this topic of liquor licenses in detail.

Why Restaurant Buyers Typically Fail: Best Pro Tips For Buying A Restaurant

Buying a restaurant (no matter what type) can have many pitfalls, and potential restaurant buyers should know how to avoid getting burned! Several restaurant intermediaries and advisors weigh in on this BizBen Discussion about the best way to find, purchase and run a restaurant successfully!

Restaurant And Fast Food Franchises - Successful Tips From Franchise Buyers

Restaurant franchise offerings are among the most popular of the business types potential business buyers seek. What many would-be owners don't realize is that there are specific tips for buying fast food or restaurant franchises that don't necessarily apply to independent restaurants for sale.

4 Reasons To Buy An Existing Gym Or Fitness Business: Jim Thomas Shares Why

For those hoping to enter the fitness industry and own their own business, buying an existing gym operation is the best way to minimize risk and improve your chances of finding success. Gym Broker Jim Thomas shares 4 reasons why buying an existing gym is smarter than starting a gym from scratch.

Buying A Dental Practice: 6 Things You Need To Know About Dentist Practices

Buying a professional service business, like a dental practice, is one of the most profitable ventures you can enter as a dentist. In this blog, Peter Siegel, MBA discusses six things you need to know about buying a successful dental practice or office: finding a practice, financing, deal structure.

Thinking About Selling A Small Business? Know These 8 Factors That Matter

The likelihood of selling a business is often determined by external factors in the marketplace. Here are eight influences on how easy, or difficult it might be when selling a small California business. Peter Siegel at 925-785-3118 (BizBen ProSell Program) explains these factors for owner/sellers.


Parking Lot Maintenance Company For Sale
Veld Group Business Brokerage Los Angeles County
Inland Empire Area Business Broker Mani Singh
Joe Ranieri Orange County Business Broker
Facebook
Twitter
Linkedin
Vlogs and Podcasts
BizBen ProBuy Program
Advertise On BizBen
New Postings Reports On BizBen Sign Up
Business For Sale California Stats
BizBen ProSell Program

BizBen - Where California Deals Get Done! 888-212-4747
7172 Regional Street #364 · Dublin, CA. 94568
BizBen · Copyright © 1994 - 2020, All Rights Reserved



Clost Login


Please confirm your registration by clicking the link we've sent to .

If you can't see it, please check your junk mail folder.

If you have any problems registering, or need assistance with your new BizBen User Account please phone BizBen Customer Support at 888-212-4747.



First Name:*
Last Name:*
Email Address:*
Confirm Email:*
Create Password:*
Confirm Password:*
Phone:
(   
 


You Are A:
Individual
 
Intermediary
 

Email Address:
Password:
 

500 New & Refreshed Detailed Postings Daily
Over 2500 Resources Available On BizBen
Since 1994. Where California Deals Get Done!
Why Restaurant Buyers Typically Fail: Best Pro Tips For Buying A Restaur...
Read More News
Buying A Restaurant With Financing: 5 Options For Restaurant Business Bu...
Read More News