For a number of reasons business owners/sellers are generally more inclined than are buyers to seek third party representation. Sellers are generally more concerned than are buyers over the loss of anonymity, more concerned over the unprotected disclosure of confidential information, tend to be less experienced in the business buy/sell process, and tend to have less time to dedicate to the process than do buyers.

Anonymity: While disclosure may be required of both parties, the preponderance of such disclosure will fall to the business owner-seller, who will be concerned about protecting anonymity and confidential information from those who might be unfriendly or careless. A competent third party agent will be in position to keep those disclosures appropriately anonymous.

Disclosure: In the process, a great deal of confidential information must be disclosed. Disclosure to a buyer’s agent will often be viewed the same as disclosure to the buyer. Making those disclosures to the seller’s own agent in confidence provides the opportunity to gather and prepare the information that will be ultimately required by a buyer, and then to present it to serious and qualified buyers in ways that retains anonymity and confidentiality, and to withhold it from those who are not.

Knowledge and Experience: Selling a business is often a once-in-a-lifetime experience for an owner. The experience of an agent who knows the way and who can assist with valuation, preparation, presentation, negotiation, development of the offer, due diligence and with every aspect of the selling/buying process, through the closing, will often prove invaluable. 

Buyer vs. Seller: In our experience, business buyers are more likely than sellers to have ‘done this all before.’ Buyers are often those who have sold a business previously; maybe purchased a business previous, or at minimum, may have investigated other purchase opportunities; and in fact might be doing so right now. More frequently, small business owners will have spent their entire business lives building and running the business-now-for-sale, and no time in the buy/sell process.

Buffer of Confidentiality: This process wants the buffer afforded only by a third party. Legitimate buyers will want information on which to gauge a continuing level of interest. Cautious sellers will want to withhold information until certain the buyer is in fact a legitimate buyer; one who is sufficiently interested and capable of buying the business, and not just a curious party; not just a looker and maybe even a competitor. 

Without a buffer, business owners tend to loose anonymity the moment of contact with a potential buyer. But, loss of anonymity is quickly followed by a request for very confidential information.

Buyers contacting business sellers directly may have an idea of the information they want, and will ask for it. The owner/seller will often have nothing prepared for disclosure, will have no idea who ‘this buyer’ is and will be cautious and protective. Similarly, buyers want to withhold their qualifying information until a sufficient level of interest is apparent, and very quickly, very often, the naturally conflicted interests of buyer and seller will surface.

Bridging that gap is the function of an intermediary and we have found, generally, that a seller’s agent will be in best position to obtain the necessary information, to manage and exchange confidential information in a manner that is safe and secure to both and to buffer the exposure until legitimacy and fit can be confirmed. A seller’s agent will often also to be in contact with numerous serious pre-qualified buyers and may be in position to identify a match quickly.

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