24 Aug Establishing Trust in Your CBRs
When you are creating Comprehensive Business Reviews, or CBRs, it’s important to build trust with your potential buyers. In a recent webinar, Jim Parker discussed the factors involved. Parker is the Founder/Owner of Boss Group International and current Chairman of the Business Brokers of Florida (BBF).
Parker strongly advises that business brokers don’t attempt to hide any “skeletons in the closet.” The bottom line is that the CBR will be 95% positive. The majority of the document is dedicated towards selling and promoting the business. Therefore, it only makes sense to disclose potential problems. When handled correctly, the disclosure of problems can actually be strong asset.
He points to the fact that weaknesses can become strengths. For example, a business with a very poor online presence represents a substantial opportunity for a buyer to improve marketing and communications. Summed up another way, don’t be afraid to include negative information, especially if that information represents an opportunity.
Share Seller Information
Jim Parker believes that one of the most essential part of the CBR should be the section on the current business owner. As he astutely points out, buying a business is radically different from buying a home. When someone buys a home, they usually don’t care too much about the person who they are buying the home from. But buying a business is usually a different experience.
It is important that there is an element of trust between the parties. Parker feels that creating that sense of trust begins with the seller’s section of the comprehensive business review. In the seller’s section, we should get an idea of who the owner is, and this means that business brokers should have ample information about the seller in the CBR. When you interview the seller, you should be able to get the kind of information you’ll need to paint a detailed picture.
Go One Step Deeper
Parker encourages business brokers to ask a wide array of questions so that they know more about the seller’s life including information about their family, their hobbies, interests and more. He believes that pictures of the owner and even his or her family should be included in the CBR.
A potential buyer should be able to pick up the CBR and get a good feel for what the seller is like. If no level of trust is ever established between the buyer and seller, then it will be much more challenging for the deal to be successful.