Thin, No Very Thin Markets

The number of prospective buyers for most privately held businesses is very thin. Often the buyers are limited to only several likely competitors and several investment groups or corporate refugee buyers.

For this reason it is very important to have all your ducks in a row when you start talking to prospects. You don't want a single real prospect to needlessly develop a bad impression. The financial statements should be cleaned up. A sales prospectus should be well thought out and complete. The documents necessary to start due diligence should be in hand. Your pricing structure and potential financing sources (whether mezzanine, SBA, or seller take-back) should be prearranged.

This way when one of the likely buyers expresses interest you can get started on the right foot and keep the momentum moving forward. Nothing can kill a deal faster than the perception that you are not interested because you are not responsive.