what do buyers look for in a business?
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Business Broker Tips | Buying a business | Selling a business

What do buyers look for in a business?

If you’re considering selling your business, you may be wondering… What do buyers look for in a business? By making your business attractive to prospective buyers, you will likely achieve the optimum sale price and the entire business sale process will run more smoothly.

What do buyers look for in a business?

But before you can understand what buyers look for in a business, you must first understand your buyer.

There are many different types of buyers. For example:

  1. The ‘business manager/owner-operator’: This buyer wants to purchase your business and run it themselves. Usually, this is due to a change in lifestyle or ambition to create a work-life that they can control and enjoy. These buyers tend to be persuaded by the business lifestyle and will likely hold the business for many years.
  2. The ‘financial flipper’: This buyer hopes to acquire, improve, grow and then sell your business to make a capital gain. Financials, performance and opportunities for growth will be on their list of priorities.
  3. The ‘corporate strategist’: This buyer is looking to expand their network of like-minded businesses within their industry. Whether it’s expanding their business or acquiring your business as a “bolt-on” because it provides a service they currently do not provide, this purchase is part of their grand plan to combine and grow.

Each of the above buyers focus on different things when looking for a business, and what one may be looking for may be slightly different to the other. Ultimately, by determining what type of buyers to target and to appeal to, you can then understand what may be attractive to them when it comes to preparing your business for sale.

However, regardless of the buyer, several key areas are commonly top of the list when it comes to what buyers look for in a business. These include:

  • Profitability and historical proof of profits to show trends.
  • Ability to operate successfully without the current owner and/or team i.e. the goodwill of the business should not rely on the owner.
  • Stability within the current market. Are they placed well amongst competitors?
  • Opportunities for future growth.
  • Neat and organised financials and operational documents.
  • Good, stable staff in place.

The team at Core Business Brokers will advertise your business on the appropriate channels and present qualified buyers to you, the business owner. If you’re thinking about selling your business and want to get a deeper understanding of the process and what buyers may be interested in your business – get in touch with us today!

Our experienced team will be happy to answer all your questions.

Contact Core Business Brokers today on (02) 9413 2977, or email Roy directly at [email protected] or Rad, at [email protected]

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