What To Do About an Unresponsive Biz Broker…
Dec 07, 2023Hey Biz-Buyers,
Welcome to this week’s Boring Business Brief, where we share some of the best insights, tips, and stories from our private biz-buying community.
Today we’re sharing tips for dealing with unresponsive brokers, diving into one member’s deal box struggles, and highlighting links, resources, and memes being shared around the community.
But first…
Check out this touching Thanksgiving note from one of our members:
We like to say that one of our groups of target readers for this newsletter are people who think the newsletter fails to live up to its name — people who get excited by “boring” businesses, the folks building and buying them, and the challenges they face. For all those out there who fit this bill, thank you.
Now, let’s get to this week’s good stuff.
Today, in 5 minutes or less:
What to do about an unresponsive broker…
Dates… Job applications… Small business brokers… Whatever the case, being ghosted ain’t no fun. Ever.
Turns out, one of our members is dealing with a good ol’ case of unresponsive brokeritis right now, and they’re looking for a cure:
The good news? This has gotta be one of the most relatable issues our members face. Weeks to get replies to emails? Been there. A month to hear back on a phone call? Done that.
In other words, our members had a lot of advice to offer here, so let’s walk through some of it:
Member 1:
“Typically there is verbiage in the NDA about contacting the seller on your own. Seems like you have to go through them first if you’ve signed the paperwork. Hit them through all the mediums consistently — call, text, email…”
Member 2:
“What type of messages are you sending? It could be a good time to take a step back and hone in on your target statement/elevator pitch. You should get specific on the type of business you’re looking for, how active you are in business buying, and why they should work with you. I think brokers get hit up all the time and the goal is to set yourself apart.”
Member 3:
“+1 for the personalized / listing-specific initial outreach. Most of the brokers responded quickly and said they were surprised that I did it when we were in that phase. Also of note, if you are reaching out to a lot of businesses, keep track of who the brokers are for each deal so you can tailor the subsequent inquiries and follow-ups accordingly… If you haven’t heard back on an initial inquiry and the listing is still up it could have an LOI, the broker could have missed it, or a million other reasons, but the listing is still active so keep doing what you’re doing, and follow up on some regular interval. Good luck!”
Member 4:
“Some may not get back to you. Maybe add some humor. Try to get a chuckle or a grin. And when all else fails you can try the ‘Have you given up on getting a deal finalized with me?’”
Member 5:
“Have you given up on getting a deal finalized with me?” is straight out of the ‘Don’t Split the Difference’ book. Great book about negotiation, where asking a ‘No’ question causes the person to lean in and engage with you. Disagreements get real traction in negotiation.”
Buyer advice: What to do if you’re struggling to define a deal box
One reason biz-buying is really hard?
There are just so many industries to consider. There are industries where you have direct experience. Industries you’re curious about. Industries that are actually available and accessible to you.
Determining how to draw the Venn diagram that aligns these factors and outlines your deal box is no easy task, and one of our members struggled with this recently.
“I need to ask for help/advice,” they wrote.
Here was their situation:
- On one hand, they were very interested in buying car washes, laundromats, or other businesses (which they have no experience in but were confident they could figure out).
- On the other hand, they listed out their actual experience, which includes construction/roofing, IT/computer, and network engineering.
Obviously, these are all seemingly very different things.
“Does anyone else have this problem and if so, how did you overcome it to gain clarity and focus on your 1 or 2 industries?” they asked.
Here’s what members had to recommend…
Bring the tech background to an old business.
“You went to the technology field, which can help you a lot when it comes down to optimizing a boring business. You have a unique advantage in the roofing business. Go all in finding a roofing business that needs help and that’s operating like it’s the 1950s. Don’t sell yourself short. You have skillets that you can leverage.”
Learn as much as you can.
“The answer is: learn. How?
1. Go through business listings. Read everything you can that is shared from those listings. Get the info from a few that look appealing (NDA, get the CIM, data room info, etc. to get more info on that business).
2. Once you find a few types of businesses that are interesting — the fun part — go down the rabbit hole on that business type… Use your strengths first (technology). Discover what technology solutions they need to run their business.
3. Start narrowing down your deal box to just not revenue/SDE size, but also what industry you want to focus on, potentially what niche within that industry you want to focus on, what services they provide, their margins, etc…
4. Once you’ve built a sufficient knowledge base, your interviews with brokers/sellers will become much easier.”
Try on the shoe to see how it fits
“Much of my “deal clarity” was carved out once I started signing NDAs and taking a closer look at businesses; defining my perfect deal box was too abstract otherwise. From that, I could start collecting data… Personally, I wasn’t able to get clarity until I got closer to those businesses and started having to imagine myself in the different scenarios that might come up in ownership.”
Practice radical self-awareness
“This podcast really helped me realize how easy it is to waste time looking at businesses that don’t fit your deal box. I recommend you listen to it because it provides a great framework for your search.”
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