Atlanta restaurant sellers can learn how to keep a deal on track when meeting with an interested buyer.
When a buyer visits your Atlanta bar as a customer and decides they are interested they will request a meeting with you to see the rest of the operation. You will find that most buyers and brokers with experience will try to work around your business hours. Regardless if it is early in the morning or late at night, the buyer must understand that they need to be flexible with a business operation. You can also allow the buyer to view the backend operations posing as an insurance agent or other expected person that would visit the business during the daytime hours.
Here are a few ways that you can keep the deal on track during a buyer and seller meeting:
Never Meet Without the Broker
You never want to have a meeting with the buyer without the presence of your broker. This is because the broker can act as your mediator between your wanting to be helpful as possible to the buyer and the buyer wanting to obtain as many tidbits of information as he can. It is important to remember that not all buyers who inquire about your business will do so with the best intentions in mind. If they ask your broker a question and hear an answer that they don’t like chances are they will turn around and approach you with the same question in an effort to get the answer that they are seeking.
Don’t Share Copies of Financial Records
When you meet with the buyer it is okay to review and discuss financial information with a buyer that is pre-qualified however, never share copies of financial records with the buyer. This information should be channeled through your broker to protect your interests.
Don’t Offer a Business Card
Avoid sharing your business card with the buyer because this encourages him to contact you for a different answer than your broker provided which is similar to the scenario we described earlier. If the buyer requests your business card or tries to approach you with questions, always refer him to your broker for the information he needs. Tell your broker that the buyer has attempted to contact you so they can inform the buyer that he is violating the confidentiality agreement.
Be Personable and Brief
Try not to offer too much information during your meeting with the buyer. It is quite normal to be nervous which can cause you to reveal too much information about your business. You do not want to tell the buyer about situations that could raise issues such as telling him that you were once close to bankruptcy and you pulled out of it and built up the business to what it is today. Instead keep your answers brief, focused, and personable.
Don’t Be Late
Make sure you are on time for your meeting with the buyer. If you know your staff leaves at a certain time then schedule your meeting a few minutes or half hour after they leave so you are not held up by concerns or questions from your staff. Being late to the first meeting with the buyer may get the deal started off on the wrong foot.
Say Why You Are Selling
Always make sure you state your reason for selling. Although you may have shared the financial details, buyers always want to know the reason you are selling. When you are providing your reasons you should not reveal any personal information that is compelling you to complete a quick sale. First of all, this is none of the buyer’s business and secondly, it could cause you to lose your leverage with the buyer. So avoid telling the buyer that one of your business partners has cancer and only has six months to live.
It is okay to provide reasons such as disagreements among partners, retirement, lifestyle change, or taking care of your elderly parents in a distant location. These are all reasons that are understandable. Reasons that are not acceptable are age old reasons like you are pursuing other interests which doesn’t make any sense if you’re are currently running a profitable business. If you are involved with a franchise which isn’t doing well financially, it is okay to reveal this information. Chances are the buyer will already know by looking at your financial records.
Avoid Giving Advice
When it comes to legal advice or liquor license advice, avoid it at all costs and leave it to your broker to provide the legal resources and the contact information for the person handling your liquor license. While it is okay to tell the buyer the name of the person that handles your liquor license, avoid giving out any advice such as “The liquor license is no problem and here is all you do.”
Don’t Complain
If you have gotten hosed by your landlord or you realize you paid too much for the franchise this information does not concern the new buyer and may even raise issues that otherwise would not come up.
Don’t Provide Third Party Information
Avoid giving out your landlord or franchise contact information. Until your business is under contract the buyer has no legal right to this information. Furthermore, you do not want the buyer making contact with third parties that you have developed a relationship with. If the buyer happens to disrupt the relationships and then walk out on the deal you are left to clean up the mess. Instead send the buyer to your broker so they can control the third party contact.
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