As a business buyer, it is important that you stand out from the crowd. Why? Up to 90% of prospective buyers who enter the business market never buy anything. If you consider this statistic from the perspective of a seller or business broker – 90% of the buyers who initially contact you will wind up a complete waste of your time.
If you are serious about buying a business, you need to make yourself stand out as a part of that all-important 10% of buyers.
If you are a business seller, then finding the all-important 10% is crucial if you want to make the most of your time.
What do business buyers (the 10%) look like? In the most recent demographic study by BizBuySell, The Demographics of U.S. Small Business Buyers & Sellers, the pool of business buyers is diverse in terms of age and ethnicity – but the motivation to buy a business is the same for most.
A key finding of the BizBuySell study was that “younger buyers are more ethnically diverse than their elders: 49 percent of 18 to 29 year-old buyers identify as a minority, compared to 19 percent of buyers in their 50s or older.”
Another key finding was “the number one motivation for purchasing a small business is the chance to be your own boss, cited by 63 percent of all buyers.”
Now that we know what a typical business buyer looks like, how do we apply that information to the actual process of buying a business? We remember that it is far more important how a buyer behaves than what demographic group they fall into.
Serious buyers are willing to sign non-disclosure agreements without a fuss. They understand that they are receiving privileged and confidential information about someone’s business and they respect that confidentiality. Serious buyers take the information they receive and put together a fair offer that has justifiable terms. They don’t waste everyone’s time by throwing in a ridiculous low-ball. Serious buyers also know that the best way to find out what they need to know to make an informed decision is by asking great questions.
What if you are a buyer who doesn’t exactly fit the mold these statistics show? Just remember that the only thing that actually makes a business buyer a business buyer is buying a business. You make yourself stand out from the crowd by cooperating with the business transaction process, by asking questions and by making good offers.
What if you are a seller and the person looking to buy your business doesn’t look like you expected them to? If you are serious about selling then the only thing that should matter is the ability to write you a check. If the prospective buyer is willing to sign non-disclosure agreements, asks great questions and comes up with a fair and justifiable offer – then you’ve lucked out and found your business one of the 10%.
Are you a business buyer who would like to know more about the process of buying a business and standing out from the crowd? Are you a business seller who wants to know more about how to figure out if a buyer is serious? Please leave any questions or comments here and we would be happy to help.
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