The one question you should never ask the seller of a business.

February 9, 2023

Angry people in a meeting

Over my sixteen years in the Business Brokerage Industry I have sat in on many buyer/seller meetings. The initial meeting between parties is often what determines if a deal will happen or not. I watch carefully to see the chemistry between buyer and seller. If both parties are comfortable and at ease with each other there is a good chance a deal can be agreed.

I encourage buyers to ask a lot of questions at this meeting in order to address their initial concerns.

Typical questions are.

  • Will you help me after the sale?
  • Do you think your employees will stay?
  • How much work do you have in the pipeline?
  • What can be done to grow the business?

There are many legitimate questions that can be asked but there is one question that I suggest buyers avoid.

Never ask a seller to justify the price.

When a buyer asks a seller to justify their price what the seller hears is “Your business is priced too high, and I am going to low ball you” This will turn a pleasant meeting sour very quickly.

This question is more appropriately directed to the Business Broker when the seller is not present. We will be happy to address this question. Recently a prospective buyer ignored my advice and asked the question anyway. The seller was clearly uncomfortable, but he persisted and the meeting went downhill quickly. A conversation that had been promising ended abruptly. Afterwards the seller told me that the prospect was “rude” and she would “not sell him the business at any price”.

Remember that sellers are often proud of what they have built. Their business is their child. They often have a strong emotional attachment as it is something they created, nurtured and grew. They care deeply about their employees, customers and reputation. If you want to acquire their business, it’s wise to be careful how you speak of it.

About the Author

Anthony John Rigney is the owner and Broker at Quorum Business Advisors, LLC. A full-service Business Brokerage doing business in Florida and select States. For more information on our services, please contact us here