The Most Important Things to Know About Buyer Concerns When Selling Your BusinessPublished July 22, 2020 | By Achim Neumann, PresidentWhen selling a business, the better your understanding of a buyers’ approach to the market, the better able you will be to maximize the ultimate sale price of your company when you decide to exit. This rule is especially true in the current economic climate.Before buying a company during a period of economic uncertainty, there are a number of factors for deal makers to consider. The reality is that most business owners cannot negotiate from a position of strength unless they have a thorough understanding of the key issues impacting deals today from the perspective of the buyer.To adequately address buyer concerns during the negotiation phase, the following three factors – among many factors – are important to consider at the moment.InnovationAlways remember that buyers are interested in buying a company that will be successful in the future, not one that has simply been successful in the past. While this has always been true, it is especially pertinent when you are negotiating with buyers today. If you have innovated or come up with strategies that have helped you survive during challenging times in the past, you should use this to your advantage. If you have adapted to the new normal of the pandemic we are currently in and have thrived, you should not be shy in making buyers aware of what you have achieved and how it will set the company up for future uncertainties until things go back to normal, if and when they do.Do not simply assume buyers will understand the work that you have provided merely by reading the marketing documentation you present. Show that you are proud of what you have done and how the changes you have made have created a business that is resilientDisaster Planning and Business ContinuityIf this pandemic has taught us anything, it’s that even the smallest business operations need to engage in disaster planning within its operations to ensure business continuity. The economic outlook for the near future is looking uncertain, and this pandemic certainly is not the last major disruption a business will face –the specter of climate change is set to increase the incidence of wildfires, floods, hurricanes, and dozens of other potential interruptions to business that will have to be navigated somehow.This pandemic has brought into sharp relief the importance of having good back-up plans, remote work sites, and other documented ways of doing business when disaster strikes. Having worked your way through this one, make sure you document how you did it and how you intend to prepare for the next one.Supply Chain DiversificationThe third factor that you should be aware of is supply chain diversification. The importance of supply chain diversification cannot be overstated. As the Japanese Tsunami in March of 2011 and the trade wars over the past year have clearly demonstrated, having multiple supply chains in varied locations is a crucial component of a resilient business.During the sale process, buyers will examine your business and assess the strength of your supply chain. If your business depends heavily on a small number of large suppliers, it is wise to consider diversifying your supply chain. A diverse supply chain will be attractive to buyers because it shows that a business is well-positioned to weather future disasters.Buyers will always look for ways to reduce the risk of acquiring a business. They will turn over every stone to ensure that a new company has everything in place to allow it to flourish once they have taken control at boardroom level. This is when due diligence becomes paramount.In times of economic uncertainty, the risks involved with business acquisition are significantly heightened. In the current climate, it is now more critical than ever to seek professional M&A advice long before you begin negotiating with buyers. We have yet to meet a business owner who was upset at creating an M&A strategy too soon.If you are interested in obtaining the maximum value for your business at this challenging time, it is a wise choice to contact A. Neumann & Associates, LLC to arrange a meeting with an exit planning professional as soon as possible.