In any negotiation, being the person who makes the first move usually puts you at a slight disadvantage. The first-mover tips their hand and reveals just how much he/she wants the asset being negotiated.
Likewise, when considering the sale of your business, it is always nice to be courted, rather than being the one doing the courting. The good news is, the chances of getting an unsolicited offer from someone wanting to buy your business are actually increasing.
According to the Q2, 2014 Sellability Tracker analysis released in July 2014, 16% of business owners have received an offer in the last year, which is up 37% over Q1. Said another way, you’re 37% more likely to get an offer to buy your business today than you were at the beginning of the year.
Big companies are buying little ones for a lot of reasons and the current market conditions are accelerating their appetite: interest rates are low and stock markets are high, which provide the ideal platform for acquirers to realise a return on their investment from buying a business like yours.
So how do you ensure you are on their shopping list? Here are five ways to get noticed by a buyer:
1. Win an award
Getting recognised as the “Widget Maker of the Year” by the Widget Makers Association is a great way to get the attention of acquirers in your industry.
2. Hire a PR person
Engaging a public relations professional to tell your story to the media can get you on the radar of buyers in your industry. A lot of media relations professionals focus on the big mainstream publications, and while these are important, ensure that your PR firm also targets trade publication and industry-specific websites that are read by acquirers in your industry.
3. Host an event
Consider hosting an event (e.g. conference, trade show, summit) for your industry and invite representatives from potential buyers to attend. Being invited to an industry event can be flattering for buyers and it is a good way to get them to notice you as an industry leader.
4. Join a board
If an executive from a company you think would make a natural buyer for your business is serving on a board of directors, consider joining the board. Serving on a board together can be a great way for a buyer to notice you and your business without you having to say you’re for sale.
5. Grab lunch
Consider inviting a senior executive from a potential buyer to share a meal under the guise of discussing trends in your industry. At the very least, you may glean some useful information about how big companies are seeing your industry evolve. At best, your lunch mate may realise that your business could play a key role in helping them grow.
The sale of your business is a delicate dance where it is usually better to be the courted, rather than the courter. Buyers are on the hunt for new businesses, and having them notice you will put you in a position of strength when you get to sit down at the negotiation table.