The True Life Nightmare Story
I sat in the office of a well-known industrial kitchen fabricating company. He described the slick salesmen who convinced him to fork over $30,000 to receive an opinion of the current value of his company and market it for sale. The listing was lengthy and the fabricating business owner started to feel he got snookered when months went by without the broker bringing any buyers to visit the business.
The broker finally brought someone in a few short days before the listing was to expire. When the business owner asked about the potential buyer’s background and his manufacturing experience, the buyer said that he had none, and he really didn’t understand why he was there. This is a true story, and that unpleasant experience cost the owner $30,000 without receiving any benefit. That's what I call a Mergers & Acquisitions Scam.
As scams go, he actually got off easy. We have other clients who came to us after losing over $60K with these sharks. Another client recently gave only a deposit before becoming uncomfortable and deciding to switch gears and find someone else to market his business.
I asked what made him write a check on the spot. He explained that very high-pressured salespeople ran the seminar he attended. But it wasn’t just that. They made themselves look like a big organization by having an attorney, an accountant, and an appraiser as part of the “team.”
In exchange for the deposit, the Seller was supposed to receive an appraisal of his business and patents. Weeks went by and he received nothing. Then he called the “affiliate company” that was supposed to be doing the appraisal. They would not answer his calls or his emails. The broker did, however, ask for more money. Luckily for him, the owner refused.
Is Your Intermediary In The Opinion Business, Or In The Business Of Selling Manufacturing Companies?
Do you have to spend money to get an opinion of the likely sale price of your business? If someone sells businesses for a living, should they not have the ability to tell you what they will be able to achieve for you?
I would submit for your consideration that M&A intermediaries that charge to provide an opinion of the likely selling price of your business might be in the opinion business, not the business of selling manufacturing companies.
For most business owners, the sale of their business is the single largest transaction of their lives. How can you possibly engage a broker if you don’t know what they think about the value of your company and its marketability? Doesn’t it make sense to find out before engaging their services? What if their opinion of value is so far from what you’re willing to sell the business for?
Clearly knowing that you’re on the same page is paramount.
The Manufacturing Business Owner’s Bill Of Rights
At Accelerated Manufacturing Brokers, Inc. we believe manufacturing business owners should have the benefit of certain information upfront including:
• The current value of the business and what we base that opinion on
• A recommended list price with the reasoning behind the number
• The length of time it will likely take to sell
• Buyer concerns that will likely arise and how to address them
At Accelerated Manufacturing Brokers, Inc., we view these as basic and essential to asking for any listing. They are our Manufacturing Business Owner’s Bill of Rights and they should be provided without charge. The broker charging fees upfront might be doing so because that’s all the money he or she thinks they’ll make with you. They’re in the opinion business.
We’re in the business of successfully selling manufacturing companies and we don’t need your money to get you to the finish line. We think it’s a better way of doing business. If you do too, schedule your free consultation here.