American Business Brokers & Advisors
Founder & President

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Professional Intermediary & Market Maker for Privately Held Companies

Advisor • Consultant • Speaker • Market Valuations Involved in Closing 500+ Business Transactions & Over $500 MIL

Author of "The Art of Buying and Selling a Convenience Store"

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10 Common Mistakes Sellers’ Make

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We all make mistakes in life, but when someone is in the process of selling their business you want to make sure you get it right the first time, because chances are you are not going to get an opportunity for a do over. Listed below are some of the most common mistakes I have seen over the years in working with sellers and want to make sure you can learn from their mistakes and save you from making the same mistakes.

Even if you have the financial skills, you’ll have a tendency to overestimate the value. And you are not expected to have the financial skills to be objective in the valuing of your own business. Instead you are a successful operator, which is an art within itself. Just as the selling of a business is the combination of both “an Art and a Science”, which is performed by individuals, who do this full time as their profession just as you work as an operator on a full time basis.
You will take comments made by a buyer personally and perhaps kill the deal. Nobody likes to hear they have any ugly baby and the same is true when you are selling your business. Any negative comments about your business to you will be taken personally regardless of how harden you may think you are. The solution is to get an intermediary to soften the blow and translate the buyer’s comments into requests which will not be taken personally.
There is a reason pro athletes & actors have agents…Because they get more money and better terms when they hire someone to negotiate for them. It is a fact not a myth.
Unrealistic owners are the biggest reason why deals fall through. The number one reason that most sales do not get consummated is the seller is unrealistic about the value of their business. Get the facts and the reality of what businesses like yours are selling for in the current market and never believe anything that you read in the trade magazines as the gospel regarding valuations.
Attempting to sell on your own will devour your time. You know how to run your business…..This is no time to learn how to be an investment banker or business broker.
Different businesses require different kinds of buyers… and different buyers will pay different amounts for a business. You need to know which buyers are paying the most in today’s market, because buyers change with the market.
Finding the right buyer for your business who will pay top dollar isn’t as easy as running an ad in a trade magazine or newspaper and seeing who contacts you. As a seller you want to know who really has the money and are they serious and are they “cherry pickers” or “low ball offers” or do they try to “claw back” on an offer and use the old “bait & switch technique”? Remember time is money and buyers are generally working on your time and your money.
Selling a business involves a structured process that takes time. Generally between 6 to 12 months from conception to closing. It is a very detailed process that not all sellers are up to accomplishing without the guidance from a trained professional who has performed this process many times before.
Just as in sports; if a seller doesn’t have the right team of players in the game he will either get defeated or hurt in some way. What is the right team? An attorney who has experience in business transactions and understands the sale of a business to a buyer and not one’s lifelong golfing buddy.  An accountant who understands the tax system and is not afraid to give good tax advice knowing there is a possibility they will lose your account and is looking out for your best interest.  All too often a seller gets close to the closing table only to realize they can’t afford to sell due to their tax situation. As a seller you need to know how much your partner “The U.S. Government” is going to get from the sale first. Remember it is not always about the sale price of the business, but how much are you going to get to put in your pocket when the sale is complete. And a seasoned and experienced intermediary who has working knowledge of the convenience store industry and knows the players and the process of selling a multi store company.
Selling a business is a lot of hard work. People don’t realize how much work it is to assemble all of the data that is needed by a buyer to get a business sold. There will be lots of past financial and tax records that will need to be provided. Lists of assets that are to be sold. Detailed information regarding environmental and we haven’t even touched on title work, surveys, and purchase agreement issues and negotiations. A lot of transactions will fall apart, because the seller is either not committed to the process or does not have the mental stamina to continue. The solution is to get help with a seasoned intermediary who will coach from the beginning to the end so you are prepared for what is about to happen and in the end you will be celebrating with a large pot of gold to reward you for all of your many hard years of work and not aggravated and empty handed from not being prepared.

Terry Monroe Has Helped More Than 100 Convenience Store Owners Sell Their Business!

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