I received a purchase offer for my company. What should I consider first?
If you ever purchased a car, you’re certainly much more experienced than you think. Let me tell you why that is.
1st step: You’ve carefully considered and chosen the model that meets your needs. You’ve compiled a list of dealerships and you’re visiting all of them, one by one. That’s probably what the person looking at your business is doing right now.
What to do? Don’t assume that the person is ready to negotiate but be prepared to welcome them if you want to sell your business. If not, tell him that the 2022 model is no longer available and that you’ll contact him when the new models arrive. Take the opportunity to ask them about the specific model that they’re looking for and how they would like to finance his purchase.
2nd step: The buyer arrives at the dealership. All the staff knows that he’s not an employee and that he deserves royal treatment.
What to do? Let the people around you know that this is a customer. At a car dealership, it’s required to roll out the red carpet and treat the customer well. In a business, it should be the same. All that’s left is to show the buyer what he wants to see, or rather what you think he should see. This is a courtesy visit.
3rd stage: The buyer expresses his desire to go further into the process.
What to do? It’s time to determine what vehicle the customer wants and choose its options. In a business context, the buyer may not want to buy the building. They may be interested in the one-year manufacturer’s warranty in return for your valuable services, but not want the extended warranty.
4th step: Provide a written transaction outline and perform a credit check.
What to do? There might not be a formal sales contract yet, but you’ll find the agreement’s outline in the Conditional Offer to Purchase document. In business, this document is called a Letter of Intent (LOI). After this, the dealership will run a credit check. This step should not be neglected, because no credit means no transaction! In business, sellers often assume that the buyer has the means to fund his ambitions.
5th step: The contract! Just like in the car business, you will be presented with a contract that is difficult to read and full of details. Please take the time to at least read the outline!
What to do? In the highly competitive field of automobiles, there is an increasing number of good advisors ready to help you. In business, your lawyer and accountant will have an important role to play. Take their wise advice in consideration, while ensuring that your wishes are respected and that everyone involved is in sync. A baby-blue car is not a navy-blue car. If your advisors are unsure and hesitant, show them a picture or a color sample 😊.
Yes, we are experts in those types of transactions! Do not hesitate to contact us if a buyer is soliciting you.
Have a good transaction!