Apex Success Stories #5: Persevere!
We always try to stress to buyers and sellers not to take things personally, despite a business transaction’s tendency to be one of the more emotional things people can engage in during their lives. But sometimes, there’s a variable that makes existing challenges that much harder.
This particular story starts with a business that often has a more specialized buyer pool: an auto service shop. The seller wanted to retire and had some health issues. The buyer was an experienced mechanic who had always wanted his own shop. The match looked good on paper, so it was time to start the work on the deal.
Banking Challenges
The buyers initially got approval for a loan, but a couple of months later, the bank reversed course and said that they would not back the loan. The buyer didn’t really want to disclose why the bank had done so, and the seller ended up calling the bank and getting their side of the story. Whatever the reasons for the bank’s hesitance, a seed of doubt was now planted — not so much with the seller himself, but with his wife, who now felt that the buyers were “not the right buyers.”
The buyers, for their part, had stayed the course. They had always liked this opportunity, and they knew they were not part of a frenzied group of bidders for the business. They were the right fit, even if the seller’s wife didn’t think so. They found another bank that was happy to back them.
Environmental Challenges
As with businesses of these kinds, some environmental inspections may be required, either for banking or municipal reasons. The company the bank hired to do the environmental studies initially messed up and had to redo its work. This roadblock was another aspect of the narrative that the seller’s wife was nurturing: this deal isn’t going to happen…these people are bad, this thing is cursed, etc.
Attitude Challenges
As might be inferred from what we’ve talked about already, it wasn’t enough to have these challenges, challenges which are completely normal in any given business transaction, but we had to have, in a way, a party close to the seller, who was creating a hostile environment.
The buyers didn’t get pulled into this. They stayed positive and just kept putting one foot in front of the other. For example, when the sellers requested that inspectors come on the weekends, outside of business hours, to preserve employee confidentiality, the buyers gently coaxed and encouraged these inspectors to accommodate these demands.
Key takeaways:
- Banking relationships matter. But not all banks will agree on the funding of a deal. Just because one bank says no doesn’t mean another won’t say yes. The buyers didn’t lose heart. They kept going and got a Yes where they had originally gotten a No.
- People will mess up. We are humans and those environmental inspectors did not have a plan to try to sabotage or delay a deal. They made a mistake. Instead of getting frustrated when obstacles happen in a deal, take a breath. Or three.
- Tune out the noise. Ultimately the seller was able to tune out the negativity from his spouse and accept the good faith and hard work being shown by the buyers. He knew that there were not a lot of people banging down the door to buy his business and stayed the course with the only people in the room. That allowed this deal to get to the conclusion that we hoped for and got: a win/win/win.
Do you want to be our next success story? We’d love to help you with buying or selling a business. Give us a call.
