Businesses for sale

“Have your own hare-raising experience. Rabbit farm for sale. Reasonable price. Includes rapidly growing inventory. Call 555-1234 after school hours until bedtime and ask for Jennie or Tommy.”

Why are Jennie and Tommy selling?

1. They have suffered financial reverses, already pawned their Xbox® game equipment, but still are desperate for cash.
2. Jennie and Tommy are overwhelmed by success and lack the experience to manage their business at its larger level.
3. Executives (Mom and Dad) of their corporate parent held a board meeting and decided not to bring a new CEO experienced in managing larger operations.
4. The company no longer fits into long-term strategic goals.
5. The entire world has turned to vegetarian food and cruelty-free clothing, evaporating their markets for rabbit meat and pelts.

Acquireo lists thousands of businesses for sale, and each seller has his or her own reason for selling. Sometimes they’re based on financial reasons, sometimes on management ability, sometimes on personal reasons. Here are some general reasons:

• Owner’s plans change. Perhaps it was started as a side business and grew more successfully than the founders originally anticipated. The owners had to answer the question: do I want to continue in this?
• Not interested in personally taking the business to the next level, but want to find someone who will do so.

If you’re challenged in imagining reasons why an owner would sell their business, think instead about why people sell their homes: financial (taking a profit); lifestyle changes (need more space, want maintenance-free condo); relocation (for job/employment/career: as corporate employee or moving closer to activity centers, such as Hollywood for film); more appropriate neighborhoods or schools for children.

Here’s a quick real-life example. I had a consulting business with a very lumpy income: a couple of months of inflow followed by a couple of months of quietude. So I started a wholesale/retail operation in a totally different industry to even out the ups and downs, and succeeded. But the new business took too much time away from my core consulting business (ordering inventory, managing employees, manning the retail store myself when employees called in “sick”). Like Jennie and Tommy, the business succeeded but no longer fit into long-term strategic goals.

If the seller hasn’t stated the reason, you don’t always know why a seller is selling. Instead of assuming the reason, help yourself by finding out. Even better: if you’re represented by a business broker (and I highly recommend that you are), you have an experienced agent working on your behalf to find out whatever he or she can without revealing information about you.

Then you can have your own hare-raising experience!