Mergers & Acquisitions Advisory

A Neumann & Associates, LLC

October 9, 2016

A Good Business Buyer Introduction

By Joseph Eneldas


Regardless of how successful a business is managed, business owners often express quite a bit of anxiety when meeting the first potential buyer for their business.

“There is no question, these folks are quite nervous before the first meeting, as they don’t know what to expect,” says Achim Neumann, President, A Neumann & Associates, LLC, a New Jersey based M&A advisor and business brokerage firm, “and it often takes the knowledge of an experienced advisor to get both parties comfortable”.

So what can go wrong and what should a business seller (and buyer) be watching? Unlike presidential debates, mastering the exchange of information during a buyer/seller introduction is not quite as challenging, but it does require preparation on both sides.

From a buyer’s point of view, he or she should have fully read the Confidential Memorandum and the business valuation, and the buyer should have compiled – and written down – a list of questions that were not addressed in those documents. Such questions are best posed by the buyer after a brief initial introduction outlining his/her background and experience and why this particular business is of interest for an acquisition.

Nothing is worse than a buyer exploring matters already described in detail in the prospectus, or by raising questions in a confusing manner, such as jumping around from topic to topic. No doubt, a business seller will be quite reluctant to offer a seller note to a buyer with such a disorganized investment approach, concerned that future business investments will be conducted in the same fashion and thereby jeopardizing the payback of the note.

From a seller’s perspective, the business owner would want to learn what the plans of the buyer are for the business. Even though formal control of the business is transferred to the buyer at closing, every seller wants some assurance that the business he or she has built over many years will continue to thrive.

The seller also needs to prepare for the meeting by making sure that they have a clear understanding of the key metrics of the business, including the financial, operational, and marketing aspects. Whereas no buyer expects detailed explanations during the initial meeting, the seller still should be able to answer such questions in a general context.

Two questions, however, will always surface at an introduction: first, why is the business owner really selling, and secondly, how can the buyer grow the business based on the business’s competitive advantage.

“There is not a single buyer introduction where these questions have not surfaced,” says Frank Arcoleo, Managing Director, Central Pennsylvania and Northern Maryland. ”Every buyer wants to know not only that the seller isn’t ‘dumping’ the business in advance of hard times, but instead that there are significant growth opportunities for the buyer to exploit.”

Generally, the initial meeting is off-premises and the seller is not expected to bring any business documents. If, however, the meeting is on-site, the seller needs to ensure that the facility is in tip-top shape. Nothing reflects worse on a business than a facility that looks shoddy. With a bad looking facility, a buyer will immediately assume that the “numbers” are also sloppy and that the management of the business is probably just as disorganized – whether justified or not. Worse, a shoddy appearance may lead the buyer to conclude that the owner is not really interested in selling the business!

In sum, good preparation on both sides will go a long way towards generating trust and interest, leading to further discussions and ultimately a sale. A bad first impression, though, is hard to offset later on.

About A Neumann & Associates, LLC

A Neumann & Associates, LLC is a professional mergers & acquisitions and business brokerage firm having assisted business owners and buyers in the business valuation and business transfer process through its affiliations for the past 30 years. With an A+ Better Business Bureau rating, the company has senior trusted professionals with a deep knowledge based in multiple field offices along the East Coast and has performed hundreds of business valuations in its history. The firm’s competitive transaction fees are based on successfully completing transactions. For more information, please contact A Neumann & Associates at 732-872-6777 or

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“I had been in touch with Karin and Gary from A Neumann & Associates regarding some opportunities and was looking forward to meeting with them. Hence, when they organized a seminar in Princeton, NJ, I was quick to sign up. The seminar was very informative as the team walked the attendees through various scenarios and referenced real life buying/selling situations they had been through. The sessions by Gary, Karin and Achim were crisp and focused and brought clarity to potential seller and buyers. I strongly recommend the team and look forward to continue working with them.”

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“Thank you for your Event on "How to value, Sell, and Buy A Business for Maximum Profit" and the insight into ANA’s approach on what is involved in the Business Exit for sellers. Garys Hervieiou's "Business Valuation", Achim's "Deal structure" presentation and Karin’s "Preparing the Package" are real street knowledge shared. They answered attendees questions which makes it more interesting for learning from others. Great for small businesses like us. The presentations were totally worth our time and travel for the event to Princeton, NJ from Rockville MD. Ravi Bhutani, President, CIPS”

Ravi Bhutani

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“I recently contacted A. Neumann and Associates about getting a valuation of my business done. I spoke with Marc, who explained the process in detail. After meeting with Marc in order to get a clear understanding of my business, and what I was hoping to accomplish. His patience in answering all my questions and his knowledge of the proper way to market my business gave me great confidence that this is the firm I will be using to sell my business for max value. Working with Marc at A Neumann & Associates was very easy and professional. I did not know all that was going to be involved in selling my business but they helped me through the process. What I thought was going to be a just another one of those pushy sales companies was just the opposite. Polite, knowledgeable, and a pleasure to talk to and deal with. I highly recommend this firm to anybody who wants to sell now or down the road. Marc not only knows his stuff, but actually is a real nice guy.”

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Srini Mudambi

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Colby Harris, Co-Owner, Del Mar Designs

“Claus Madsen thoroughly helped us with selling our company. From the 1st introductory meeting explaining to us what was possible, to providing us with resources to assist with the sale. Claus was invaluable throughout the whole sales process. Claus was with us every step of the journey and always made himself available for any questions or issues that came up along the way. If you are interested in selling your business, I encourage you to reach out to Claus and the ANA team so that they can let you know what’s achievable. These guys will make it happen!”

Ron Harris, Co-Owner and Vice President, Del Mar Designs
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