At some point in the history of your business, you are going to think about selling the business. Your first thought is to sell it to a "friend or relative", ...thinking that it would ensure a future for both you and the business.
But is this really the right thing to do?
This idea usually starts with the best of intentions but ends up with many problems. In most cases, owners tend to over value their businesses. When you work with something for a long time, it is not easy to let it go. An overpriced business is not likely to get financing when the buyer goes to the lender. The "friendly buyer" will also go to great lengths to see that the price is reasonably correct.
This creates tension, and bad vibes between the two "friends" and is just not a good way to go when selling a business.
This is one good reason a Business Broker should be brought into the deal. Let them help establish a fair market price and deal with the other party.
Your friendship will stay in place and the buyer "friend" will feel a sense of fairness is in place. Lastly, you may find that your "friendly buyer" is not a real buyer. The result of working with a Business Broker is that you will now be prepared to deal with additional buyers outside the "friends & relatives" market.
But is this really the right thing to do?
This idea usually starts with the best of intentions but ends up with many problems. In most cases, owners tend to over value their businesses. When you work with something for a long time, it is not easy to let it go. An overpriced business is not likely to get financing when the buyer goes to the lender. The "friendly buyer" will also go to great lengths to see that the price is reasonably correct.
This creates tension, and bad vibes between the two "friends" and is just not a good way to go when selling a business.
This is one good reason a Business Broker should be brought into the deal. Let them help establish a fair market price and deal with the other party.
Your friendship will stay in place and the buyer "friend" will feel a sense of fairness is in place. Lastly, you may find that your "friendly buyer" is not a real buyer. The result of working with a Business Broker is that you will now be prepared to deal with additional buyers outside the "friends & relatives" market.
