By Peter Siegel, MBA
USABizMart.com, Business for Sale Financing
It always amazes me when a small business owner or business broker goes to sell a business that they usually don't know how to successfully advertise or market a business for sale. They go to all the trouble of getting it ready for sale, collect all the info needed for the sale, and then "rush" the advertising portion of the process. After posting their limited, ineffective advertising they complain that the buyers they are getting calls from are "unqualified," "unprofessional" and "time wasters."
Hundreds of business buyers interviewed for my book either in person or in my focus groups gave me many valuable insights on how owner/sellers and broker/agents can "get it right" when they go to advertise a business for sale.
1. More Information Is Better than Less
Most (business for sale) advertisers think that less is more—that buyers will be more apt to call about a business for sale if little information is given (the old tease strategy). I have found this has quite the opposite effect on buyers. Buyers in many instances will bypass the business feeling that since there is little information, the broker/agent probably doesn't know that much about the listing and they don't want to waste their time on such a business.
Buyers and successful advertisers on business for sale websites have told me that more is better. In fact when you give a lot of information it gives buyers a sense of comfort—they feel they already know a lot about you before they even meet you. Another reason this idea works so well is that by the time a buyer reads your detailed description in your ad they are 80% pre-qualified when they do call or email you—saving you a lot of time. Buyers tell me that they feel more "trustful" of the seller with this type of advertising, which helps in the negotiating and selling process later down the road.
I understand that confidentiality in many cases is paramount when selling a business, however you can still be detailed about the business being sold without giving out the identity or exact location of the business being sold.
Motivated serious business buyers find it extremely helpful if you write about the following information in the detailed profile part of the ad:
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Length of time in business
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How many employees – part time and full time
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General geographic area of the business location
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History of the business
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How you would grow the business in the future – give them a "vision"
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General industry info – how it's growing, changes etc.
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Competitive analysis
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General info on surrounding geographic area, especially if it's a lifestyle business
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Include great pictures of the business if you can
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Know what your true adjusted net income is and how you figured it
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Write about the financial picture of the business – growth, changes, history, etc
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Let them know if the business is computerized, has a great website, etc.
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Always include multiple phone numbers where you can be reached You will find that the quality of buyers calling you about your ad will be very high and you will spend much less time answering the same old questions over and over.
2. Make Your Ad Stand Out – Feature Your Ad for More Exposure
If you have the advertising option to "Feature" a business and get more exposure by having it appear in the top of listing results or with pictures it is usually worth it—many more serious buyers will see it more repeatedly and respond quicker.
3. Track Your Advertising Results
Make sure you know where your buyers see your ads. Track your results. Ask every caller where they saw your ad. Possible use a different voicemail phone numbers for each media in the early stages to determine where your getting your response. See which sites your emails are coming in from. After you determine where the better, more qualified buyers are coming from stick with that media for your advertising.
4. The First 30 to 45 Days Are Critical
Thousands of motivated buyers will first see your ad when it first comes out and first impressions are important. If you have all the info in your advertising, can explain any nuances over the phone when called, you will have a better chance of a meeting with buyers quickly.
5. Don't Stop Your Marketing/Advertising Until You Have Check in Hand
50% of all offers to purchase businesses are never completed. Make sure you keep your advertising running until you have the final check from the buyer. Make sure you have backup buyers at all times. Keep taking phone calls/emails from interested parties, record their names in a folder and get back to them should things sour with the current buyer. Keep things moving forward at all times. I can't tell you how many times I have received thank you calls from grateful advertisers (owner/sellers and broker/agents) who followed this advice.
6. Get Back to Potential Buyers Immediately
One of the biggest complaints I hear from business buyers about advertisers is they take a too long of time to get back to them. Make sure you call back a buyer within 4-8 hours of receiving their phone call or email. Remember you are in competition with other businesses for sale—they are calling and emailing others also.
7. Putting It All Together
Advertisers who follow the above advise when selling their small business will have over a 90% success rate of selling as long as other aspects of the sales process are in line such as a realistic selling price and terms, etc.
Peter Siegel, MBA, is a SCORE counselor and founder of USABizMart.com and Business for Sale Financing . He is a consultant and author on buying a business, selling a business and business purchase financing, and hosts workshops on these topics as well. He has written three books and currently writes a syndicated small business blog on these topics.
Brought to you by SCORE "Counselors to America's Small Business."
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