No business is perfect. All are in a state of imperfection, with constant improvement possible. Yet, some business owners who decide to sell their businesses believe that their business needs to be perceived as being perfect in order to attract someone who will buy the business for a good price. Interestingly, this attitude can actually impair the marketability of the business. There are a few reasons for this:
1. Many business buyers want to acquire a company that they can improve by using their talents, skills, and ideas. If the business is positioned as being perfect then it may be difficult to determine how to improve the business and thus it could be a less attractive acquisition.
2. It is extremely important to establish trust with a buyer to get a business sale closed. If a buyer asks about problems or business weaknesses and you respond that there are no problems, it will not be believable and will cause the buyer to question your integrity and to be skeptical about all representation made.
3. If a buyer believes that there truly aren’t any problems and, therefore, no improvements that can be made to the business it may result in a lower price since there is less up-side potential.
If a business buyer has seriously looked at other businesses and understands the realities of business ownership they won’t expect perfection. Consequently, instead of marketing the business as one that is perfect, a better approach would be to share weaknesses of the business but position them as fixable problems that once fixed will add value to the business.
Codiligent Business Brokers – Portland, Oregon based business brokers representing sellers of businesses with $500k – $20 million in annual revenue. To schedule a free consultation to discuss the possible sale of your business you may contact Eric Williams at 503-535-8817 or E@codiligent.com
