For most of the sellers we represent, maintaining confidentiality about the sale of their business is their top priority. If vendors, customers, or employees knew the business was for sale, it could damage the business. In addition, sellers don’t want confidential information about the business falling into the hands of a competitor or potential competitor. Because of this concern, we make maintaining confidentiality our top priority.
There is more to protecting the confidentiality of your business and the sale than just saying we take it seriously. We have procedures in place that allow us to maintain confidentiality. These procedures control how we market the business, how and when we give out the identity of the business and any additional information about it, and how we work with buyers.
The first step we take in maintaining the confidentiality about the sale of your business is to prepare the blind profile about the business. The blind profile – so named because it does not identify the business – is intended to give buyers basic information about the business so they can determine if they have further interest. However, this report should not give enough information for the buyer to identify the business. The business owner reviews and approves this report before it is used in marketing the business.
If a prospective buyer is interested in more information about the company after reviewing the blind profile, the buyer is first required to sign our confidentiality agreement. In addition to agreeing to maintain confidentiality, the buyer provides us with information about his background and financial situation. This information allows us to determine how likely it is that the buyer will be able to get the financing to buy the business if they chose to do so.
It should be noted by business owners that may be thinking of selling their own business that it is very difficult to maintain confidentiality if you are dealing directly with buyers. By using an intermediary, there is a third party to maintain a barrier between the business identity and the buyer until the buyer is qualified and signs a confidentiality agreement.
Once the buyer is qualified and approved, they receive a copy of the confidential business review. This report identifies the business and gives enough information about it that a buyer can decide if they want to take the next step – a visit to the business and meeting with the owner.
While there is no way to absolutely guarantee that confidentiality will be maintained, this system works well. For the business owner, the alternative - not putting their business on the market - has a risk also -- a lower selling price or no sale at all.
BayState Business Brokers, 61 North Beacon Street, Suite 203 Boston, MA 02134
T: 617-562-5700, F: 617-562-5701