Anyone and everyone who looks to buy a business or property are wishfully dreaming of finding the perfect buy. Whether it be the dream location beside the sea or the bargain buy with BIG income at an unbelievable price, the great buys do come available from time to time.
So, why is it that many people once they have found their perfect buy, miss out on it?
Simple: over analysing!!
Once they have found what they are looking for, they simply don’t believe anything could be so good, so they set about pulling the business to pieces trying to find what could be wrong with it to be such a bargain or great deal.
We recently listed a quite new property in the Brisbane CBD and straight away we knew the person who would be interested in such a business.
It ticked all the boxes they were looking for, huge income, under 3 years old, long agreements, below market price. We got straight on the phone to let them know that we had found exactly what they were looking for and to arrange an inspection.
As expected, they looked at the building that day and loved it, exclaiming, “this is us”.
Trying to do the right thing for all concerned we suggested they put pen to paper and make an offer on the business, subject to all the usual contractual conditions such as verification of financials, legal due diligence and finance.
What’s your rush, was the comment back, “we want to check it out more thoroughly first”.
When we listed the business, as dutiful agents we read the agreements and checked the Profit & Loss to be certain all was in order as the vendor had stated to us. We relayed this to the prospective buyers but still got the “we’ll check it out ourselves first”, comeback.
Anyone could write the end of this story, newish building, large nett income, long agreements, simple business to run, YEP! The buyers inspecting the business the next morning submitted a full priced offer subject to normal contract conditions. It was exactly what they had been looking for and didn’t want to miss it.
In the meantime, I received a 2-page email from the first people with a list of 20 questions that would all normally be covered under the standard contact conditions. I let them know they had missed out on the business and now I am the worst person in the world.
Why didn’t I insist they submit an offer, why didn’t I tell them there was another interest in the business, why, why, why?
At the end of the day as agents we work for the vendor to get them the best result possible.
Buyers who insist on doing most of their due diligence prior to submitting an offer on a business will usually miss out because as vendor’s agents it is our job to get the best result for a vendor. Unfortunately for some buyers who insist on over analysing a business before they make an offer, they will probably miss out.
The secret to buying your dream business, “GET IT OFF THE MARKET”.
Make an offer full of terms and conditions but get it off the market.
Those who over analyse will likely be those who are disappointed.
Have a great month.
Regards RCA Business Brokers Team