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“I guess we’re really not ready to sell” was said to me by a client recently. Here’s the backstory. 

I got a call from a past client, with whom we worked together on four prior projects, telling me two companies in his industry, including his top competitor, were interested in acquiring his firm. He asked if I would help him structure a deal. Of course, I said and please send me what you have so far. FYI, this business is in a slow-growth industry, offers very specialized services, and growth comes mainly from acquisitions, which is how my client grew his business. And the business (industry) has suffered a decline due to Covid.

He sent over an offer from one of the firms, I asked if he was happy with the offer, he said, “No, but I’ll sign it and then we’ll negotiate” (I can “see” all the lawyers cringing as they read this). I advised him not to sign it, but he did anyway. Then he retained my services, which started with my telling the buyer my client was confused on the process, and we needed to work out a different deal.

Over the first few weeks many of our conversations dealt with getting some emotional clarity about what he really wants. He bounced from, “I’m happy to leave” to “I want to phase out over three years.” He’s said he’s prepared to take an offer and close the deal but also realizes both could say no. At one point his spouse thanked me for being there, especially regarding the emotional issues.

We’ve got two buyers, two offers, one more overall money, and the other with more guaranteed money early. One buyer is a fast-moving middle market company driven by information, metrics, KPI’s, etc. The other is smaller, slower paced, and more relationship driven. Both offers have an earnout component so one topic I’ve brought up repeatedly is about how his staff will relate to each buyer because my client’s company does not run at super speed. If the management team, or part of it, leave and sales go down so does his ultimate payout.

Due diligence is overwhelming my client and his staff. I suspect one member of the management team is purposely moving slow because he made it known he doesn’t want it sold to a middle-market firm. This person still has dreams of the management team buying the business even though they are short on capital and have never run a business, just divisions of it.

Back to the opening line, about the same he told me he realized they weren’t prepared to sell I was talking to some estate planning attorneys and we agreed with what the Wall Street Journal wrote years ago, that only about 10% or so of business are ready to sell for maximum value and with a smooth transaction.

Given the above, I feel it’s good to revisit my ACTION™ to sell a business in order to maximize price and streamline the selling process a business seller should follow my ACTION plan. Follow this plan and you will set yourself apart from other sellers. ACTION stands for:

Arrange all the affairs of the company 

Coach and counsel the company. Its people, process and systems

Transmit and teach all the good “things” about your firm

 (and those “things” are)

Intricacies that make your company special, i.e. the non-financial factors

Operations and management systems in place that will make a transition smooth 

Numbers, all the financials in understandable form, straightforward with no “tricks” 

Every deal is based not only on numbers and also on the non-financial factors including customers, employees, lease, suppliers, technology, the market, competition and others. In 2020-21 we also have Covid related non-financial factors, some of which include:

  • Government intervention, for example, are you an essential or non-essential business, can your capacity be capped, hours restricted, etc.
  • The safety of your employees, the cost, and the potential liability.
  • The Covid affect – short, medium, and long term.
  • Increased costs for medical insurance, unemployment insurance, employee turnover, and more.


It’s easy for business sellers to get overwhelmed. The requests for information can be staggering, especially if the owner doesn’t want to bring key people into the loop. This is why planning makes the process smoother and buyers more willing to pay at the high end of the fair price range.

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