If you’re selling a business, you need to not only prepare your business to attract buyers, but also be ready to answer questions from buyers that inquire about the business. For many prospective buyers, the decision of whether or not to buy the business will be heavily influenced by their interactions with the seller. It is therefore important to be able to reply to their questions with honest and satisfactory answers.
A great way to ensure that you provide satisfactory answers to questions from prospective buyers is by anticipating the questions they may ask and preparing answers in advance. Below are some of the most common questions buyers ask.
This is probably one of the first questions a buyer would ask. They may be wondering whether you are opting out of the business as it is no longer profitable or because of other problems. No buyer wants to buy a business and inherit problems. It is therefore important to reassure the buyer of the strengths and potential that the business has.
Please note that it is important to be honest with buyers. If your business is suffering, the truth will be revealed during the due diligence stage. You should therefore be honest and let them know the true reasons for selling the business. The right buyer will still be interested in the business if they can see the potential it has.
Many people that choose to buy a business want to invest in a business that is profitable. Prospective buyers will therefore inquire to determine whether the business is profitable or not. You should be able to provide them with information regarding your business’ financials. Provide loss statements, revenue and cash flow statements. Your statements and IRS tax returns ought to go back at least three years to show how the business has been doing.
Buyers not only want to know whether your business is profitable at present but also whether it has potential for the future. They will want to know what your business’ position in the market is. What products or services do you offer? What differentiates your brand from the competitors? Is there potential to improve the business’ position in the market? What share of the market does your brand currently hold? Many serious buyers will be looking at the potential that the business has.
Are you looking to sell your business? Contact Truforte Business Group for guidance from experienced Florida business brokers. Get more information here.