If negotiations are coming to an end and you find yourself close to sealing the deal, the last thing you want is to encounter an unexpected stumbling block that could end up significantly delaying your new business acquisition.
Many investors find that the final leg of the journey towards acquiring a business can often be the most stressful, so here are some tips on how to close the deal and proceed as planned with your purchase.
- Stick to your guns
One of the most frustrating things that can happen when you’ve identified an acquisition target is another potential buyer showing an interest and threatening to scupper your plans.
Not only can this considerably hold up the purchase process, it can also cause the price you had previously agreed to rise significantly if the other party’s valuation is higher than your own.
If this is the case, do not be tempted to increase your offer without doing further research this could easily lead you to pay more for a business than you originally predicted which would then impact on your business plan.
- Create a sense of urgency
If you feel like the current business owner is dragging their feet and failing to treat your interest in acquiring their company as a priority, you’ll need to create a sense of urgency to move things forward.
Leaving an acquisition in the hands of someone that seems to be dragging out the process makes you wonder what other areas of the business aren’t receiving the attention they require. Place a firm deadline for the completion of the acquisition or progression of negotiations to avoid extensive delays.
- Have your paperwork in order
If you have all of the legal bases covered and the paperwork in order and ready to go, then you’ll be in a far stronger position to help the process run smoothly.
Being unprepared can make sellers nervous. Go in prepared and organisation to give the impression that you are serious about acquiring the business.
- Have a post-acquisition plan in place
When you finally sign on that dotted line and the business becomes yours, you’ll need to have a solid post-acquisition plan in place to help the transition go like clockwork and to ensure that you start off the new ownership on the right foot.
From communicating with newly acquired staff to making changes to the structure of the company or simply just having timescales in mind to understand the internal functions of your new business, you’ll need some firm first steps in place prior to closing the deal so you know exactly what to focus on once the business passes into your ownership.