What does a Business Buyer Look Like?
Are you a Business Seller Looking to Sell Your Business and wondering what does a Business Buyer Looks Like?
Do you represent a Business Seller and are looking for a business buyer for your client- What should you look for in a business Buyer- What Does a Business Buyer Look like?
I am a Florida Business Broker working with both business buyers and business Seller. I am also a Business Buyer. Prior to being a business broker I started and owned my own business of 20 years and utilized business acquisitions along with organic growth to advance my business. I had bought multiple businesses as a stategic business buyer. I am also a business Seller as I actually did sell my own business. The “Business Buyer” I sold my business to was represented by a business broker and we experienced a successful business transition.
The person that bought my business is a business buyer -He is not a Business Buyer Prospect. So much of the work and efforts involved with the process of buying and selling a business is the extensive involvement with Business Buyer Prospects. Very often “business buyer prospects” are referred to as Business Buyers. There is a significant difference between a business buyer and a prospective business buyer. Each deal has 2 sides- a Buyer and Seller. I like to use the term Business Buyer Prospect for someone contemplating an acquisition. Most Prospective Business Buyers dont buy a business. Various business brokers, M&A people, and related professionals have their own personal experiences as to how many “Business Buyer Prospects” turn into actual “Business Buyers”.
Personally I think that anywhere between 75 %-95% of those that state an interest in buying a business do not buy a business. So approximately 9 out of 10 (plus/minus) of these “Business Buyer Prospects” never become “Business Buyers”.
SO What does a Business Buyer Look like? How do they look different than the 75-95% of the “Business Buyer Prospects” that do not buy a business.
I contend that looks have nothing to do with what does a business buyer looks like.
A Business Buyer Acts a certain Way. A Business Buyer acts different than a Business Buyer Prospect.
What Does a Business Buyer Act Like?
1) They have a plan- “When you buy the business in Florida ,and you now live in Chicago-How will you run the Florida business?”
Business Buyer Prospect- “I dont know”
Business Buyer- ” I just sold my house and have a rental in Florida and plan to move there in December”
2) They have funds or funding plans- “How much money do you have available to buy a business?”
Business Buyer Prospect- ” If I find the right business- I can get the money” or ” Im not sure yet”,”I’m not worried about that yet”
Business Buyer- “I have x amount available for down payment on a business, so I know what the maximum I can spend and need to find a business that fit this budget”
3) They understand certain information will be required from them-
Business Buyer prospect- “why do I need to sign this NDA and give you some financial or background information on me? I just wanted to know what the Sellers Taxes look like”
Business Buyer- ” I have returned the requested NDA and personal financial statement. what is our next step”
4) They ACT,they make necessary steps/moves to move the deal forward
Business Buyer Prospect- ” Yes that business looks to be exactly what I said I was looking for but think I will wait to see if Seller drops price or another opportunity becomes available.”
Business Buyer- “Yes that business looks to be exactly what I said I was looking for- what is the next step so I can get closer to ensuring I dont miss out on this opportunity.
What does a business buyer look like? – They are tall, short, fat, skinny, young,old, wearing shorts, wearing dress pants, wearing a dress, have tattoos all over their body. They are from many different backgrounds, they are many different religions and races. They look “normal” like you and I.
When I was growing my business though acquisition and I identified an acquisition opportunity I would worry about not securing that opportunity. I made the decision that the opportunity was good for my company and would be disappointed if I missed out on that business opportunity. I knew I needed to ACT like a business buyer. You wont know what a business buyer looks like based on appearance, “business buyer prospects” and “business buyers” look very much alike. Are you looking to sell your business? As a business Seller you will know what a business buyer looks like by the way a business buyer acts. Are you a prospective “business buyer prospect” and are you genuinely looking to buy a business? I could suggest that you act like a business buyer and you will both stand out from all the others out there looking and also achieve your goal.