Here’s what typically happens. You’ve spent years building up your company to where it is now. You’ve got a buyer who seems interested. You’ve met, you’ve made some small talk, presented the business briefly and the prospective buyer seems to like it otherwise they wouldn’t have requested a second meeting.
Time to be asked some serious questions. But what?
As a matter of course, I prep my sellers for this encounter with an extensive role-play prior to the meeting. Here are some of the typical buyer questions that I will seek a response to:
The best way to frame your answers is to try to understand what is in the buyer’s mind. You can start to frame their perceptions by doing some preparatory research on their website, or any other published data e.g. financial reports, trade magazines prior to their meeting.
- What do your believe their SWOT (strengths, weaknesses, opportunities and threats)’to be?
- What do you think they have to gain from purchasing you?
Many of the questions in this grid are best answered by seeing the situation through their eyes. So, don’t be afraid to ask questions of your own. You may soon discover their Achilles heel, what is it that they really desire about your company?
Finally think also about the eventual merger. It’s not just fixing the price for the sale; it’s the value of the services you may have to provide after the sale. How much is your expertise required to successfully integrate the companies? To transfer the skill sets of your operation? To maintain the peace amongst your own management team and staff. All the best and good luck!
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