In any negotiation, being the person who makes the first move usually puts you at a slight disadvantage. The first-mover tips their hand and reveals just how much he/she wants the asset being negotiated. This can apply to negotiations with a buyer for your lawn or landscape business, so making your business attractive and visible to potential buyers is a good idea.
When considering the sale of your business, it is always nice to be courted, rather than being the one doing the courting. The good news is, the chances of getting an unsolicited offer from someone wanting to buy your business are actually increasing.
According to recent research from The Sellability Score, 16% of business owners surveyed in the second quarter of 2014 have received an offer in the last year, which is up 37% over the first quarter. Said another way, you’re 37% more likely to get an offer to buy your business today than you were at the beginning of the year.
Bigger companies are buying little ones for a lot of reasons and the current market conditions are accelerating their appetite: interest rates are low and stock markets are high, which provide the ideal platform for acquirers to realize a return on their investment from buying a business like yours.
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So how do you ensure you are on their shopping list? The key is to be visible to a potential buyer. That might not come naturally since many business owners try very hard to be visible to their own clients and customers but less so to others in the industry.
Here are five ways to build your visibillity and get noticed by an acquirer:
1. Win an award
Getting recognized as the “Widget Maker of the Year” by the Widget Makers Association or award from the Professional Landcare Network or your state landscape association) is a great way to get the attention of acquirers in your industry.
2. Hire a PR person
Engaging a public relations professional to tell your story to the media can get you on the radar of buyers in your industry. A lot of media relations professionals focus on the big mainstream publications, and while these are important, ensure that your PR firm also targets trade publication and industry-specific websites that are read by acquirers in your industry.
3. Host an event
Consider hosting an event (e.g., conference, tradeshow, summit) for your industry and invite representatives from potential acquirers to attend. Being invited to an industry event can be flattering for acquirers and it is a good way to get them to notice you as an industry leader.
4. Join a board
If an executive from a company you think would make a natural buyer for your business is serving on a board of directors, consider joining the board. Serving on a board together can be a great way for an acquirer to notice you and your company without you having to say you’re for sale.
5. Grab lunch
Consider inviting a senior executive from a potential acquirer to share a meal under the guise of discussing trends in your industry. At the very least, you may glean some useful information about how big companies are seeing your industry evolve. At best, your lunch mate may realize that your company could play a key role in helping them grow.
Networking with others in the industry is one of the best ways to build your visibility and get noticed. One of the best ways to network is through active participation in trade associations like the Professional Landcare Network (Planet) and your state association. Attending, and actively poarticipating in, industry events like the Green Industry Conference in October in Louisville is the perfect venue for networking.
The sale of your business is a delicate dance where it is usually better to be the courted, rather than the courter. Acquirers are on the hunt for new businesses, and having them notice you will put you in a position of strength when you get to sit down at the negotiation table.
About The Principium Group
The Principium Group provides services related to mergers & acquisitions exit planning and capital strategies to the green industry, including lawn, landscape and related businesses. Find them on the web at www.principiumgroup.com. If you are considering buying or selling a green industry business, we would be happy to discuss your situation on a confidential basis. Contact us here.
Do you know your business’s Sellability Score? Click here to answer a short survey and get your personalized sellability score and a customized feedback report from The Principium Group.