According to an article published in Inc. Magazine ("How to Market Your Business for Sale"), the most frequently asked questions from people selling small businesses have to do with how and where to find buyers. Most small business owners want to find a buyer without the use of a business broker, but that may not always be possible. It all depends on whether the business is in high demand or serving a very specific niche.
In today's competitive business climate, small businesses are getting used to guerilla sales tactics such as outdoor advertising and networking with local business owners. However useful these tactics may be in acquiring new customers, they are less effective in the selling a business, particularly when the owner needs complete discretion and confidentiality.
Unless you're considering a specific competitor as a likely buyer, you will need to offer your business for sale in a manner that doesn't top off creditors, customers, vendors or employees. The only way to cast a wide net for potential buyers is to offer the business for sale without identifying it by name. A business broker can help with this, but it may be just as effective to run a blind ad.
Here are some steps you can take to make important decisions on marketing your business:
- Define who you consider a likely buyer for your business. You may be familiar with the expression, "Fish where the fish are." Your advertising decisions will need to follow this advice, but that starts with figuring out who the "fish" really are. Once you define this ideal buyer, think about where and how you will find him or her.
- Does the person you're targeting need to have certain financial qualifications, licenses or credentials? Are you looking for an individual buyer? A group of investors? Or would you prefer to sell to another business?
- Decide on the best way to reach your potential buyer. When buyer and seller are located in the same general area, the sale will be considered an "intramarket transaction." This describes the majority of sales for small business owners, and they almost always involve a listing in an online business-for-sale directory. In many cases, intramarket transactions involve a local broker, but just like residential real estate it is also possible to complete the sale without a broker.
Target your message appropriately. If you plan to sell without the use of a broker, or intermediary, it is important to match your likely buyers to one of several profiles before determining how you will reach them.
- There are buyers who are only interested in buying a business within a specific market area. Reaching these people is easiest in classified ads, online directories or other places they may be searching. It may also help to ask your accountant, attorney, client or banker for leads.
- Some buyers only wish to buy a business in a specific industry, or vertical, but they often customize their searches based on size, cost, and location. Reaching these buyers may be easiest through trade organizations, publications and websites. Look for connections with industry associations within your industry or professional arena.
- A third type of buyer is looking for a quick-turn business investment, but is likely to search out a wide range of opportunities with excellent growth potential. If your business falls into this category, you might want to reconsider selling unless you know you can attract a fair price. The best way to find these leads may be via a professional business broker.
Regardless of which business you are in, remember that more than 90 percent of prospective buyers shop the online listings. Even when a buyer is using a professional broker, he or she is just as likely to be searching for themselves online, so be sure to promote your business in several directories. Online business directories will help buyers and investors find you, even if they are outside of your industry and market area.
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