Recently, Business Brokerage Press released a study on reasons businesses were sold. They determined, based on the results of that study, that the reason an owner would sell a business had a direct effect on the probability of their business selling at all. Brian Mazar, CEO of American Fortune Mergers and Acquisitions, shares his comments (and issues a challenge) on the released information.
The study listed seven reasons a business owner would state to a potential buyer about why they were selling a business. These reasons (and there probability of sale) were:
- retirement (30-35%)
- health problems or a death (25-30%)
- partnership/family problems or divorce (15-20%)
- burn-out/other business investments (15-20%)
- under-capitalization (10-15%)
- insufficient profits (5-10%)
- profit motivated (0-5%)
In every sale there are two perspectives a buyer considers. The first is their emotional involvement in the deal; how do they “feel” about the business. The second perspective is how successful they think the business will be once they own it. The key, according to Mazar, is to have them feel good about both perspectives. Read on…
