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Selling a business can be exciting and lucrative, but it’s also a stressful undertaking that may mean giving up quite a bit of control. Preparing yourself to sell your company also means preparing yourself to deal with the types of buyers who are most likely to show interest in your company. Anticipating the unique needs and demands of each buyer can help you negotiate a more lucrative deal.

The Family Member
Particularly if the business is a family company, it’s common to sell to family members. These buyers tend to be familiar with the business culture and the industry. They know what operating business demands. But they may lack the cash to fund the transaction, plan to use the business to employ other relatives or be insufficiently prepared for the demands of running the business. Ensure you only sell to a relative who truly has what it takes to run a business—not just one with an emotional attachment to the company.

The Competitor
Competitors buy one another’s businesses for many reasons. In fact, a competitor may be the person most equipped to successfully run your company. They’re in the industry already and have a deeper understanding of the value of your company. Of course, competitors can also represent themselves as potential buyers when they’re really just snooping for a competitive edge. So an airtight NDA is key here.

Individual Buyers
Individual buyers tend to be a bit older and wiser, making them easier to deal with. Owning a business may be a lifetime dream, often informed by real-world business experience. Working with an individual may also expedite the sales process. However, individuals may have more trouble gaining financing and are not always fully equipped for the demands of business ownership. Make sure you screen them to ensure they’re prepared, both financially and otherwise.

Financial Buyers
Financial buyers are often the most challenging, since they may have a long list of demands. They want to purchase the business for purely monetary reasons, so are not looking to fulfill a dream, join an industry, or gain a job. That doesn’t mean you should dismiss them. You simply must understand that their sole goal is generating more revenue, so they’ll try to save money wherever they can.

Foreign Buyers
Foreign buyers are often well positioned to pay a high asking price. But licensing issues, language barriers, and familiarity with your business’s culture can be significant barriers to the sale process.

Synergistic Buyers
A synergistic buyer is often a great choice. They want to purchase a business that complements theirs, so they may see value where other buyers see only expense. Your role will be to help them identify potential synergies so they can reap the benefits they hope for. Synergistic buyers may be competitors, businesses in other market niches, or PE firms looking to combine several businesses in a portfolio.

Different buyers present different concerns and opportunities. The right broker can help you speak to each potential buyer using the language they understand.