The Top Ten Reasons Why Business Buyers Don’t
By Don Marshall, Marshall Associates*
Yes, it’s true, not everyone who says or thinks they are a business buyer actually is. In my experience, actual business buyers are as hard to find as attractive businesses to buy. Maybe there’s some correlation. Here are the top reasons which I have found, but this is not a comprehensive list:
# 10. Not Serious: Tire kickers, dreamers, academics, gadflies and the curious
# 9. Experience: Financing the goodwill of a business often requires an SBA loan which examines not only credit history of the buyer, but the related work experience of the buyer.
# 8. Team Players: Both husband and wife may have to agree to place their home up as collateral for an SBA loan.
# 7. No Need/Unmotivated: Comfortable with current role & compensation
# 6. Self Confidence: No place to hide in a small company. You/The Company are always under the spotlight.
# 5. The Numbers Don’t Work: In addition to debt coverage and a cushion, how about a living wage, capital re-investments, and return on investment?
# 4. Surprises: No one likes surprises. Transparency avoids surprises such as with staff problems, competitive challenges, and supplier changes
# 3. Risk Aversion: Owning a business isn’t a guaranteed success.
# 2. FUD: Fear, Uncertainty & Doubt when thinking about a new company, a new industry and/or a new community.
# 1. COLD FEET: It’s a large, personal & financial obligation
For potential buyers, remember the words of Socrates: “Know Thyself.” For realtors, remind your clients of the Lion in The Wizard of Oz and help them find the courage that is needed.
* Marshall Associates is a Main Street Business Broker serving NH small business owners with objective pricing and confidential marketing. www.marshallassociates.biz