Become a Finance Ace Business Strategies and Financial Tips for Everyone

Strategic credit options should be your asset

Here your buyers could be competitors from your industry sector, larger institutions, or VCs. These buyers could be looking at your business not as a stand-alone entity, but one that has attractive synergies with (or addons to) their existing business. These synergies or add-ons could come from such things as gaining access to your customers, contracts or geographic market; adding your products to their own; taking over your management and staff (see below); or merging your overheads with theirs.

Where your target buyer is a larger institution, you could have a dilemma with regard to what you should do about senior management. In some cases,  the institution will wish to acquire sales turnover only and will strip away most of the overhead of the target business, including most of the staff. In this case, having senior management in your business will be an impediment to sale, because the purchasers will not wish to take them over and incur the cost of redundancies. On the other hand, some institutions might wish to keep your business as a stand-alone entity, thus relying on its senior management to keep it operating efficiently. In this case, not having senior management could be an impediment to sale!