Business Brokering Buy Sell Business – Worldwide Business Brokers

Selling a Business: FSBOs (Pt 2)

Selling a Business: FSBOs (Pt 2)

31 October 2022: Selling a Business: FSBOs (Pt 2)

Last week’s post – Part 1 of our series on FSBOs – discussed the importance, when selling a business, of pricing that business correctly, something that is virtually impossible to do unless you know what the business is worth. Pricing a business correctly is important it you really want it to sell because no business comes to market in a vacuum. Yours will have competition.

While business brokers know this – and account for it – many business owners think their business is so unique that buyers the world over will be clamoring for the opportunity to buy it. But this is not true, Bucko. Your business is one of hundreds – if not thousands – of businesses that are being sold at any given time in any given area and industry.

The Silver Tsunami

Baby Boomers are heading for the exits, mes amis. And many of them are business owners. For the next 10-12 years a virtual tsunami of businesses is expected to break on the shores of the market in general – and on our industry in particular. If you want to sell yours, you have to be aware that you have some significant competition. And you have to be competitive.

Price has to reflect value. If it doesn’t, buyers won’t even give the business a second look. But price is only one aspect. If you’re priced right, you’ll be competitive. Buyers will take your offering seriously. You’ll get them in the door.

But what’s next? Once buyers are engaged, what other issues must be addressed? Selling a business is not like selling a car, a house, office furniture or widgets.


FSBO is an acronym for “For Sale Buy Owner”. Historically used by real estate agents when referring to home owners that try to sell their own house, it has been gaining currency in business and refers to business owners that try to sell their own business.

To reiterate an example from last week’s post, a business owner trying to sell their own business is analogous to a dentist trying to do his own knee replacement – and it’s one of the top three reasons most business that come to market don’t initially sell.

Just because a business owner has many years of experience selling “stuff” doesn’t mean that experience translates to knowing how to value, market and negotiate the sale of a business.


We offer a comprehensive coaching program  – both group coaching in our Brokers’ Roundtable community as well as one-on-one coaching – tailored to Realtors, business owners , buyers and anyone interested in valuing, buying or selling a business.

If you’d like to learn more, email me at jo*@Wo*******************.com


Selling a business presents a completely unique set of challenges, both financial and legal. But even aside from those challenges, selling a business involves a half-dozen other categories of talent that only training and experience can provide.


Do you know how to sell a business confidentially? Do you even know why that’s important? The answer to both those questions is, “probably not”.

Confidentiality is critical in the sale of almost any business. If news that the business is for sale becomes public, the risk to the business’ well being increases.

  • Customers and clients begin to wonder if they will receive the same products or services at the same prices once new owners take over. As a rule, people are uncomfortable with change. The impending change of ownership of a business that one has patronized for many years, raises concerns and causes customers to start looking for options. This is true not only in retail establishments. Manufacturing, distribution, accounting services, etc. are all subject to the same concerns. If your business manufactures widgets, your customers are sure to line up other sources for widgets if they get wind of the fact that you’re selling.


Our course, “Learn How to Value and SUCCESSFULLY Sell Businesses, teaches you how to accurately value and successfully sell businesses.

Don’t Miss Out on the ComingSilver Tsunami“!

  • Employees will have similar concerns. Will they keep the same hours? Will the benefits be at least the same as they currently enjoy? Both employees and customers will begin to wonder if you’re going out of business – actually closing the doors.
  • Competitors will take advantage of this uncertainty by poaching customers, clients and employees. They may even feed rumors that your business is closing.

Here’s a fabulous example of how this phenomenon works in real life.

A couple of years ago, we posted a story about a couple of owners who didn’t consider – or even understand – the need for confidentiality when selling a business. That post – which you can read in all it’s gory detail hereoutlined the multiple problems that resulted from their decision to announce – in a press release, no less – that they were selling. Some of these problems would manifest in the long term but the biggest was immediate and deadly. To wit, within 30 hours –30 HOURS!the owners were forced to post the following on the business’ FacePlant page:

“It’s amazing how rumors like to spread…
Yes, we are for sale. That’s what happens in business sometimes. BUT…No, and I repeat,

Buyers are concerned about all this, too. Some buyers won’t even consider a business that’s been openly marketed – such as on the MLS if a real estate agent has been involved. Most buyers recognize the risks to the business if confidentiality is not maintained. They’ll pass on yours – and look at one of the dozens of others they can choose from.

Finding Buyers

When we have this confidentiality discussion with business owners, the first question we get is, “How am I supposed to find buyers if I keep the fact that I’m selling confidential?”

Well, that’s a very reasonable question. But it’s not much different than asking your dentist, “How do you know which tooth needs work?” The answer to both questions is “training and experience.”

Finding buyers is a process that requires certain tools as well as time, understanding and focus. There are buyers everywhere. If your business is located in Tulsa, USA, your buyer may be in Chicago – or Santiago, Chile. How do you find them?

And in order to maximize the chances that you’ll get the highest value for your business, it is best to have multiple buyers competing for your business. But how do you find multiple buyers? And how do you handle them?

If you want to get the highest value for your business, it would stand to reason that you have to get that business in front of the highest number of qualified buyers as possible, no matter where they are.

Protecting Your Business

One of the biggest potential dangers when selling a business is not knowing who your potential buyer is. This is an issue that exists on two levels.

First, knowing who your potential buyer is – generally, not specifically – allows you to focus your marketing of the business you want to sell. It also provides the best chance of finding the “right” buyer – someone who will be able to continue to grow the business. This is especially important when the seller is providing some of the financing – which is a component of roughly 80% of small and lower-middle market business transfers.

The second level is that, once you have been contacted by one or more potential buyers, can you vet them? Do you know who they are and what their background is? This is important for several reasons.

For example, in most cases you’ll want someone – an individual or other business – that has the talent to run and continue to grow the business. You might not want to sell your accounting firm to an auto mechanic. Again, this is important from the standpoint of seller financing.

But much more important is to consider what would happen if one of the buyers you’re negotiating with is the proverbial “straw man” on a reconnaissance mission for one of your competitors? If you don’t know who you’re dealing with, you may find that, six months later, your competition launches a new product or service essentially identical to your own. If that happens, the value of your business instantly takes a dive.

The Bottom Line

Last week, I suggested that this was to be a 2-part series on FSBOs but the more we outlined these posts, the more we realized how much would have to be included. In an effort to keep from taking too much of your valuable time, we try to keep these posts to between 1200 and 1500 words. This post is already just a hair shy of 1,800.

So, we going to add two more posts to the series.

Next week’s post will discuss deal terms – issues that most sellers (and the real estate agents they hire) trying to sell their own business never consider – and the importance of focusing your time and attention on what is arguably the most significant factor when trying to get the best value.

The following week, the final part of this series will be the details of two examples from our files of business owners trying, unsuccessfully, to sell their business themselves. Both stories are true and will illustrate numerous mistakes the sellers made and the disastrous outcome of one. (The other example is, even after two years, still inflicting pain.)

I’d like to hear from you. What topics would you like me to cover? How can we tailor these posts to be more useful to you and your business. Let me know in the comments box, below, or email me at jo*@Wo*******************.com.

If you have any questions or comments on this topic – or any topic related to business – I’d like to hear from you. Put them in the comments box below. Start the conversation and I’ll get back to you with answers or my own comments. If I get enough on one topic, I’ll address them in a future post or podcast.

I’ll be back with you again next Monday. In the meantime, I hope you have a safe and profitable week.


Searching For…

We’ve been contacted by a U.K.-based buyer looking for U.S.- and U.K.-based businesses in manufacturing, energy and warehousing and distribution with minimum DE/EBITDA of US$900,000.

If any of you know of something that might fit, please let me know.


#business #businessacquisition #sellabusiness #becomeabusinessbroker #businessbrokering #businessvaluation #MergersandAcquisitions #buyabusiness #sellabusiness #realtor #realestateagents


The author is the founder, in 2001, of Worldwide Business Brokers and holds a certification from the International Business Brokers Association (IBBA) as a Certified Business Intermediary (CBI) of which there are fewer than 500 in the world. He can be reached at jo*@Wo*******************.com

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