As we get into the summer months, a funny thing happens to many prospective business buyers: they slow down their search. Maybe it’s the weather, kids out of school, or vacations, I am not really certain. At the same time, I do not understand and definitely do not agree with this strategy.
In fact, to a large extent, this is the time to accelerate the process.
First, less active buyers in the market between now and Labor Day means less competition for you. This is really important because the market is always flooded with individuals who want to buy a business for sale, or at least “lookers”. It is easier to separate yourself from the crowd if there is less of a crowd altogether.
Next, as we get through the first half of the year, you can have a better perspective on what a company’s financial year will look like. I hate annualized numbers and I never pay any attention to them if less than six months. The only value they have is in comparison with prior years’ results over the same period but one cannot simply take two months of Revenues/Profits and multiply by six to suggest what a year will look like. Conversely, after six months, a business (except those with 4th quarter weighted sales) will have a good general idea where they will wind up..
Also, this is a good season to keep the petal to the metal because many owners who may have put their business on the market at the beginning of the year are now entering the second half and it is still for sale. Some get a bit antsy. Price drops are more common after 4-6 months on the market. And nothing beats a motivated seller.
Finally, the entire process of buying a business is a journey. It is easy to give up and especially if you haven’t made much progress. According to industry statistics, over ninety percent of the people who start looking for a business never complete a purchase (that is why I am also so thrilled that 82% of our clients buy a business in less than six months). In any event, the point being that if you get away from the process it is more difficult to get engaged again. If you have vacation time planned or other activities then obviously that is wonderful but do not put a complete halt to your business buying journey over the summer. There are simply too many good opportunities and reason to not adopt that strategy.
The Business Buyer Resource Center™