You put a lot of time and effort into making your business the success it is today. Now you’re ready to retire or advance to the next stage in your entrepreneurial journey, but you want to ensure that the business is sold to someone who can take it to the next level. You’ve just gotten an attractive offer, but is this buyer is a good match for your business?
Here are four signs that the answer could be yes.
1. They Respect Your Company Culture
Cultural compatibility is often overlooked when evaluating potential buyers, which is a mistake. If your company has a professional yet laid-back and flexible office culture (think casual Fridays and work from home options) and the prospective buyer appears to be highly bureaucratic in their operating style, they may have a detrimental effect on company morale and even its future success. While you don’t have to be looking for a clone of yourself, your ideal buyer will share your operating philosophy and embrace traditions that don’t hold the company back.
2. They Have Run Similar Businesses or Worked in Your Field
Your ideal buyer will have either worked or run businesses in your field. It’s important to be realistic about the experience factor, otherwise, you risk the deal collapsing in its final stages because the buyer realizes that they lack the skills needed to continue where you left off. At the very least, they should be willing to undergo additional training to bring their competency up to the required levels.
3. They Have Been Successful in Business
A buyer with a proven operating track record is in a good position to keep the momentum going. When they have a demonstrated ability to hire and train solid managers and get along well with employers, vendors, suppliers, and customers, your company will likely be in good hands going forward.
4. They Want to Preserve Continuity
In this instance, continuity refers to maintaining the company image, brand, and even its current workforce. All of these have cumulatively made it the success it is now, and sudden changes will alienate both employees and customers. While there’s nothing wrong with wanting to progress and try new directions, these changes should be implemented gradually, so that those who support the business with their labor and patronage aren’t left reeling.
Taking your time and having a pre-qualifying process that is based on compatibility as well as access to finance can save you a lot of time and regret. While you need a buyer for your business, it should be the right one.
Selling a business is a complex endeavor, but the right legal counsel can make the transaction go more smoothly when you do find the right buyer. At Rosen Law, LLC, our team of seasoned business attorneys will guide you through the legal technicalities of passing the mantle and make sure that the final deal is both valid and positive. For more information or to schedule a consultation, call (516) 437-3400.