A buyer's representative has the important task of representing your interests in a business acquisition.
Although you are still responsible for making decisions throughout the buying process, a buyer's representative can make your job a lot easier.
One of the big advantages of hiring a buyer's representative is that you will gain much needed objectivity during the acquisition. A buyer's representative creates a buffer between you and the seller (or the seller's representative), resulting in better representation than you could have achieved on your own. Here are several other benefits of using a buyer's representative when buying a business.
- Acquisition strategy. Most buyers know what kind of business they are interested in acquiring long before they kick off the buying process. What they lack, however, is a solid acquisition strategy. A good buyer's representative works with his clients to establish a sound acquisition strategy, giving buyers realistic expectations about acquisition goals, benchmarks, and timelines.
- Focused search criteria. After clarifying your acquisition strategy, your buyer's representative will narrow your search criteria and launch the search for qualified purchase prospects. The criteria that will be used to either qualify or disqualify prospects include industry specifications, earnings history, geographic limitations, and other factors that emerge directly from your acquisition strategy.
- Prospect screening. Another nice benefit of using a buyer's representative is that you don't have to personally handle screening and initial interviews with prospects. This saves time, but more importantly it allows you to remain anonymous until your representative locates a company you might really be interested in buying.
- Hassle-free buying process. Okay, maybe it won't be a completely hassle-free buying process. But there are a lot of problems that can happen in the purchase of a business. A qualified buyer's representative knows how to keep the process on track and deal with any unexpected obstacles when they arise.
- Purchasing Expertise. Finally, a successful buyer's representative has something that you don't: Experience. At the end of the day, you're a business owner – not a broker. Even though you have a general idea about best practices in a business acquisition, buyer's representatives are proven experts who are capable of providing the best possible advice at every stage of your purchase.