Let’s connect some dots.
Recently I had three speaking engagements in one week. At two of them the subject came up about how long it takes to get a buy-sell deal done these days. The bottom line is that buyers and banks are more cautious than ever and nosier than ever.
In January the following three items appeared in the press, and show why buyers are so cautious:
- Radio Shack was preparing for bankruptcy. Online sales have killed them.
- Sky Mall declared bankruptcy. People can now play, watch or read on their devices while flying and there’s no need to peruse and buy from a catalog.
- An aggressive shareholder is pushing Staples to merge with or acquire Office Depot, which recently acquired Office Max. The logic is that with Amazon, Wal-Mart, Target and others selling office supplies it would not create a monopoly but the scale is needed to compete.
The connection is that things move faster than ever these days and business buyers see the changing world and want to make sure the company they buy is not going to fall prey to the same fate as those above.
For people buying a business it’s usually the largest transaction of their life, and highly leveraged. They want to make sure they ask the right questions, get the right answers and if there’s any doubt they will ask deeper, more probing questions.
Not only are things moving faster than ever and for a buyer, the recession is still visible in the rearview mirror.