The actions here may seem obvious to you. A straightforward task on the face of it.
This may indeed be so.
However on the basis that, "You only get one chance to make a first impression”, it makes good sense to take a moment to reflect on how you’ll approach communication with prospective buyers.
This in turn raises an important question, namely, "What represents a good buyer prospect?” for your particular business.
If you’re very lucky you’ll be inundated with enquiries from serious buyer prospects, which means that you’ll be spoilt for choice and are more likely to achieve your asking price.
However in a "buyer’s market” the reality may be the exact opposite. Which means that you’ll need to play close attention to the quality and effectiveness of your communication, if you’re to achieve a sale at close to your asking price.
This how-to article helps you to answer the following questions.
- How to filter "prospects” from "suspects”?
- What is effective communication?
- Which information to provide, and when?
Let’s look at these in more detail.
1. How to filter "prospects” from "suspects”?
What you really want are qualified "prospects”, as opposed to mere "suspects”. With suspects you’ve insufficient information or evidence with which to draw any meaningful conclusion about their desire, or means, to buy your business.
The real problem with suspects is that they waste your time and deflect your attention from serious potential buyers. Worst case, you go a long way down the sale process only to find a significant barrier to the sale that could’ve been identified early on. By this point you may have already turned down better prospects.
So your first task is to filter out time wasters, as quickly as possible. A good start point is to set clear conditions in your online advertisement. You can look at this from two angles, namely, "what you do want”, or "what you don’t want” (or if you like, a combination of the two).
You may decide to specify a typical buyer profile that would be acceptable to you. It’s recommended that you refer to this buyer profile checklist at all times during the buyer qualification process.
This could include previous experience of running a business such as yours, specifying key skills, availability of ready cash, or proof of access to sufficient funding. You may ask to see their resume. Perhaps you prefer to sell to a local who understands the area and the clientele.
This may result in fewer enquiries but it has the advantage that the ones you get are of better quality. More likely to buy your business. It’s also unlikely to upset anyone because it saves their time too. Make sure to follow through your specified information requests before engaging in detailed discussions.
As you enter a dialogue or email exchange with a prospect you’ll start to learn more about them. An impression about them will start to form. If they don’t respond to emails, and you know they received the communication, it probably means they’re not interested and you can focus your attention on more likely prospects.
In summary, the key point of this section is managing your time effectively. To distinguish early on between a "suspect” and a "prospect” and then further qualifying prospects as you move through the communication process.
2. What is effective communication?
Communication is only effective when it leads to mutual understanding by both parties. This implies the need to periodically check the other person's understanding of the message before moving on to the next stage.
With your business sale campaign up and running you’re probably receiving responses by email or telephone (according to the desired method you specified). In communication terms you’ve first created awareness of your business and now, crucially, interest has been expressed. We assume from section one above that you’ve sifted prospects from suspects.
The challenge now is to move your business into the buyer’s short list where they’ll take a more serious interest. The buyer's criteria for short list selection, and the number of businesses on it will depend on the individual buyer. It's likely that they'll have a choice. As you go through the information exchange process it’s a good idea to ask them about other businesses they’re considering because this may help you to establish whether they’re a real prospect, or not.
If the buyer has options, and a real choice, then you’ll definitely need to "put yourself in their shoes”. So what will the prospective buyer require from you in terms of response and presentation?
You can think of your own points, but here are a few to get you started:
- Prompt response
- Specific information requests (the detail)
- Business-like approach
- Clear, relevant, unambiguous, accurate communication
- No grammatical or spelling mistakes
It’s important to respond promptly to enquiries. This will demonstrate to prospects that you’re on the ball and value the interest they’ve shown in your business.
Buyers will often request more information than you’re prepared to give at this stage. Answer their questions where you can without compromising your position. Be prepared to say when you’re not willing or able to answer. It helps, even before you receive your first enquiry, to anticipate what questions you may be asked. This will help to speed up your response.
As a lot of money is at stake it pays to be business-like at all times when dealing with buyer prospects.
How do you feel when you receive a poorly written message? If you’re not impressed what is your reaction? You’re probably not going to offer the person a second chance. This is particularly significant early in a business relationship.
Some people are particularly intolerant of sloppy email communications. For example, unclear, badly structured sentences, grammatical errors or spelling mistakes. Is it worth turning off a significant proportion of potential buyers for the sake of a little care and attention? This applies also later if you send text messages.
Take care with telephone calls too. Have a purpose for these conversations and agree an agenda in advance to provide structure. This reinforces an impression of your professionalism. A good tip is to stand up when having these important conversations as it helps you to better focus attention.
Prepare a few supporting notes next to each agenda item to prompt you. If you’re asked a question where you don’t have the answer, say you don’t know. Offer to find out and get back to them. This is far better than making something up on the spot, or giving an unconvincing answer.
To summarize this section. Other things being equal, if you pay attention to basic details in your communications, and the competition doesn’t, you’re going to have a better chance of being shortlisted by prospective buyers.
3. Which information to provide, and when?
There’s a danger that communication with possible buyers can turn into something of a "dance”, with major misunderstandings that lead to an eventual dead end.
Part of the problem is them wanting more information from you than you’re prepared to offer at this time. This is typically more of an issue in the early stages of a relationship, when you’re sounding each other out.
This is why it’s important to be frank and open from the start about what you’re prepared to divulge, when, and under what conditions.
This is easily dealt with by stating your conditions for information disclosure in any "call to action” statement within your online advertisements.
Prospective buyers will want early access to the detail in your Sale Memorandum (refer to the How-to Guide). You decide when it’s appropriate to offer this crucial document. For confidentiality reasons it’s really important to get them to first sign and return a Non Disclosure Agreement before sending them a numbered copy of the Sale Memorandum. Standing firm on this issue has the benefit of showing you mean business. It also tests the seriousness of a buyer enquiry.
It’s particularly important when you’ve reached the information exchange stage that you seek confirmation that the information has been actually received. How often have you sent an email, a text by cell phone, or left a voice message to find that it was never received?
Both sides then assume the worst scenario, particularly where it's a new relationship, when in reality it's just a technology glitch. If you’re not sure, check with them. Look in your "spam” filter or see if you've deleted the email by mistake. Send a, "Just checking...”, follow-up email.
In general, checking for understanding is a crucial part of the communication process. It’s good practice to send a follow-up email summarizing the main points and agreed actions of a conversation with a prospective buyer. Don’t wait for them to do it. Try and make it the same day so it’s still fresh in their mind. Ask them to confirm that it matches their understanding, and if you’ve missed anything.
This also provides an audit trail tracking negotiations. So keep communications factual, making it clear where you’re stating an unsubstantiated personal opinion.
To summarize, don’t be afraid to make conditions before providing sensitive information, but be up-front about it. Confirmation in writing is a good way of checking for mutual understanding.
Following an initial exchange of correspondence and telephone calls you’ll hopefully be in the position to draw up a shortlist of qualified buyers. This is the subject of the next How-to Guide.