03 Jan Key Take Aways from Our Seven Part Series on Nuts and Bolts of Selling a Business
Business broker legend, Glen Cooper, covered a great deal of ground in his seven-part series on the Nuts and Bolts of Selling a Business. Let’s recap some of the top ideas, points, and tips that Cooper has provided in this extremely informative seven-part series this year.
There are many foundational elements that you should never lose track of when dealing with clients. For example, clients need to know what the story of their business is. It goes without saying that you need to know that story so that you can properly shape how the business is presented to prospective buyers.
During the series, Cooper placed emphasis on the importance of stories, as it is through stories that humanity organizes information and finds direction. He recommends that business brokers and M&A advisors embrace the fact that in a very real and tangible sense, they are storytellers. He even goes so far as to recommend that you read books on storytelling.
It is critical that you remember human psychology when working both with buyers and sellers. Part of why the art of storytelling plays a key role in buying and selling businesses is that it is through storytelling that key information is shared and sellers can envision themselves as the hero of the story. A buyer wants to know not just the story of the business, but also why the seller is selling.
A sense of purpose and continuity is key for buyers wondering where they fit in the process and whether or not a business is a good deal. It is up to you to craft the story of why a business is a good fit and a good deal for a buyer. You need to convey to the buyer both the past of the business and its potential future. Every serious buyer wants to be able to envision a great path forward for the business.
Buyers are always wondering how they will grow a given business and what can be done better so the business thrives in the future. The seller cannot be counted on to tell the story of their business or even tell the story of why they are selling. Successful business brokers and M&A advisors realize and embrace their role as crafters of story. And good storytelling means crafting a story not just with words, but through picture, ads, and in writing.
Cooper outlines several key aspects of what was covered in the series:
- The importance of the NDA
- “Guesstimating” a good asking price
- Checking comps using BRG and BBS
- Preparing an offering summary
- Understanding what do to with real estate
He also points to the fact that it is important for you to realize that the world around us has changed rapidly in recent years and will continue to do so. Whether it is the sizable impact of the pandemic, environment stress brought on by climate change, or the ever-increasing ability of technology to serve as a distraction, you must always be aware of, and adapt, to the new landscape.
At the end of the day, you must successfully communicate with sellers so that they may craft the story necessary to communicate with buyers. Sellers must understand that there is only a 20% chance of a business selling during the first year and that only a mere 2% of prospective buyers actually do buy.
Every business, every seller, and every buyer are unique. Communicating with buyers and sellers, learning what they want and need, and learning about the business involved is at the heart of all that you do. As Cooper points out, there are “no one-size-fits-all checklist” or approaches for a business. Every time you take on a new business, it’s a different game and a different story.