September 9, 2015
By Don Krier
Response below was sent to a potential client that is dealing with one buyer in lieu of hiring us to take the company to market:
Thank you for your email reply.
I read your email, and all I can do is share with you my 22 years of experience doing this.
Dealing with one buyer can be and is entertaining; it is not the way to get the best deal done for yourself. Think about it for a minute, what if you had 5-10 offers all at once. How would this one buyer act if he was in competition for the business? There is no time pressure for this one buyer to have to perform.
Typically what happens is it drags on and on for months and nothing happens. Ultimately, you end up wasting a lot of time! I can’t tell you how many times I have seen this with potential clients—the story repeats over and over again.
From my experience, this is what you should do…
Tell this buyer that you are hiring a firm to handle it for you; they won’t like it when you tell them that because they know that they will now be in competition. One of the goals of the buyer is to be the only one talking with you; hiring us will be contrary to their objective.
Don't share any information with them. Let us get the material together and create a level playing field of information. Let us put this buyer into the competition along with everyone else. Giving them a head start will only benefit them, it will not benefit you! We will keep them to a timeline, keep their feet to the fire and drive the price up for you. Competition drives the price up, and, ultimately, you will KNOW what the market will bare for your business.
We are still in a very strong sellers’ market at the moment. What we do is cyclical! We don’t know how long this cycle will last; I would not lose time in this market working with just the one buyer, it will not be to your advantage. Timing is of the essence. Right now, your company is properly positioned timing wise, the market is properly positioned timing wise. Don’t miss out on this market working with just one buyer.
You are thinking, “I can do this myself.” You are absolutely right, you know more about your company than anyone else does. Even the guy in the same business as you still does not know YOUR business the way you do. We need your help to sell your business. What we know is what's reasonable and customary in a deal. We have lived through multiple pitfalls and seen what buyers do that can be detrimental to you and the transaction. We can say things to the buyer that you can't and should not say. We can play the bad guy, you play the good guy and remain friends with them. You can remain focused on your business, keeping it profitable. We can focus on creating the competition and moving it forward.
Don't allow yourself to get distracted from your business, stay focused on what you do best and let us do what we do best. We can make sure that you get the best deal possible.
I look forward to your reply.