What to Tell Customers When Selling Your Business
Selling a business can be a complicated process. But don’t forget about your customers–the people who will continue to patronize the business after you’re long gone.
A business sale is one of the most difficult transitions in the life of a company. As the seller, it is critical to help guide your customers through the transition, and to provide reasons for them to remain with the business. This is obviously true if you have a financial stake in the company after the deal closes (if you’re financing part of the sale, for instance), however, it’s also true if you don’t have any direct financial motivation. Why? Simple: it’s the right thing to do for the customers, it’s the right thing to do for the new owner, and it’s the right thing to do for your reputation.
As with your employees, professional and clear communication is the key to successfully guiding your customers through the business-ownership transition process. By carefully and strategically informing clients (especially the more valuable ones) about the sale and building their confidence in what lies ahead, you will help them make good choices, help the new owner succeed and, in so doing, continue to build your reputation.
1. Move quickly, quietly, and personally.
It’s important to be timely in your communications with clients. Otherwise, key clients could learn about the transition from media outlets, competitors or other sources–and there’s no guarantee that the information your clients receive from these sources will be accurate. This could cause your clients to make poor decisions that could reduce the selling price (if they find out before the deal closes) or hurt the ability of the new owner to succeed. Be mindful of the need to preserve confidentiality early in the process and coordinate the release of information with the new owner, but don’t wait too long. You want your customers to be well informed and to base their decisions on facts so the earlier you can communicate information to important clients, the better. If you’re unsure about timing and confidentiality issues, consult with your broker and other trusted advisers who have successfully sold businesses in your industry.
2. Notify key accounts first.
It’s important to communicate information about the transition with your most important accounts first. At this point, your relationship with these clients should be solid, so your goal is to ensure that they remain with the company after the transition to new ownership is complete. Whenever possible, provide these clients with comfort, confidence and an assurance of the financial strength of the business. Also, be sure to address how the ownership transition will continue to provide them with the same high-quality service they’ve come to expect and, potentially, even benefit them or their companies.
3. Address specifics.
As you might expect, clients will have specific concerns during an ownership transition. Is the new owner a person of high-integrity? What are his/her qualifications? How will the company’s relationship with the client change, if at all? When appropriate, discuss the transition with your customers, including the level of involvement you will have with the company going forward. Be direct and provide as many details as you can at each stage of the process. Be sure to address (in collaboration with the new owner) any concerns about outstanding pricing arrangements or warranty agreements.
4. Stay positive.
When you communicate the business sale to customers it’s important for you to remain enthusiastic, positive and confident in the new owner’s abilities. Introduce the owner in a short statement that conveys your confidence in his/her expertise and plans for the company. If necessary/helpful, you might also want to explain why you’re choosing to sell your business, what your plans will be after you leave and the role you will play during the transition. The key is to build customers’ continued confidence in the business and instill their confidence in the new owner.
During your ownership tenure, communication undoubtedly helped you maintain a positive relationship with your clients. Now that you’re selling the business, communication will affect your clients’ decision to stay with the company as well as your reputation in the industry. By communicating confidently, clearly and strategically your clients will be more likely to embrace the new owner and continue to enjoy a positive relationship with the business.
Curtis Kroeker is group general manager for BizBuySell.com and BizQuest.com, the Internet’s largest and most heavily trafficked business-for-sale marketplaces. BizBuySell.com currently has more than 910,000 monthly visits. @BizBuySell
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