This situation happened quite recently.

One of the INVMAG brokers was showing the restaurant to his client Pete I. (his real name was changed to preserve the client's confidentiality).

It's important to mention that restaurant owners are usually paranoid and only want to meet after hours to maintain privacy.

The investor can see how the restaurant works when it is open.

In this situation, the meeting was scheduled for 5 a.m. The buyer and broker traveled two hours to get to the meeting. The seller was twenty-five minutes late. When he opened the restaurant, he said, “sit down,” and left to turn on the pizza oven. When he returned, he stood aside and began making pizza dough. Further, he could not give adequate answers regarding the financial performance of the company. At the same time, no broker attended the meeting to work on the part of the seller.

As a result, the buyer, became embittered, left the meeting, and said that he would not return to this chaos.

What mistakes do business sellers usually make at the first meeting and why is this happening?

People who have not read our books or received training are not able to correctly prioritize. They are used to doing what they usually do.

The salesperson talks to the people who will give him money that he most likely will live on for the rest of his life. This is a much higher priority than preparing pizza. But the owner in the example showed by actions that making pizza dough was much more important.

The second mistake is the inability to come to the meeting on time. This is also an indicator of a failure to prioritize. We usually see that sellers in half of the cases are late for appointments they make. Thus, they show that they have more important things to do.

Owners also skip the business preparation phase. They are asked questions, but they are not able to answer them.

Formally, the broker of the selling side has the right not to be absent from the negotiations. The standard agreement states that the broker can only send investors. However, a buyer's broker must be present.

This, of course, is convenient for the broker, but unacceptable to the seller. After all, the broker knows a lot and can save the buyer from aggressive and manipulative tactics, and can answer questions about the process. You can learn about the most insidious negotiating style in our article. When drawing up the contract, it should be noted that the broker must be present at all meetings and resist violations of the protocol. In 85% of cases, this does not happen, but you need to be ready for this in 100% of cases. INVMAG brokers attend all meetings.

You can learn how to be successful in negotiations in the sale and purchase of a business from our classes.

How not miss out on a good investor?

5 ошибок продавца на первой встрече с покупателем 3

  • Be punctual. This will show you respect for the other side.
  • Prioritize correctly. The investor gives you money. He must understand that your negotiations are a priority for you.
  • Get ready for negotiations. Study your business information to be able to answer the questions posed. You should also understand the goals of the buyer of the business.
  • When drawing up an agreement with a broker, write down the clause that he must be present at negotiations with the investor. This way you will feel more confident, and the negotiations will be more successful. Learn more about the role of a broker in selling a business here.

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