Check out these three helpful negotiation tips when buying a business.
Negotiating a sale can be a tricky process, especially when buying a business that is so important to the seller. Buyers must remember how much time and effort a seller has put into their company, and be as amicable as possible. However, buyers also want to get the best price and deal terms, so negotiating requires a balance. Continue reading to learn about three helpful negotiating tips when buying a business.
Start Small
Start by building a good relationship with the seller, so they trust you as a reputable buyer who will offer a fair price. When you start negotiations, always start with small issues first. This helps you start on a good note, as you are likely more open to negotiating items with less importance. Meet the seller’s needs whenever possible to create a strong relationship, so you have a higher chance of negotiating more important terms to meet your demands.
Don’t Be Afraid To Talk About The Price
Many people try to skirt around the topic of money, and buyers may be afraid to offer a price that is too low and insults the seller. However, it’s essential to be upfront with your price, especially if you’ve done your own evaluations and have an amount that is based on the company’s actual worth. Be confident in your price, and know that by leveraging the first offer, you are starting an open conversation that allows you and the seller one step closer to making a deal.
Alternative Solutions
Most business sales don’t go completely smoothly, and you may come to a stalemate with the seller at one point. Stay as open-minded as possible during negotiations, and instead of agreeing to everything the seller demands, look for alternative solutions that both of you will benefit from. For example, if you are up against another buyer and they have a higher offer but unfavorable terms, remind the seller that while you may pay a little less, the deal will close much sooner. Sellers who are nearing retirement may be willing to lose a little money in order to close a fair deal quickly.
Buying With Atlantic Business Brokerage, Inc.
At Atlantic Business Brokerage, our mission is quite simple; we help sellers sell businesses, and buyers buy businesses! Over the past 30 years, ABBI has facilitated the sale of countless commercial properties, businesses, and franchised locations. With our unparalleled knowledge of the business purchase and sale industry and our network of contacts, we offer services to both buyers and sellers that no other brokerage firm can match.
Contact us to discuss your business buying and selling goals today at 410-561-9800, or Toll-Free at 800-279-7569. Email us at [email protected], and follow us online on Facebook and LinkedIn.