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OPINION

Do You Feel Lucky Today? Or Do You Want to Take Control of Selling Your Business?

Do You Feel Lucky Today? Or Do You Want to Take Control of Selling Your Business?

M&A advisers and business brokers are busy people. Nowadays the number of businesses for sale is quite abundant, for all sorts of reasons. For the advisers, being able to select the best possible businesses - and business owners! - to represent, however, is not that easy. Qualifying potential clients and filtering out the best prospects is essential in having a portfolio of sellable businesses; this allows them to build not only a healthy business for themselves, but also to be able to provide the best possible service for their clients.

 

The first questions they normally ask business owners who are interested in selling their company are about the business, the sales volume, and how business is doing. The next are questions about the owner, why he or she wants to sell, who is taking the decisions and when do they wants to sell the business.
But maybe the very first question should be: what is the business owner’s budget for selling their business? This question can actually save both M&A professionals and the business owners a lot of time.

 

By asking this question the business owner might have been asked the most important qualifying question of all. By being asked this question a business owner will know if he or she deals with a serious M&A professional or with an opportunistic intermediary that tries to get as many clients as he can and hopes he gets lucky selling one of them. By answering this question he or she will provide the intermediary with a direct insight if the owner is serious and if the business is cash flow positive.

 

Most business owners do not realize the amount of work that is involved in selling a business. Even less understood is the amount of time and resources needed BEFORE a business is actually put on the market.

 

Most M&A professionals should earn the major part of their income by being successful in selling businesses and collecting a commission. So the intermediaries should be careful in their selection of sellable clients. They know that most businesses that are offered for sale will not sell. Depending on the size of the business, this can be as high as 90% (!) of all offered companies. The major reason for this failure is because many owners try to sell their business themselves, or contract an opportunistic intermediary (often a relative or close friend).

 

It is a fact that the success rate of selling increases dramatically with a proper preparation. So if a business owner is serious about selling their business, they seek a professional M&A advisor that tells them what needs to be done, how it is done and when they can expect results.

 

Anyone that offers to do this for "free" is actually saying that he considers the business to be just a sweepstake: you can get lucky if the business is picked, but it will be a matter of random luck. The business and the owner will be treated as another ticket in a numbers’ game: the more businesses they have listed the better their (but not the owners!) chances of selling one.

 

No professional M&A adviser can guarantee a business owner that he will be successful in selling the business, but professional assistance will not only increase that possibility considerably, it will also ensure the business is in the right shape to be sold (and being able to get a better price and payment conditions) and provide for alternative solutions when not sold within a reasonable time frame.

 

So when speaking with an M&A adviser and considering the services and rates he is offering, ask yourself this question: do I feel lucky today, or do I want to take control of my future?

 

In case you want to be in control of your future, please give us a call or send us an e-mail.

 

www.connecor.com

 

Connecor Investments 


 
Connecor is a business transfer agency providing expert transaction management to private businesses and companies during the transition period when the ownership of a business or company changes hands.


 
Offering custom-made solution and expertise, Connecor can assist during either the entire process of ownership change, or during certain steps of the process.


 
Connecor aspires to assist both current and future business owners, even in the same negotiation process. The focus is on the transaction – to get a deal done in the best possible way for all parties involved, believing, all the while, in the synergy of interests, instead of a conflict of interest, between the current and future owners.


 
Connecor is focused particularly on Europe, Southeast Asia and Latin America. In addition to the own dedicated offices in Spain (Barcelona), Cyprus and Hong Kong, Connecor has eight group affiliated offices in Amsterdam, London, Mexico City, Montevideo, Mumbai, Pretoria, Shanghai and Singapore, and associated offices in 30 countries covering every continent.

 

Marios Chiromerides is Managing Director of Connecor Investments in Cyprus.

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