The buyer interview is an art. Gleaning the necessary information to qualify a prospect, whilst keeping the buyer at ease, is crucial to developing a relationship and rapport that will lead to a successful business investment.
Having established that a buyer is capable of a transaction, the next step is to provide them with the tools to finish the deal. The impressions and concepts laid out in this meeting form a basis for all subsequent transactions with the buyer. This is where a qualified intermediary excels.
A careful and professional business intermediary will attempt to gain a complete picture of the buyer and their resources and tailor their advice accordingly. Gaining a buyers trust by helping them solve problem areas will eventually lead to a commission on that buyer's transaction.
If, after the first phase of an interview, you find the potential buyer to be unqualified, explain carefully what is missing in their resources and what must be done to upgrade their position.
After you have ascertained that your buyer is in a position to buy, you can arrange for them to come back to some physical viewings at a later date. This allows the buyer time to gather up other decision makers (spouse or financial partner).
As the process of buying or selling a business can be quite an emotional affair, a professional intermediary never allows unqualified prospects to meet a seller, and would never send a buyer out alone.
If a buyer’s first impression of a business is good, they will see problems as opportunities for improvement. If not, they will not want to own that business, even if it meets all of their other requirements. The expression, ‘The sale is made when the wheel hits the curb’ comes directly from this concept.
In accompanying the buyer to viewings, a business intermediary can monitor and react to a buyer's emotional signals. Then, if the buyer seems to have concerns or preferences, the broker will be able to discover why and make adjustments as to which businesses might show in the future.
Another advantage of physically showing the business is that you can monitor any conversation that might take place between buyer and seller, or employees and/or customers, thus protecting the confidentiality of the sale of the business.
After showing recommended businesses to a buyer (three is standard to start with), it is important to try a ‘trial closing’ and ask the buyer what they think of the location. Can they see any way to improve the visibility of the business? You can even ask how they like the way the business looks from the outside, and if they could see themselves working there.
This type of questioning encourages the buyer look at the business seriously and with the eyes of an owner, so that they can visualize changes and improvements they might make. Listen carefully to the buyer's responses and observe his reaction to the business so that you will know how to best serve their interest.
Upon each trial questioning after each business tour, you should make notes as to the buyer's reactions. If, at the end of a three businesses tour, none of the three businesses appeals to the buyer and you've narrowed down an area of non-approval in each of the three businesses, it may be that you need to re-evaluate the criteria that you are looking at.
Be mindful not to show more than three businesses at a time as this can cause a buyer to become a little confused and sometimes overwhelmed. Similarly, don’t show fewer than three – the buyer will then feel that they cannot buy the first thing they see and will be ill-equipped to make comparisons.
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