Business owners who are thinking about a possible sale often ask these questions: 1) Who is going to know I am for sale? And 2) What are business brokers or intermediaries going to do to help me get the business sold? To continue to educate you about the process of selling transportation companies, this article will address those to two questions.
First, who is going to know your business is for sale? Businesses are marketed through various channels with general descriptions designed to create exposure while protecting the seller’s identity. These general descriptions may share a few investment highlights, general location, annual sales/cash flow, and key deal points. CTA requires our clients to pre-approve anything that goes out into the public to protect confidentiality. To take it a step further, once a buyer expresses interest in a business we have for sale, he or she must sign a confidentiality agreement and provide proof of funds for the transaction in order to view a more comprehensive report of the business for sale. If a buyer is not serious, he/she will drop off at this point. This provision is in place to protect our clients from competitors collecting intelligence in the local or regional market. When a business owner follows this process he is in position to pre-qualify and choose exactly who knows his business is for sale. If the seller chooses to share sensitive information about a sale with employees or friends, there is little any broker or intermediary can do to protect him in the process.
What is a broker or intermediary going to do to help me get my business sold? That is going to vary depending on the broker or intermediary you are talking to. However, many brokers will use the following tools and marketing channels to get your business in front of a prospective buyer.
-Direct Mail
-Telemarketing
-E-Marketing
-The internet -
broker’s company website, IBBA website and other web listing services
-Social media
-Pre-existing buyer database
Utilizing both modern and traditional marketing channels play a role in attracting possible buyers. But in many cases, getting transportation businesses sold hinges on a broker’s ability to find the “right” buyer, to engage them into the buying process, and to educate and guide them through the process until the deal is across the finish line. In many cases, CTA finds that the “right” or best buyer for your business does not always consider him or herself a buyer. He or she is not proactively or even passively pursuing acquisitions. This “right” buyer is often a competitor or someone who already owns a business in or related to your industry. Recognizing this fact, CTA focuses a large part of our marketing effort in developing a profile for the “best buyer.” Many buyers are first time buyers or have very limited experience in the transaction world. They are unfamiliar and often distrust the acquisition process. It is not reasonable to expect these people to clearly understand the financial benefit of acquiring a particular company without professional assistance.
As a transportation industry specialist, Charles Tenney & Associates is able to show buyers how to make money through acquiring transportation businesses better than anyone in the world. It is pretty simple when you think about it. CTA markets your business for sale by focusing on individuals or companies who have the most to gain from acquiring your business and who can (with a little professional guidance) financially justify paying the highest price to you—regardless if they consider themselves to be buyers at the present time. We educate them about the acquisition process, develop trust, and demonstrate how fast they can receive their ROI while creating new cash flow and increasing the enterprise value of their existing company. We also allow them to compare risks and rewards against alternative business development methods.
Marketing a business for sale requires a comprehensive approach. Direct mail, e-marketing, the internet, & social media are helpful tools but they are limited in what they can accomplish for the seller. Make sure your business is positioned to be marketed in a way that leads to a successful business sale.
A successful marketing campaign recognizes that the best buyers may be inexperienced and may not immediately indentify the short and long term value of acquiring a business for sale. It also recognizes that the best buyer may not identify him or herself as a buyer. Targeting the “best” buyer, building trust through education about the acquisition process, and clearly communicating the financial benefits to the buyer must be the core focus of how every transportation business for sale is marketed.
