{"id":1286,"date":"2013-02-03T21:44:43","date_gmt":"2013-02-04T02:44:43","guid":{"rendered":"http:\/\/www.changinglanes.biz\/?p=1286"},"modified":"2016-05-03T18:15:59","modified_gmt":"2016-05-03T22:15:59","slug":"8-questions-youll-be-asked-when-selling-your-business","status":"publish","type":"post","link":"https:\/\/www.changinglanes.biz\/index.php\/2013\/02\/03\/8-questions-youll-be-asked-when-selling-your-business\/","title":{"rendered":"8 Questions You’ll Be Asked When Selling Your Business"},"content":{"rendered":"

Even if your business is still young – less than 2 years old, knowing the answers to this questions will help you grow a profitable asset for your future.\u00a0 One of the most intimidating\u00a0aspects of selling a business can be facing the barrage of questions during the various management presentations to potential acquirers. Even though every meeting will be different, being able to answer these questions, now will only help your business thrive now:<\/span><\/span><\/p>\n

1. Why do you want to sell your business?\u00a0 <\/strong><\/span><\/span>It’s a slippery question because if your business truly does have a bright future\u2014and you want the buyer to believe that’s the case\u2014the obvious question is: \u00a0\u201cWhy do you want to sell it, and why sell it now?\u201d<\/span><\/span><\/p>\n

2. What is your cost per new customer acquired?\u00a0 <\/strong><\/span><\/span>The potential acquirer wants to find out if you have a predictable<\/em><\/span>, economical <\/em><\/span>and scalable <\/em><\/span>formula for finding new customers.<\/span><\/span><\/p>\n

3. What is your market penetration rate?\u00a0 <\/strong><\/span><\/span>The acquirer, with an eye to future growth, is trying to understand how big the potential market is for your product or service and what part of the field remains to be harvested. <\/span><\/span><\/p>\n

4. Who are the critical members of your team?\u00a0 <\/strong><\/span><\/span>The acquirer wants to understand the breadth and depth of your team and determine specifically which members need to be motivated and retained with the new owner.<\/span><\/span><\/p>\n

5. Who buys what you sell?\u00a0 <\/strong><\/span><\/span>Strategic buyers will be searching for any possible synergies between what you sell and what they sell. The more you know about your customer demographics, the better the buyer will be able to assess the strategic fit<\/em><\/span>. If your customers are other businesses, a buyer will want to know what functional role (e.g., training manager, VP of sales and marketing) buys your product or service.<\/span><\/span><\/p>\n

6. How do you make what you sell?\u00a0 <\/strong><\/span><\/span>This question is asked in an effort to size up the uniqueness of your formula for creating your product or service. Potential buyers want to know if you have any proprietary systems that would be hard for a competitor to replicate<\/em><\/span>. For various reasons, they will also want to understand if the creation of your product or service is dependent on any one person.<\/span><\/span><\/p>\n

7. What makes your product truly unique?\u00a0 <\/strong><\/span><\/span>A buyer is trying to understand how big the moat is around your business and what kind of protection it offers from competitors who may decide to compete with you in the future. What have you done to safeguard yourself against the competition?<\/span><\/span><\/p>\n

8. Can you describe your back-office setup?\u00a0 <\/strong><\/span><\/span>Most buyers will try to understand how easily they can integrate your back office into their operation. They’ll want to know what bookkeeping and billing software you use, how customers pay, and how you pay suppliers.\u00a0 Think “Procedures, Systems, Processes” or getting the same results from different employees and service providers.
\n<\/span><\/span><\/p>\n

Of course this is not an exhaustive list, but it\u2019s a good start when you\u2019re preparing to represent your company to your potential buyers. \u00a0\u00a0You can check you “sellability status” for your business with this 15 minute questionnaire at Get My Score\u00a0 <\/a><\/span><\/span><\/p>\n

\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

Even if your business is still young – less than 2 years old, knowing the answers to this questions will help you grow a profitable asset for your future.\u00a0 One of the most intimidating\u00a0aspects of selling a business can be facing the barrage of questions during the various management presentations to potential acquirers. Start thinking about these now – you never know when opportunity will come knocking.<\/p>\n

    \n
  1. Why do you want to sell your business?\u00a0 <\/strong><\/li>\n
  2. What is your cost per new customer acquired?\u00a0\u00a0<\/strong><\/li>\n
  3. What is your market penetration rate?\u00a0\u00a0<\/strong><\/li>\n
  4. Who are the critical members of your team?\u00a0\u00a0<\/strong><\/li>\n
  5. Who buys what you sell?\u00a0\u00a0<\/strong><\/li>\n
  6. How do you make what you sell? <\/strong><\/li>\n
  7. What makes your product truly unique?\u00a0\u00a0<\/strong><\/li>\n
  8. Can you describe your back-office setup?\u00a0\u00a0<\/strong><\/li>\n<\/ol>\n

    Building your business knowing these answers, will help create an Asset for Your Future.\u00a0 Of course this is not an exhaustive list, but it\u2019s a good start when you\u2019re preparing to represent your company to your potential buyers. \u00a0\u00a0You can check you “sellability status” for your business with this 15 minute questionnaire at Get My Score\u00a0 <\/a><\/p>\n

     <\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[10,22,24,28,41],"tags":[50,51],"class_list":["post-1286","post","type-post","status-publish","format-standard","hentry","category-benchmarking","category-organization","category-planning-for-business","category-selling","category-selling-a-business","tag-building-an-asset","tag-selling-a-business-2"],"_links":{"self":[{"href":"https:\/\/www.changinglanes.biz\/index.php\/wp-json\/wp\/v2\/posts\/1286","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.changinglanes.biz\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.changinglanes.biz\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.changinglanes.biz\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.changinglanes.biz\/index.php\/wp-json\/wp\/v2\/comments?post=1286"}],"version-history":[{"count":14,"href":"https:\/\/www.changinglanes.biz\/index.php\/wp-json\/wp\/v2\/posts\/1286\/revisions"}],"predecessor-version":[{"id":3277,"href":"https:\/\/www.changinglanes.biz\/index.php\/wp-json\/wp\/v2\/posts\/1286\/revisions\/3277"}],"wp:attachment":[{"href":"https:\/\/www.changinglanes.biz\/index.php\/wp-json\/wp\/v2\/media?parent=1286"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.changinglanes.biz\/index.php\/wp-json\/wp\/v2\/categories?post=1286"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.changinglanes.biz\/index.php\/wp-json\/wp\/v2\/tags?post=1286"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}