Selling your business to another trading entity has very specific dynamics. Acquisition from the buyer’s perspective carries significant risks. A seller needs to understand and consider these.
A trade buyer always has the option of growing organically or developing technology in-house, so what will motivate them to take the risk and acquire your business? Fully understanding your buyer audience and what is going to motivate them is essential in bringing about a successful trade sale. Further, who is willing to pay a strategic premium?
We encourage all clients considering a sale to work with us on a formal exit planning exercise long before going to market to ensure they have time to create a saleable asset. Factors such as the type of acquirer you’d be happy to see taking on your business, ethical alignment and employee retention all need to be considered. This normally brings about a shortlist of potential buyers amongst which competitive tension drives valuation.