The successful sale of a business requires identification of a buyer with three attributes. The first attribute is the buyer must want to own a business in a specific industry. The industry or industries identified by a business buyer to evaluate acquisition opportunities in are traditionally based on their prior work or entrepreneurial experience, interest, and/or perceived future opportunity. A business broker can present a spectrum of industry opportunities to potential buyers, but the reality is a veterinarian looking to purchase an animal hospital is not going to purchase a company that manufactures aerospace components for Boeing, even if the business is walking distance from their home.
The second attribute of a business buyer that will complete an acquisition is they must have the capital, financing capability, or investment sources necessary to complete the desired transaction. Many attractive acquisition opportunities exist in the mergers & acquisitions marketplace at any given time. These opportunities are stratified based on price. The opportunity exists with almost every business for sale for the potential buyer to negotiate with the seller on price, however most sellers will only engage with parties that have the ability to negotiate in “good faith”. A buyer should know their price limit in terms of capability, resources, and risk acceptance prior to initiating negotiations. An experienced business broker will ALWAYS prequalify a buyer financially before facilitating negotiations knowing that failure to complete that activity can result in an inefficient use of a client & their own time and the loss of creditability & trust with a client.
The third attribute of a business buyer that will complete an acquisition is they must have the desire to own a business in a specific community. Buyer objections related to location are the most difficult objections to overcome in the sale of a business because the objections are often rooted in commute time, perception of an area, relationships with friends & family, school attendance by children, and spousal employment. These objections are magnified if acquisition of a business requires relocation to a rural area that offers a different type of community, resources, and services than the buyer’s prior home. Selling a business buyer on relocation of their home and family requires an experienced and knowledgeable business broker that has the ability to highlight the positive characteristics of a given community and connect the buyer with the services & resources necessary to facilitate a smooth transition of ownership. It also requires a business broker with the desire and ability to travel to and work in a community, often far removed from the location of their office and home. It has been definitively established at IBA though successful facilitation of over 4000 transactions involving the purchase & sale of businesses in the Pacific Northwest that “best practice” to achieve a timely sale of a business at a premium sale price is for a business broker to work directly with the seller & buyer with regular in person interaction. It is our professional opinion, that a business cannot be effectively sold from an 100% virtual format and that anyone who tries to complete a transaction in that manner is complicating the transaction, diminishing the quality of communication, and likely negatively impacting the price achieved for the business and the timetable for completion of the sale.
IBA is unique as a business brokerage firm in Washington in that we have the depth of staff, desire, & ability to professionally represent businesses from the Canadian border to the Columbia River and from the Pacific Ocean to the Idaho border. Past transactions facilitated by IBA in rural communities in Washington have included Westwind Marine in Point Roberts; Belle Flora in Bellingham; Enclume Design Products in Port Haddock; Forks Animal Hospital in Forks; Steve Pool Service in Aberdeen; The Overhead Door Company of Yakima; Rae’s Beauty Supply & Salon in Spokane; and The Goddard School in Vancouver. The examples provided also demonstrate the spectrum of industries represented by IBA for sale. Information on all the industries represented for sale by IBA can be found by accessing the following page of our website: https://ibainc.com/industries-served/ Relevant industry experience should not be discounted in the sale of a business. A knowledgeable, experienced business broker will always outperform a less experienced one in the negotiating & facilitating a sale of a business.
The sale of a business in a rural area is a sophisticated, nuanced process requiring experience, knowledge, and a willingness to work directly with the seller & buyer and relevant parties (e.g., local bankers, attorneys, accountants, landlords, etc.) at the location to achieve the best possible outcome. If you are interested in selling a business outside of the Seattle metropolitan area in Washington, we would welcome the opportunity to discuss the potential project with you and convey why IBA has been the preferred business brokerage firm for the sale of businesses & real estate in Washington, regardless of location, since 1975.
IBA, the Pacific Northwest’s premier business brokerage firm since 1975, is available as an information resource to the media, business brokerage, and mergers & acquisitions community on subjects relevant to the purchase & sale of privately held companies and family owned businesses. IBA is recognized as one of the best business brokerage firms in the nation based on its long track record of successfully negotiating “win-win” business sale transactions in environments of full disclosure employing “best practices”.