December 6, 2023


Business Strategy For Economic Revival

5 Ways to Negotiate Business Price When Selling a Company

5 Ways to Negotiate Business Price When Selling a Company

You did the hard part. You started with an idea. Then, you grew your business and built up your customer pipeline. 

Now you want to sell, and you want to negotiate the best business price possible. Selling your company is emotional. It represents years of hard work, but buyers will make low purchase offers.

They want to save money on the business sale, and you want to make as much as possible. Negotiations will help you land the best business price. These business negotiation tips will help.

1. Go into Negotiations with an Exit Price

Review your company’s financials and conduct research to identify an exit price. Establishing an exit price before negotiations gives you a target. 

An exit price prevents business owners from becoming greedy. Greed on either side of the negotiation can stall the process and lead to an unfair purchase offer.

2. Consider Your Assets

A business price does not exclusively reflect a company’s revenue and earnings potential. Selling a business may also include equipment, inventory, patents, reputation, and other assets. Whether tangible or intangible, each resource adds value to your business.

Some buyers will argue about the validity and worth of your assets. However, mentioning them in the conversation will command a higher company price.

3. Give the Buyer Small Wins

Win-lose negotiations often fall flat. One party feels conned and will not attempt to conduct business with the other party.

Everyone knows what it feels like to win. Share that feeling with the buyer, so they make concessions for you. 

Before entering a negotiation, understand where you can be flexible. In a similar way, understand where you are non-negotiable. Giving way to flexible items helps you keep control over non-negotiable elements.

For instance, a seller may want you to avoid competing with them for two years. Perhaps you initially said one year. Some sellers can cooperate with this term to preserve other items.

The best negotiations leave every party feeling like a winner.