Too many owners think an exit strategy is putting an ad on the Internet. We know that no more than 10% of (supposed) business buyers ever buy a business. We also know these (supposed) buyers tend to congregate on the Internet sites advertising businesses for sale. So when the phone rings it’s usually a tire-kicker and if it isn’t a tire-kicker the seller will probably blow it.
I am making three presentations of, “Without an Exit Strategy you have No Strategy” this week. Those who pay attention to my tips and strategies will not be like the lady who called me a year or so ago. Her partner and her decided it was time to sell so they put an ad on one of the Internet sites. They got a lot of calls and one was from a serious and qualified buyer who happened to be visiting Seattle in the next few days and wanted to meet and discuss the business opportunity. Of course, they had nothing put together and were in a state of panic.
There was not much I could do to help them at that point. They should have called me before running an ad and actually should have called months to years in advance.
The wise owner takes the time to formulate a plan and prepare themselves and the business. The Business Enterprise Institute writes, “The basic law of supply and demand dictates that a glut of sellers will drive down prices. When (not if) this happens, a limited number of dollars will be spent on only those businesses that present the least risk and the greatest potential to the buyer.” An owner can reduce risk and show the most potential when they take the time and effort to prepare the company so it will appeal to the logical buyer for their business.