Who Is the Buyer?
There are just as many reasons for buyers to buy a business as there are for sellers to sell. Being serious is likewise applicable to both sides – if a buyer has not made a firm decision to buy the business, the sale will not close.
For illustration, some of the reasons to buy are:
- Fired at job
- Early retirement
- Job dissatisfaction
- Desire for more control and pursuing own dreams
A Buyer Profile
If there was a stereotypical individual buyer, they would look something like this:
A person dissatisfied at their job (or fired) looking for a way to get out of uncomfortable situation. It can be both female and male and their investment capital is usually around 3-5M THB. Money usually comes from own personal savings and family members. This type of buyer has never owned a business before.
Their primary motivation is not money (even though it is important) but rather desire to take life into own hands. They don’t want to work for anyone anymore and understand that leap of faith has to be made by purchasing and operating own business.
Overall, a willing buyer will possess some of the below traits (if not all):
- The desire to buy a business
- The need and urgency to buy a business
- The financial resources
- The ability to make their own decisions
- Reasonable expectations of what business ownership can do for them
Note for sellers – buyers who purchase other businesses strictly for money will rarely ever consider a small business.
What do Buyers Want to Know?
Now when you have some idea of what the buyer might look like, it is also good to know what they might want to know prior to purchasing a business. As a seller, prepare to have answers to the following questions:
- How much money is required to buy the business?
- What is the annual increase in sales?
- How much is the inventory?
- What is the debt?
- Will the seller train and stay on for awhile?
- What makes the business different/special/unique?
- What further defines the product or service? Bid work? Repeat business?
- What can be done to grow the business?
- What can the buyer do to add value?
- What is the profit picture in bad times as well as good?