If the business is so good, why would the owners sell? Buyers want to know, but they’ll skirt around the question. Here’s a list of plausible reasons.
High on the list of questions buyers have about a pre-owned purchase is, “Why are they selling?” Many buyers will never ask the question directly, but they will often ask lots of other questions to try and find out. This is why real estate agents will beam at you when they announce, apropos of nothing, “the vendor is moving interstate”.
When it comes to selling a business there is always some suspicion that the seller might know something the buyer doesn’t, or that things look too good to be true. So what are some good reasons to sell a business that won’t have a negative impact on buyer sentiment? Here are 10 good reasons to sell:
- My husband might be the next Prime Minister/Premier and so I need to sell to ensure that there is no conflict of interest.
- My partner/important family member received an unbelievable opportunity interstate/overseas and so we are moving and need to sell the business.
- An important family member has a medical condition that will require 24-hour family support so we want to sell the business while it is still going strong.
- I don’t want to sell, I love this business, but I am old and my partner insists that I retire now so that we are still young enough to enjoy our retirement together.
- I have made more money from this business than I dreamed possible and have decided to retire early and live a life of luxury/give it all to charity.
- I have developed a rare medical condition that means I am allergic to (nominate relevant and unavoidable work-related thing) and so can’t keep working.
- The key directors/shareholders have had a personal falling out and refuse to continue in the business together, or sell the business to each other.
- This is a family business and the owners are getting a divorce and need to sell the business as part of the settlement agreement.
- For reasons completely unrelated to this business the owner is in financial difficulty and needs to sell the business to pay of his debts.
- I had been hoping to hand the business on to my son/daughter but he/she has met someone overseas and is going to get married and live there instead.
If you have heard of other reasons for selling that you think should get a mention, please share them with us. Perhaps you might have heard some bad reasons to sell like “we realised there is no market for what we are trying to sell”. Send them in, good or bad.
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Fred Schebesta writes: Just wondering if you had any suggestions for the other side of the fence, i.e. for someone buying a business.
Andrew Kent responds: Absolutely. I will make it the topic for the next blog.