December 2024

In the business brokerage world, a successful sale depends on far more than just finding the right buyer. A key factor is working with sellers who are flexible and willing to trust their broker’s guidance. Selling a business is often a complex, emotional process, and it’s not uncommon for sellers to have difficulty compromising. As brokers, it’s our responsibility to help sellers stay focused on their end goal and encourage flexibility when necessary.

Flexibility and Compromise are Essential

A rigid seller—whether in terms of price, deal structure, or timeline—can drive away potential buyers and derail promising deals. Flexibility is key to navigating the complexities of the sale process, and sellers who are open to compromise significantly improve their chances of closing a deal. This doesn’t mean a seller must give in on every point, but it does mean being willing to make adjustments to keep the process moving forward.

However, getting sellers to listen to this advice can be challenging. Many successful business owners not only have strong emotional ties to their companies but also often have expectations that don’t align with market realities and are used to getting their way. That’s where the broker’s role as a trusted advisor comes into play. It’s crucial to help sellers understand that compromise is not a sign of weakness—it’s a strategic move that brings them closer to their goal.

Building Trust to Encourage Flexibility

For a seller to be receptive to advice, brokers must first build trust. Here are a few strategies to help brokers foster that trust and get sellers to listen:

1. Set Clear Expectations Early: From the very first conversation, set the stage by explaining the realities of the market and the potential challenges that could arise. Being upfront about the importance of flexibility helps frame the sale process realistically. This early education can pave the way for easier conversations when compromises become necessary.

2. Communicate Often and Transparently: Sellers need to feel that their broker is always in their corner. Regular updates and transparent communication about buyer feedback, market conditions, and any potential hurdles reinforce the seller’s confidence in your guidance. If sellers feel informed and supported, they are more likely to heed your advice when tough decisions arise.

3. Demonstrate Your Experience: Share stories or case studies from your experience to highlight the benefits of flexibility. Sellers often take advice more seriously when they see tangible examples of how listening to their broker can lead to successful outcomes. While avoiding direct examples in every conversation, drawing from past experiences can make the advice feel more grounded in reality.

4. Be Open-Minded and Focus on Solutions: As brokers, it’s essential to approach challenges with an open mind and focus on finding solutions rather than dwelling on problems. Sellers rely on us to guide them through the complexities of a sale, and being solution-oriented sets the tone for productive discussions. Presenting creative alternatives and practical resolutions will keep the deal moving forward, even when challenges arise.

5. Frame Compromise as a Win: Help sellers see compromise not as a loss, but as a strategic step toward reaching their ultimate goal—selling their business. Reframing the idea of “giving in” as “moving forward” helps sellers focus on the bigger picture. Sometimes it’s about finding a middle ground that works for everyone and making that clear can help them let go of rigid positions.

Final Thoughts

Helping sellers stay flexible and open to compromise is one of the most important parts of a business broker’s job. While it can be a challenge to get sellers to listen to advice, using clear communication, trust-building strategies, and framing flexibility as a strategic advantage can make all the difference. A successful sale isn’t just about finding the right buyer; it’s also about guiding sellers through the ups and downs of the process, encouraging them to adapt, and keeping their eyes on the ultimate prize: closing the deal.

There are two primary causes of a business stoppage or slow down:

Business interruption insurance deals with lost profits and “excess expenses” incurred during the period of restoration.

After a weather disruption, a common cause of lost profits is a supply chain problem, i.e. a vendor cannot provide critically needed parts or services.

It is estimated that about 35%-40% of businesses have a Business Owner Policy. Conversely, up to 65% do not have this coverage.

About 25% of businesses fail to reopen after a disaster strikes, according to the Federal Emergency Management Agency (FEMA).

I am a Certified Valuation Analyst and an IRS qualified appraiser of businesses. I have been trained and tested on how to determine the financial cost to recover from a business interruption.

A Business Owner’s Insurance policy may include general liability, commercial property/business property coverage and business interruption insurance.

Business interruption insurance covers the loss of net income due to the closure of the business or a slow down during the period of restoration. These policies may cover rent or lease payments, relocation costs, employee wages, taxes, and loan payments. These are “extra expenses” that otherwise would be incurred. The policy may cover the purchase of new equipment if repairs are lengthy and the math indicates that replacement is less expensive than repairs.

Net income is Owner’s Discretionary Earnings. This is not the same as corporate, taxable income.

Business interruption does not typically cover damages or losses from flooding, earthquakes, and mudslides, although business owners can purchase additional coverage for these specific perils. Exclusions from coverage include losses unrelated to property damage, such as lost revenues due to viral outbreaks or pandemics.

Some policies include “civil authority” provisions, which provide coverage if a government entity prohibits access to the business, forcing a temporary closure.

It is common for a policy to include a 72-hour (three day) waiting period before coverage begins.

Parties to a claim resolution may include the business owner, a Certified Valuation Analyst, a public adjustor and the insurance company and its claim processing team.

Some claims are disputed by the insurance company, which may lead to litigation.

If you have Business Owners Insurance and are experiencing a business stoppage or slow-down that will last more than three days, it is a good idea to contact your insurance agent and discuss a possible claim.

Disclaimers: I have no affiliation with any insurance company. I do not sell insurance in any form. I am not an attorney. Nothing in this material is legal advice. I have been an agent member of Business Brokers of Florida since 2003. I do not engage in the business brokerage or mergers and acquisitions businesses. My sole business is business valuation.

Embracing failure as a natural part of the journey allows you to take risks without the fear of making mistakes. Don’t have paralysis by analysis.

In a world that often celebrates ease and comfort, there is immense value in deliberately choosing to tackle hard things. The process of challenging one self, stepping out of comfort zones, and pursuing difficult goals fosters growth, resilience, and a deeper sense of accomplishment. One personal example of this is my experience with writing and staging a reading of a musical I wrote “In Between 48th Street”. It was no doubt one of the most difficult yet rewarding endeavors I had ever undertaken.

From the initial formation of the concept to writing the script, lyrics, songs (with the help of my partner Steve Sloane), recording and editing demos, to the intense rehearsals and the final stage reading, the multiyear journey of bringing “In Between 48th Street” to life was fraught with obstacles. The complexities of coordinating with actors, directors, and musicians was a huge lesson in human resource management. Despite these challenges, the process was transformative. It demanded creativity, perseverance, and a willingness to face and overcome numerous setbacks.

Over the years, I have started and purchased several businesses, each with its own set of challenges. Navigating the entrepreneurial landscape requires not only a strategic mind but also the courage to take risks and the tenacity to bounce back from failures. Additionally, serving on charitable and industry boards has presented its own unique difficulties, requiring diplomacy, leadership, and a deep commitment to making a positive impact. Writing books has been another arena where I have continually pushed myself. Crafting a book demands a significant investment of time, energy, and emotional labor. Yet, the sense of achievement that comes with holding a finished book in one’s hands is unparalleled.

For anyone looking to tackle hard projects, there are several strategies that can make the journey more manageable.

Seeking out experts and mentors can provide invaluable guidance, motivation, and insight. YouTube is also rich with educational videos and how-to guides on just about anything. Finally, enrolling in private lessons, online schools, or attending conferences (of which I did each) can of fer new perspectives and techniques that will enhance your ability to succeed. Additionally, breaking down large projects into smaller, more manageable tasks can prevent you from feeling overwhelmed. Setting realistic milestones and celebrating small victories along the way can keep you motivated and focused. We often use tools like Slack and Trello to keep track of to-do lists and task assignments.

The benefits of pursuing difficult tasks extend far beyond the satisfaction of achieving your goals. Engaging in difficult projects cultivates resilience, enhances problem-solving skills, and builds confidence. Each challenge adds to your experience and strength, which can be drawn upon in future endeavors. Moreover, the process of striving and even failing teaches you valuable lessons about perseverance, adaptability, and the importance of persistent determination. Failure, though often feared, is a crucial component of growth. Each setback provides an opportunity to learn, adjust, and improve. Embracing failure as a natural part of the journey allows you to take risks without the fear of making mistakes. Don’t have paralysis by analysis.

In conclusion, choosing to do hard things in life is a powerful way to foster personal and professional growth. Whether it’s writing a musical, starting a business, or any other challenging endeavor, the process shapes you in profound ways. By seeking expertise, embracing continuous learning, and maintaining a resilient mindset, you can navigate the difficulties and emerge stronger, wiser, and more accomplished. Ultimately, it is the pursuit of these hard things that leads to a more fulfilling and enriched life.