While a company’s financial performance is the foundation of a successful sales strategy, buyers are often drawn in by the stories the numbers don’t tell. To get the maximum amount when listing a business for sale, owners must craft narratives that show their companies’ intrinsic value while creating buzz among potential buyers. Here, we will offer some tips on getting a buyer excited about your business and their potential purchase.
The Ingredients of a Successful Business Story
To sell your business in Austin, you’ll need values and goals that can be defined by answering these basic questions.
- Why am I in the industry?
- Which needs do my products and services fulfill?
- What makes my brand unique?
Successful stories start with the answers to these and other questions, and those answers should elicit an emotional response from potential buyers. When an owner’s vision for their company is clear, they’re more likely to attract the right kind of buyers.
Connections Give a Business Its Value
When selling a company—regardless of the figures on its financial statements—the real value is whatever a buyer will pay (within reason, of course). Therefore, it’s essential that sellers connect with prospective buyers on a personal and professional level.
A company’s description in sales letters and marketing materials, conversations had with buyers and brokers, and its brand persona should show buyers its advantages. A business’ story should show that it’s a worthwhile investment—and it pays to have the data to prove it.
Just Be Yourself
Authenticity is essential when gaining and keeping potential buyers’ trust. Over-the-top explanations and tall tales rarely work, and in most cases, they’re easy to spot. Brand histories don’t have to be elaborate. When company owners tell their own stories, they’re more likely to connect with buyers on a deeper level.
Honesty and openness celebrate a company’s unique attributes and its human aspect. By discussing their own challenges, successes, and failures, business owners create person-to-person connections and demonstrate their companies’ admirable characteristics. Every company has a story, which is told in the ways things are done. It’s up to the seller to give potential buyers an open book from which to read and getting a buyer excited about your business versus others under their consideration.
Know the Company’s Potential
Although a history of success and good financials tell part of a company’s story, buyers are more interested in what the future may hold. When telling the story of a business’ growth potential, address factors such as:
- Developments within the industry. Sellers should know whether their markets are building up, slowing down, or in between.
- What gives them an edge over the competition. Even if a company isn’t in a competitive market, it may offer products and services that can’t be found anywhere else. Outlining these differentiating factors may make for a successful sale.
- The company’s location. If a business has brick-and-mortar locations in fast-growing areas, that should be part of the valuation. For instance, there are plenty of barbecue restaurants in Texas, but as people relocate, an increase in foot traffic may level the field between chains and independent business owners.
- The likelihood of growth. Some businesses have untouched potential such as the ability to expand service offerings or add locations, which may be a strong selling point. When putting a business up for sale, make it clear that you’re setting the new owner up for future success.
When business owners tell their stories, they show the buyer who they are and where they came from—and outcomes create confidence in a company’s products and services. Use those outcomes to send a strong message to potential buyers.
Tailor the Message
Owners’ valuation methods may vary depending on whether a buyer will take passive or active ownership of a company. Some approaches allow for owners’ salaries to be considered income; an active buyer will then have an idea of how much they’ll take home.
A passive buyer who isn’t planning to take a cut, however, may see their potential salary as another expense to be paid. That’s just one aspect of a business that could be a benefit to some buyers and a disadvantage to others. When selling a company, think of those to whom you’re marketing it and tailor the message accordingly.
Consider Intangible Assets
Most businesses have aspects that make them great, but those factors may not show up on financial statements. For instance, a local fan base, great online reviews, and loyal employees who will stay on after a sale may turn a potential buyer into a deal closer.
As valuable as a company’s intangible assets are, they are easily glossed over when selling. Before putting the company up for sale, ask family, friends, and coworkers what makes it special and build a story around it. Many owners sell their businesses to relocate, retire, or reinvest, and offering a brief explanation may reassure buyers that you’re not selling because of an impending failure.
Owners know their businesses better than anyone else, and that’s why they should help the broker create the sales pitch. Plan to tell the company’s full story and you will have all the data needed to inform, entice, and manage potential buyers.
Help Buyers See the Big Picture
Storytelling makes it easier for business owners to get prospective buyers excited about buying their business, versus the other twenty businesses that the buyer examines. It simplifies the process of making connections and drawing conclusions, which shows potential buyers how different parts of a company work together to achieve a common goal.
Tell Your Company’s Story With Help From a Business Brokerage
Even the most hands-on business owner may not know the full story behind his or her company, and deep involvement may give them a skewed perspective. By the time they decide to sell, many owners are so burned out that they can’t even think about creating a storyline.
A merger and acquisition advisor or business broker can offer the unbiased point of view business sellers need. We’re focused on figures and performance, but we can also help owners tell their stories in unique and memorable ways. Contact us today to learn how we can help you control the narrative when selling a business. We know that getting a buyer excited about your business is the key to any potential business sale.