Business buyers are a timid lot, even more so now that they are facing an uncertain economic landscape.
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If your exit strategy involves selling an educational cooperative now, sellers need to make a strong case for buyers to purchase at or near the asking price.
Identifying Serious Buyers
If you haven't sold a business before, prepare to be overwhelmed by tire kickers -- seemingly interested buyers who lack the capacity, ability or desire to actually purchase your educational cooperative. As a seller, it's important to separate the tire kickers from the serious buyers as soon as possible. Each tire kicker is an investment of time and energy that could be poured into finding a more qualified prospect. Your business broker can offer insights about how to quickly spot tire kickers. As a rule, they limit the amount of information that is provided in the initial stages of an engagement, waiting to reveal the juiciest details of the business until the prospect has been thoroughly vetted. Smart sellers may require prospects to provide background and financial information fairly early in the process as a way of verifying the financial capacity to close the deal.
In an educational cooperative sale, the Letter of Intent contains the vital elements of the deal between the buyer and the seller . If you are seeking buyer concessions, the time to address them is before the Letter of Intent is drafted. For sellers, that makes a close review of the Letter of Intent more than a formality - it's a critical juncture on the path to closing.
There is a lot of work that needs to be done before you're ready to sell your educational cooperative. Perhaps the most important pre-sale consideration is to right-size your expectations to the realities of the market. Once your expectations are in the ballpark, you can move on to making your business presentable to prospective buyers.
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