The first meeting with a business seller can be intimidating especially if it is your first time. But since you are here on BizBuyerCentral getting your brain bigger, you will be ready for anything. I really enjoy meeting with sellers, you get to know some pretty interesting people and great stories about how they started their businesses.
Who will be at the meeting?
Well, we hope the Seller will be there since they are the main person you are there to meet. If the Seller is represented by a Business Broker, they will also be there.
It is also possible the Seller will bring an advisor, attorney, or some other person to make things more complicated. If you bring a person with you, don’t be surprised if they are asked to sign a Non-Disclosure Agreement (NDA), or in rare instances, asked to leave the meeting.
Expert Tip – If you bring a person with you to the meeting, get an NDA signed before the meeting to make everything go smoothly.
Where should I meet with the business seller?
I would always ask to meet at the Seller’s location during business hours so I can observe the operation while it is running. I want to see how many employees are there, if the phone is ringing, is anything being done, and if the place is a mess (you would be surprised…). It is not unusual or a red flag for the seller to request a meeting at the brokers’ office or some coffee shop.
A seller usually will not tell the employees the company is for sale, so they will not want to have meetings with strange people at their location. I have met at hotel lobbies, coffee shops, the seller’s house, and even a casino.
Go deeper on legal issues when buying a business
One other thing. If you are worried about understanding the legal aspects of buying a business and what you can and shouldn’t say in a seller’s meeting, this book Here’s The Deal: Everything You Wish a Lawyer Would Tell You About Buying a Small Business can help you.
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What will we talk about at a sellers meeting?
Usually, the Business Broker will do a round of introductions and invite the business Seller to provide a brief overview of the history of the business as well as how it is doing now.
Hopefully, the seller does not go on and on and cut into your time to ask questions. Once all of these pleasantries are over, you can get to the important parts. You need to really pay attention to what the seller says and how they say it. You can gain small insights by paying attention.
Expert Tip – Always take notes when you meet with anyone involved in buying a business. Sometimes when you go back and read your notes, you will see something you missed.
What questions should I ask the Seller?
The questions and answers will be the most important part of the meeting. I suggest you write out the questions in advance that way you will not get home and kick yourself in the rear for forgetting to ask something.
Now, you are wondering what types of questions should I ask?
Well, you are in luck. We have prepared a list of 80+ possible questions to ask someone selling a business. You do not want to ask all of the questions, just pick the ones that are relevant to the company you are meeting with.
If you sign up below for our newsletter, we will send you a free copy of “80+ QUESTIONS TO ASK A BUSINESS SELLER”.
How many questions can I ask the business seller?
Realistically, you will have time to ask between 20-30 questions in the normal one-hour first meeting before the seller gets annoyed. You would be surprised how tiring it is to answer questions for an hour.
You will want to ask about the operations, how the company is doing, the outlook for the future, and what type of deal structure they are looking for. People often ask why a seller is selling their business, we wrote a whole article on why it may not matter, you can read it here.
The last thing to know about the first meeting with a business seller is the issue of the price of the business. Sometimes a seller will list a selling price and sometimes they will not.
Either way, my general rule was not to bring up the business price in the first meeting. The purpose of asking all of the questions is to get a better understanding of the prospects for the business which will ultimately determine how you value the business.
Now, if you know the business and industry and you want to move fast, you can let the seller know you are interested and want to move forward with price negotiations. Price negotiations are always fun…. not really.
The bottom line on meeting with a business seller
So now you know the basics of what will happen in a meeting with the business seller, get out there and make it happen. If you prepare ahead of time with written questions, listen closely, and take notes, you should get the information you need.
Go take control of your future!
