The Wise Buyer’s Guide To Finding The Right Potential Seller

A wise buyer examines all aspects of a potential seller by examining the company’s attributions. If purchasing a restaurant is what a buyer is looking for, they might want to consider the business’ location, its profitability. There are many intangibles for a business buyer to examine.

1. Profitability

If the potential seller’s profits are down, will the buyer be able to flip their business and increase profits? Sometimes if a buyer sees potential, he or she might purchase the company with the intention of “riding out the storm” and wait for the economy to pick back up.

2. Trends

A well informed buyer not only examines national and global trends, but local trends as well. Is the potential business continuing downwards, or is there an opportunity for a rebound? A lucky buyer might be able to pick up a potential seller when it is just beginning to rebound again, and the reason it is for sale might be due to a shift in management or the owner retiring.

3. Intangibles

Does the company have a recognizable brand or product? Has the business done a good job with differentiating itself from others in the industry? Typically, companies that might appear faceless in a sea of others will not have much intangible value.

However, this might be a new opportunity for a new buyer to re-brand and create an intangible.