Do you like to handle projects around the house on your own? Do you only call in the pros for the really tough stuff? Or maybe you draw the line at electrical or plumbing, where the risk of failure can be much more costly?
If that sounds like you, I can certainly relate. I learned a lot while holding that flashlight for Dad over all those years, to the point that I’m willing to take on almost any home improvement project. Sometimes, though, I try to tackle something I’m not quite qualified to handle. When that happens, I inevitably waste a lot of time trying to fix it, the project stalls, then maybe my spouse gets frustrated, and then at some point, I call in an expert to finish the job. If I’m lucky, I haven’t done more damage than good, but I’d be lying if I said that hadn’t happened more than once.
Many business owners are the ultimate Do-It-Yourselfers. Build the company website? Why not? Customize a CRM? Who knows the business better? Resolve a customer issue? Definitely not delegating that!
But like that electrical or plumbing project gone wrong, trying to sell your closely-held business without an expert advisor is a risk that is rarely worth taking. When owners come to us after they’ve attempted to “DIY” a business sale, the outcome is rarely as successful as if they had engaged us from the start.
Here are some of the challenges and pitfalls of DIYing the sale of your business:
Word can get out quickly when the owner does the outreach. How will employees, customers, or vendors react when a competitor says, “I heard that company was for sale”?
Finding Qualified Buyers
Not all buyers who express interest are worthy of the privilege, and certainly not all are capable of closing a deal. We cannot overstate the importance of having relationships with (or finding) the right buyers and then knowing the right questions to ask.
Effectively Running the Business
A seller’s number one job is to deliver a healthy and successful business to the buyer at closing. The chances of doing so are significantly lower if the owner is also managing the sales process details.
Preserving the Relationship with the Buyer
Often a seller stays involved in the business after closing. Given most owners’ emotions toward their business, it is difficult to negotiate without things getting personal, potentially jeopardizing the relationship with a future employer.
All of the above factors, and others, are critical to maximizing the value of the business, which is often an owner’s most valuable asset.
After all these years, I’ve learned to recognize when a project might be beyond my capabilities. If you are a DIY-inclined business owner, please consult with an expert. The risk of not doing so is just too great.