Buying a Business, Selling a Business
Ted Leverette Reveals How Business Buyers Are Blindsided By Seller’s Employees
Insights Savvy Business Buyers MUST Detect from Employees of Companies for Sale
- Employees can be the buyer’s BEST reality check.
- Too many buyers are fooled by employees
working for businesses for sale.
LISTEN to my 5-minute interview with a searcher whose deal cratered:
You’ll hear:
- why he (after devoting considerable attention and time) withdrew his LOI
- how to more-flexibly craft an LOI
- a way to anticipate and prevent some of the most deal-killing actions by sellers
- an idea to mitigate the risk of “potential”
- some tips to better-prepare for interactions between buyers and sellers.
You, too, are invited to privately communicate with me about what’s obstructing or bothering you while trying to buy or sell a business. We can make a podcast out of it, keeping confidential your identity. And you’ll benefit from complimentary guidance from me in return for participating. Let’s talk about it.
How the Employees of Companies for Sale
Can Be the Buyer’s BEST Reality Check
Buyers, sellers and their representatives, rightfully, fear interaction between buyers and the seller’s employees; it is fraught with legal and business risk. The good news is that win-win deals can occur when people correctly handle this touchy topic.
One of the major reasons why so many business buyers suffer bad deals is their failure to adequately investigate small and midsize companies for sale . . . from the perspective of a company insider.
- It is vital for buyers, their advisors and sources of financing to detect incorrect information about companies for sale. That’s why I will also explain how to avoid misdirection and misunderstanding while communicating with employees.
- Business brokers and sellers can learn how to prepare themselves and their employees to honestly and effectively communicate with potential buyers. (Don’t be naïve: Buyers will access employees!)
Ted Leverette is going to share with you some of our 500 years collective experience as Business Buyer Advocates ®.
You will get street-smart insight into these questions:
- How important is it to interview the seller’s employees?
- What are the most important questions to ask employees?
- What typical ways are new owners blindsided by employees?
- What about conflicts or integration of my business capabilities with the company’s employees?
- Can I rely upon what employees tell me about the company?
- What HR matters should my attorney review?
- Should I be worried about differing perspectives of employees I interview (i.e., cheerful or unhappy, optimistic or pessimistic)?
- What red flags should I avoid?
- What about contacting former employees?
- What can a buyer gain or lose when talking to company employees without the seller’s permission? (Hint: Don’t do it!)
- What’s the best way to convince sellers to let me interview employees?
- What kinds of employees are the best to interview?
- How can I discover if there are people working for the company but not being paid or not being paid by the seller’s company?
- How can I learn about the company’s history with theft or embezzlement?
- Are there actual or latent costs relating to employees that may not show up on the business’ books?
- What about applicable governmental licenses, training or education requirements?
- How can I evaluate the capability and integrity of key employees?
- How can I zero in on the company’s organizational and cultural attributes?
- How can I compare my managerial style to how the company has been managed?
- What about post-sale retention of employees?
The bottom line: It comes down to balancing risk and reward.
Examining employee relationships may not be as revealing as interviewing key employees. Some buyers choose to forego interviews (especially if sellers won’t permit interviews). Some buyers believe they’ve adequately assessed the company. And they hope they won’t be surprised after closing when employees express their opinions about their employer.
Invest 36 minutes to discover what you need to know.
It, and more, is covered in my books.
Get ahead of other buyers competing with you: Searcher and Search Evaluation ™
Hire Business Buyer Advocate Ted Leverette to educate and guide you through our Street-Smart 22-Step Acquisition Sequence ™. It integrates our six advisory services essential to buyers: Preparing, searching, due diligence, financing, valuing, and dealmaking. We are not a business brokerage. We do not sell franchises or any kind of business.
Improve your search and dealmaking:
Schedule an hour of coaching with Ted Leverette, The Original Business Buyer Advocate ®
Email Ted J. Leverette, The Original Business Buyer Advocate ® Since the 1970s. “Partner” On-Call Network, LLC
