When buying or selling your business, the question of whether you need an adviser comes into play. SME entrepreneurs want to invest in meaningful activities and not spend money on consulting hours when they don't have to. Good news: it's well worth the investment.
An acquisition advisor is useful in all acquisitions and necessary in most. Not only in terms of time investment, but also to avoid costly mistakes.
Flying hours
Perhaps you can remember the first time you went to fix a bicycle tire. You watched the bicycle mechanic at work or you looked up a video on the Internet. And then you went to work yourself. Often it all turned out to be a bit more difficult than expected and it certainly wasn't that simple. That was because you had not yet made enough 'flying hours' in tire repair. And had not yet encountered all the problems and solutions. That is often the case with first times.
When selling their business, entrepreneurs also often think they can do just fine on their own. In practice, using an adviser is a smart move. This seems like a case of WC duck, but there are good arguments.
Good advice is a sustainable investment
An adviser prevents a lot of setbacks:
- An excessively high purchase price
- Too low a sale price
- An expensive contract that doesn't understand/use anything
- Soured relationships between buyer and seller
- An over-complex construction
- An improper match
- Unnecessarily enrich the tax authorities
- Investing lots of extra hours in addition to your normal work
The cost of these setbacks is many times greater than the investment in an adviser. The setbacks can easily run into the tons or millions. The average investment in the consulting hours of an acquisition advisor in SMEs is about €30,000 (excluding success fee). Simple math.
Types of advisers.
There is a suitable adviser for all situations. If you only need a target or buyer, there is the network advisor. If you want to be completely unburdened, there is the acquisition advisor. In between there are many variations. You can choose between niche players and more all-round firms.
A good adviser will quickly learn about your type of business and your market.
Match between entrepreneur and adviser
Choose an adviser that fits your company's situation. And especially one that suits you as a business owner. An acquisition process is not only business but also emotionally challenging and stressful. Trust between entrepreneur and adviser is therefore essential.
It is important that the adviser operates according to the entrepreneur's standards and values. The entrepreneur can then more easily leave the process to the adviser. This trust and mutual understanding helps achieve an efficient and effective process. And that is convenient for the duration of the trajectory (an average of one year).
No adviser required.
When is an adviser not necessarily necessary?
- The entrepreneur has a lot of experience with acquisitions and has enough time on his own;
- The company has an in-house team with acquisition knowledge and expertise;
- The match is made, the risks and opportunities are crystal clear, financing is not an issue, there is 100% trust, the terms are clear and acceptable, and the acquisition is not such that it could jeopardize the survival of the company.
Summary
As mentioned, an acquisition advisor is useful in all acquisitions and necessary in most acquisitions. You as a business owner know your own situation and take stock. In most cases, the investment easily outweighs the potential risks and failure costs. Choose the adviser that suits you and your situation. There are plenty of choices.
