What do sellers want from buyers?

As you go about the process of buying a business you will find that it is not easy and you will have questions and concerns. If the seller is financing the largest part of the sale he wants to be as sure as he can that he will in fact be paid the balance. Every seller's worst nightmare is that the buyer will come in and destroy his business and he will be left with nothing, so you can see that selling a business creates just as many questions and concerns for the seller. You can often get significantly better price and terms by being aware of the seller's needs and removing some of his or her uncertainties.

1. Resume and Financial Statement.

The more information the seller has on your past experience, qualifications and financial situation, the more likely he/she will accept an offer you make. By extending financing to you, the seller is acting as your banker, and he needs to feel comfortable with you. Remember, once the seller accepts your offer he is committed but you still have contingencies to remove before moving ahead.

2. A Fair Offer.

A fair offer is one that realistically satisfies the needs of both buyer and seller. Frequently a fair offer will vary drastically from the listed price and terms. A knowledgeable broker will help you write an offer that is fair to both parties. A word of caution about "low ball" offers, they are rarely accepted and sometimes damage your relationship with the seller. This could result in reducing your chances of getting the business for a fair price.

3. Reasonable Down Payment.

We've all heard the fairy tale of no or ridiculously low down payments. In the real world , this rarely happens and if it did, you probably wouldn't want it. Every buyer wants to conserve cash but a very low down payment can indicate a buyer's lack of commitment to the business. The number one concern of sellers is the safety of taking a note from the buyer and if the down payment is too low the seller feels it would be easier for the buyer to walk away if a problem arose in the business. If the seller questions a buyer's commitment or seriousness about the business, the seller may not negotiate seriously with that buyer.

4. Removal of Contingencies.

It's wise to remove each contingency as quickly as possible. Be thorough but don't procrastinate, it's to everyone's advantage.