Finding A Business Buyer In A Recession

By: BuyTradeBiz.com

There is no escaping the fact that the economy will always go through a recessionary and growth cycle. The only fact that changes in every cycle is the timing of when a recession starts, when the economy bottoms out and if the recovery is V shaped U shaped or a W and so on. The same is true for growth periods, and the facts that change are how long the growth continues until it slows down and falls into a recession.

Now that we have agreed that recessions are unavoidable, let us see how a business owner can handle his or her exit in a recession. I am sure some readers are thinking, why, should any owner sell a business during a recession, why not simply ride out the recession, wait for the economy to grow again and then sell the business. Good point, but experience tells me it is not always that simple. There are a lot of reasons, I can think of, but let me just cite a couple of them.

First reason, is quite common, a partnership is ending. This could be for several reasons, including health of the partner, could be a divorce or could be just a serious disagreement on strategy or direction of the business. Regardless, the business must be sold, because the partners have to. A second typical reason is owners financial situation, especially in a recession can force him to cash out so he or she can attend to personal or other business financial challenges facing them.

Alright, now we have a business for sale in our hands that we must sell a business during a raging recession that will not end. You are forced to find willing and able business buyer that not only want to buy a business, but also has the financial muscle during a recession. People are looking to conserve cash, not spend it, they would argue. . This is indeed a tough challenge, every one will concede.

But, every cloud has a silver lining, as the saying goes. Savvy investors and seasoned buyers are lurking for just such an opportunity to buy businesses. These are what I would call value buyers. They do not like paying premiums for businesses but are always looking for a value purchase. They are not reckless mavericks but very conservative investors that will buy businesses when they see the price makes the opportunity just too attractive to pass up.

As a business owner, you must do your homework to prepare the background on the business, so you can convince such a savvy buyer that what they are looking at is an impeccable business that can provide the value the buyer is looking for. Remember, these buyers know what they are looking for. They will look for a stable business, that is producing returns and typically has a strong track record and a strong management. These buyers are out there every day looking just such a business opportunity to come their way. Mr. Buffet did not hesitate to gobble up a few rightly priced businesses in not only this recession, but in every recession he has been around for.

So, the takeaway here is simple. Buyers are out there, so cast you net wide and lookout for that seasoned savvy investor or business buyer that is looking for that value purchase!

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