This
is an actual
training subject
audio recorded from
a live 1-on-1
training seminar.
The text below
follows along the
audio and represents
a sample of the
notes you will be
taking in training.
So why do business
buyers need to buy a business and why do you - as the broker - need to
probe?
Getting out of corporate world
Be there own boss
Investment
Do something different
Family
Status/Lifestyle
Apply skill or trade
Increase market share - Current owners
of the competition
Finding quality business buyers is the easiest yet most frustrating part
of business brokering. Before long you will have dozens to hundreds of
qualified business buyers in your area – REALLY YOU WILL! But they will
frustrate you with their lack of commitment, communication and
knowledge. The better you are at qualifying and streamlining the better
broker you will be. Getting a buyer to concentrate on one listing is the
key to your success and we will show you how.
A.
Who are the business buyers?
A
key component on getting a buyer into offer is getting a great
understanding on why they want to buy. This makes your initial buyer
interview extremely important. You see most business brokers collect
buyer contact info BUT DON”T follow up on them - you will – because you
are going to use your buyers to generate your listings. We cover this
elsewhere herein.
Your buyers can come from any profession at any given moment. You should
consider anyone in your community a potential buyer. There are 3 main
groups of buyers…
Upper Level Managers:
The first group of buyers to discuss are those looking to become
independent and live the dream of business ownership. They will
generally have come from an employment upper level position where they
were either laid off or looking for change. These buyers are usually
ready to buy and have the cash to place on a down payment. This will be
your primary pool of financing prospects. This group is generally high
on potential and lacking experience in the industry.
American Dream Seekers:
The next group in discussion would be the “fringe” player. These are the
people who want a million dollar business with $2,000 down. This group
is generally middle class or lower having never achieved more than a
midlevel position with their employer. This group is filled with dreams
but little idea on the intricacies of buying a business or franchise.
This group will require your psychological and counseling skills.
Financing this group is difficult but not impossible. Part of this
program provides a myriad of financing professionals for most
situations. This group will need strong guidance and honesty. You will
need to help this group compromise and find a business ownership
solution best for all involved.
Entrepreneurs and Current Business Owners:
This has become the largest group of buyers. These are generally
wealthy individuals with experience in buying businesses. This group
includes professional buyers and existing owners looking to open new
locations or businesses. They may or may not have wealthy partners and
supporters coming into play. This group is generally well schooled and
will overrun you if you are not sure of your responsibilities. They will
almost always have experience in buying businesses. They may also
attempt to push you around to get the best deals. You must stand your
ground to this group! If you do stand your ground AND close the deal
then you will have an ally for life. This group tends to generate the
most referrals for you. While they are not “hot” prospects for financing
they can be used to locate other financing prospects.
Buyer Group
sub-categories...
Concrete
Buyers are VERY MOTIVATED buyers who give you specific details on the
business they want. These are generally current owners and the
acquisition/capital companies.
Potential
Buyers are buyers looking for a business that has great potential – even
if it is just breaking even now.
Cash
Business Buyers are buyers looking for a business where they can pocket
a portion of the sales without declaring it
No Cash
Buyers are buyers who want nothing to do with cash changing hands
Turnkey
Buyers are buyers looking for something inexpensive – generally close
down but with equipment etc. in place where they can clean and open.
Franchise
Buyers are buyers are a totally different type of buyer as they want
structure and systems already in place
