Bring the right buyer to us

Who Is the Right Buyer for Your Business?

Bring the right buyer to us

Depending on the company’s profile, trading outlook, management structure and growth potential, shareholders who are considering their exit strategy may have more than one type of buyer for consideration to approach, in order to ensure they maximize the value they receive.


A sale to an already competing trade party is the most obvious, and typically could also generate the greatest financial return, but it also carries the highest risk of a confidentiality breach.

Competitor businesses who already operate in similar lines and markets can be incentivized to acquire by enhancing their existing business model, crystallizing synergy savings, improving buying power and enhancing market share—all of which will result in an improved financial return to their shareholders.

This type of buyer is often also classified as defensive, as part of the negotiation process with them is to raise awareness of the potential risk to their future trading outlook and market share should your business be acquired by a new entrant or other market player who has access to far greater resources than you currently possess.

This ‘threat’ alone can ensure that a competitor is motivated to acquire and pay a premium price, but managing this type of buyer during a process is an art—bring them in too early, and the risk that they will either ‘data mine’ or leak information to staff/suppliers/customers of your intention to sell can severely damage value.


The next type of buyer, at a much lower risk profile, is a trade party that operates in a different market, albeit one with synergies or obvious complements to that within which you operate.

This type of buyer, referred to as a synergistic buyer, may not be obviously aware of the synergies between your businesses (which can often be servicing the same customer base with different products or services), and therefore the tactic is to make them aware of the trading benefits of merging, highlighting both enhanced wallet share of existing customers (and therefore reinforcing the reliance and reducing risk of client attrition) as well as new customers which would be opened to both companies through the prospective merger. As it is often the case that this type of buyer will not have identified your company or market as an acquisition target within its existing strategic plan, it can take significantly longer to convince their board of the full value of the opportunity and subsequently conclude a deal, and also to ensure that their valuation of your business matches shareholder expectations. However, this is a crucial negotiation at the relevant stage.

International Entity

The third type of trade buyer is an international entity.

This type of buyer will be operating within exactly the same markets as your company, providing similar products and services in other countries, but will not currently have established a significant trading presence on the ground in your area.

The challenge with this type of buyer is to evidence that they need to pay a premium and acquire your company to unlock your customer base, as opposed to growing organically and establishing a new operation, or servicing from afar.

Again, typically discussions with this type of buyer can take some time to mature, and it can often be in the interests of vendors to begin dialogue with potential international parties years before a mandated process in order to raise awareness and open the possibility of a preemptive off-market approach.

Financial or Private Equity

The other type of buyer is a financial buyer, or private equity firms.

The primary focus of private equity is to invest in companies who have the potential for significant short- to medium-term growth, both in terms of revenue and profits, and to then sell them in the future, typically 3-5 years post investment.

Private equity firms can either invest development capital in companies to help unlock growth, or convert the company into an acquisition platform to consolidate a fragmented market on a buy and build strategy.

Private equity firms typically value lower (due to not being able to benefit from synergies or cost savings) when compared to trade, but they can allow shareholder and management equity to be rolled over, offering the potential of a much higher, long-term gain based upon the future sale.

As a comparison, trade buyers will typically acquire 100% of the issued share capital of the company for cash.

Private equity firms are able to offer structures with more flexibility to meet the differing needs of shareholders—cashing out shareholders who may wish to retire or exit, whilst allowing others who are keen to stay to partially cash out and leave some of their equity in the business.

Deciding whether private equity firms are the right buyer can be dependent on timing—if a company is on a growth curve, but is still too early to maximize full value from a trade sale, then private equity can help accelerate this growth in the short-term, before exiting at full value to trade much quicker than could be achieved by the shareholders and management alone. However, private equity is a further roll of the dice by the shareholders who decide to retain equity—there are no guarantees that the forecasted growth and potential upside will happen and the changes in culture, governance and structure post-investment can be difficult for some management teams to adjust to.

So, Who Will Be the Right Buyer for Your Business?

Ultimately, you will not know for certain until a mandate commences. In my experience of over 100 company sales, I have seen the full spectrum of possibilities unfold—from clients who start out entirely convinced of who will buy them, only to be later shocked at the lack of interest; to clients who have dismissed contacting a certain potential buyer hand, only to end up concluding a deal with the very same party after that buyer submitted an offer way above market value. However, price is not the only criteria, and I recall a number of clients who have agreed to deals to sell to parties who did not offer the highest price, choosing to do so because they believed that the buyer was genuinely the right party for their business. Ultimately you will only get to sell your business once, so you owe it to yourself to ensure it is to the right buyer.

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Seeking Help from eBay and PayPal: Online Dispute Resolution

Bring the right buyer to us

A: Absolutely, positively not. Both eBay and PayPal take the position that they are “platforms”—playing fields, if you —on which sellers and buyers interact directly.

If you get into a difficult situation with a buyer, both eBay and PayPal expect that you and your buyer will resolve it directly, without their involvement.

If you can't, well, that's why the legal system exists, isn't it?

Having said that, eBay and PayPal offer a number of resources to sellers and buyers who get into difficult situations, as follows:

• eBay dispute resolution. If a transaction did not involve PayPal (i.e., the buyer paid by check or money order), either party can submit their dispute to eBay for mediation (for full details, see pages. help/tp/problems-dispute-resolution.html); eBay will ask questions of both parties in an attempt to broker a negotiated settlement of the dispute, but it will not decide who is right and who is wrong.

• PayPal's Resolution Center. If the buyer paid via PayPal, either party can submit the dispute to mediation (for full details, go to the PayPal home page, click on Security Center, then click on Resolution Center).

PayPal will ask questions of both parties in an attempt to broker a negotiated settlement of the dispute.

However, it will not decide who is right and who is wrong unless either party accelerates their claim, in which case PayPal employees will review both parties' claims and render a decision, the vast majority of which will be in the buyer's favor.

• If the seller or buyer in a dispute posts negative feedback on eBay and the other party feels it's uncalled for, he or she can file a claim with SquareTrade for a $29.95 fee ($100 for disputes on eBay Motors).

If the party that posted the negative feedback fails to respond to the claim within fourteen days, SquareTrade will recommend that eBay remove the negative feedback (and eBay usually—but not always—goes along with SquareTrade's recommendation).

However, if the other party does respond to the claim, SquareTrade will ask questions of both parties in an attempt to broker a negotiated settlement of the dispute, but it will not decide who is right and who is wrong.

So where is the “Judge Judy” who will hear both sides of the dispute and enter a binding ruling in favor of one party or the other? Answer: The small claims court in the state and county where the buyer resides is the only place that will render judgment in online seller-buyer disputes. Neither eBay, PayPal (unless prompted to do so), nor SquareTrade will render judgment. For details on how to bring an action in the small claims court where your difficult buyer resides and does business, see Chapter 6 of my book The eBay Seller's Tax and Legal Answer Book.

Q: “I'm in a dispute with a buyer right now; both of us want to do the right thing, but neither of us knows how to get this resolved and behind us. Do you have any suggestions?”

A: Always remember that any dispute with a buyer on eBay is a negotiation—each side gives a little in order to get something in return—and that sooner or later a result must be reached.

Instead of writing pages and pages of e-mails justifying your position and explaining why the other side should back down, make them a counteroffer and solicit a reply, along the following lines: “Since it's obvious you don't want this item, please return the item to me by UPS Ground and give me a tracking number. If the item is in the same condition it was in when I shipped it, I will refund 50 percent of your bid amount plus your return shipping. If that doesn't work for you, please tell me what will, as I'm happy to discuss any reasonable solution to this problem.”

The buyer will almost certainly counter with a proposal of his or her own, but usually what happens is that the ground separating you gets smaller and smaller, such that at some point your difference is so small you can simply split it equally between you and move on.

For an example of how to negotiate a dispute with an eBay buyer, see pages 146-147 of my book The eBay Seller's Tax and Legal Answer Book.

Q: “I've been in a dispute with a buyer for several months now. I have used both eBay's and PayPal's online mediation services, and we still can't get to a resolution. Where can I go from here to get justice?”

A: If you've tried negotiating with the buyer directly via e-mail or telephone (always the way to start when resolving disputes), and you can't get satisfaction from the online mediation services offered by eBay and PayPal, you have only three options:

1 . Consider bringing a small claims court action against the buyer in the state where the buyer lives. (For advice on how to do this, see Chapter 6 of my book The eBay Seller's Tax and Legal Answer Book.

) Showing the buyer you're willing to spend the time and money to pursue him where he lives may just get his attention enough that he'll start working with you in good faith to resolve the dispute.

2. Relist the item on eBay, or offer the underbidders in the original listing a second chance offer, so you can recoup at least some of your losses.

3. Give up and take one for the team. Disputes with buyers take up a lot of time and emotional energy that are better spent putting new items up for sale on eBay. Sometimes it's best to write off a bad deal, chalk it up to experience, and ( Scarlett O'Hara in Gone With the Wind) realize that tomorrow's another day.

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Bringing The Buyer To Life

Bring the right buyer to us

Many companies struggle with developing a sales and marketing strategy which satisfies the Four W’s:

  • Who? Targets the right groups of customers/prospects
  • What? Uses the right messaging – a proposition which is relevant to the target, as well as being unique and defensible
  • Where? Reaches them through the right sources and channels, in the right formats
  • When? Reaches them at the right time, at the right point in their buying journey

To avoid wasting large amounts of resource and budget, we should focus our sales and marketing planning on somebody, rather than just anybody. The “somebody” referred to here, really is somebody – a person or a character which strongly represents our target audience or segment.

We call these characters personae and we need to build a picture of them before we start marketing and speaking to them. A buyer persona is a character with a personality and key characteristics, helping us to understand who we are talking to, designing a product for and doing business with.

The word persona itself derives from Latin, in which it originally referred to a theatrical mask. In essence, a persona is “the aspect of someone’s character that is presented to or perceived by others.” 1

This definition can arguably be applied comfortably to the use of personae in sales and marketing circles in 21st Century business. Perhaps a more adequate description is the one offered by

“A descriptive summary of a group of customers/target customers, embodied within a single character.” 2

Creating personae may not be the Holy Grail of b2b strategy, but it surely is another string to the marketer’s bow. In other words, it’s an opportunity to hit the bullseye – but only if done well. If done poorly, your set of personae might as well be stray arrows flying off course.

With that in mind, here are 7 tips for creating personae and embedding them within your organisation:

1. Segmentation is effective in supporting persona creation, but is not a necessary condition

For a time, segmentation and persona development were considered to be one and the same. Maybe this all comes to down to semantics? Are personae simply segments in disguise? Is this merely a marketing buzzword which will be replaced in due course with something else?

Certainly, segmentation and personae are connected in terms of the objective: to establish distinct and targetable groups with an organisation’s customer base and/or market. The distinction however, is in presentation.

A segmentation delivers a typology of the customer or market universe: which “types” of customers/prospects exist? A persona is – wait for it – personified. Rather than “Segment A”, we have Stephen.

Rather than the “Performance Seeker” segment, we have Emma the chemicals buyer, who happens to prefer to procure top-end services for a premium price.

It may seem petty to make such a distinction. Ultimately though, it comes down to basic human psychology.

One of the challenges organisations face with segmentations is that it can be difficult for teams to understand segments in ways that stimulate ideas and actions.

As human beings, it is much easier for us to articulate a response to somebody than something. Personae are therefore a practical solution to a major pitfall of segmentation, adding a personality to an otherwise faceless segment.

The persona creation journey needn’t include segmentation, at least not in its traditional form. Typically, segments are created as a result of a dedicated research effort, be it quantitative (enabling a statistical segmentation) or qualitative (enabling a directional segmentation).

Many organisations have been slow to adopt personae in the absence of a segmentation. It is important in these circumstances not to let perfection be the enemy of good. A solid segmentation effort provides a strong foundation for persona creation, but it is not a condition of entry.

2. Insights to inform personae don’t all need to come from research…but it does help!

By the same token, organisations should not feel handcuffed by a lack of primary research or data on the customers or markets of focus. Certainly, research helps to inform personae. It is not the “be all and end all.” Before putting pen to paper on your personae, consolidate any insights from the following sources and establish any gaps in your knowledge:

  • Primary market research (surveys, focus groups, speaking to customers)
  • Secondary market research (desk research, articles, reports)
  • Internally-held data (on markets, customers, sales figures)
  • Anecdotal insights / instinct (drawn from experience)

Be careful not to underestimate the value of experience here, especially if there is a dearth of objective, independently-gathered insights or data.

As with segmentation, the question here should not be whether or not personae can be created without research; it should be “how valuable could our personae be using research from a range of sources?” Ultimately, organisations should work with what they have and what they can feasibly obtain.

Do not fall foul of the Nirvana Fallacy: the choice between an imperfect achievable outcome and a perfect but unachievable outcome is a simple one.

3. Conduct a brainstorming session to transition from segment/group to persona

Whether or not your personae are guided by research and/or a segmentation effort, it is important not to “jump the gun” during the development process. Stephen or Emma (or whatever you choose to name your personae) cannot be borne from nothing. It is much better to think first of groups and to describe them as such, before putting a face and a name to that group.

This may seem mundane, but it will lead to more relevant personae, with specific characteristics linked to your target audience.

Before asking “what is Stephen’s inside leg measurement?” ask “what does Customer Group 1 look ?” in terms of structure, size, industry, individual role, need, behaviours, etc.

In short, don’t drown in your creative juices before you’ve had a chance to get the boring stuff the way.

Once your organisation has a description of customer/market groups in place (however basic or sophisticated), it is time to get all relevant stakeholders in a room to create the persona themselves.

Any research should be made available and descriptions of the segment/groups should be present and widely understood.

Aim to create most or all of your personae in this creative, “brainstorming” session, rather than getting bogged down establishing a detailed implementation plan, which may risk distracting and derailing what should be a hyper-creative exercise.

4. Don’t worry about generalising – a persona is a “best fit” characterisation

One of the major pushbacks we experience when helping clients to create personae is the view that each persona must perfectly describe an individual customer (or worse, perfectly describe every customer within the chosen segment). What’s more: organisations often become sceptical of personae because they may seem exaggerated or caricatured in some way.

Our response to that is that there is a difference between a persona and a person – an actual, real-life person. If we apply no distinction between the two, then an organisation with 1,000 customers must have 1,000 personae.

In a perfect world, we would speak to and serve each customer differently. We would have a unique understanding of each customer that can be applied to sales and marketing activity.

Unfortunately, we live in a world with limitations.

Therefore, organisations work within their boundaries rather than not working at all. Think of each persona as a “best fit” characterisation. If Emma is 40 years old and works for a large refining company, and not every customer within the group is 40 years old and works for a large refining company, that’s ok.

5. The clue is in the name: each persona should be described in terms of a person

Here’s where the creativity can go into overdrive. The most effective personae are not those which simply describe Emma, her age and the company she works for. Your persona needs a personality. He/she needs physical, social and emotional characteristics, as well as backgrounds, goals and values.

It may be difficult to make the leap from “what products shall we sell to Segment 1?” to “what is Emma’s favourite book?” It is probably best to work towards this in stages in the brainstorming session. For example:

  • Exercise 1: describe a day in the life of the persona (strong, tangible link with the business; little creativity required)
  • Exercise 2: create a LinkedIn profile for the persona (focus on professional behaviours and needs; direct link with the business; more creativity required)
  • Exercise 3: create a profile for the persona (focus on personal behaviours and needs; indirect link with the business; most creativity required)

One small caveat here: in attempting to be creative and provide Emma/Stephen with a personality, you may find yourselves moving so far away from the business goal that it becomes difficult to drive action your understanding of the persona. Best practice here is to force a justification of a characteristic or descriptor before it is added to the persona “profile”.

If knowing that Emma s science fiction novels can tell us (or remind us about) something of her purchasing needs or service requirements (e.g. she craves innovation and is willing to think outside the box when considering products), then it should be included.

If it is entirely superfluous and has the potential to cause a misunderstanding rather than a better understanding of the customer, it should be avoided.

6. Implementing the persona is impossible without visualisation and visibility

Once your “family” of personas are in place, the journey does not end. On the contrary, this is merely the beginning.

It is ly at this point that each persona is familiar only to a small group of people within the organisation, and only exists in the form of scribbled notes and (possibly) the odd sketch.

The personas must now be brought to life and introduced to the rest of the organisation.

Variety is the spice of life and organisations should endeavour to visualise their personas using a range of media. Examples adopted by others include (ordered from basic to complex):

  • Profile posters with photographs of each persona, accompanied with key characteristics and a description of key needs, products, sales/marketing messages which may resonate strongly.

    These posters should be distributed to employees and prominently displayed in offices/locations. You may also wish to create cardboard cut-outs of the personas, which then take up residence in meeting rooms or other office space.

    During internal discussions, staff should look over their shoulders and ask “What would Steve say?”

  • LinkedIn and/or profiles, designed to look realistic and sometimes actually created (enabling “connections” or “friendships” with people within the organisation).

  • Email messages from personas to introduce them to the organisation and to enable a direct interaction with them. Personal contact with personas triggers interest and deepens understanding of different customer segments.

  • Online portals, offering an interactive platform to explore the different aspects of a persona’s life (i.e. having a look at the persona’s work desk, his/her social media profiles) and to offer extensive information in an easily digestible format.

  • Face-to-face interactions with actors playing personas at internal events brings personas to life in a literal sense, initiating further conversation and making it a memorable experience for each employee.

7. Encourage conversations around the personas and keep them up-to-date

The ways in which a persona can be visualised and embedded within an organisation are endless.

Try to think of other ways in which you could encourage a conversation about your personas and create a long-lasting impression among your colleagues.

The ultimate goal here is to develop a company culture of customer centricity, helping to keep the customer (and different customer types) at the forefront of all strategic decisions and in everyday operations.

Markets, competitors and customer requirements are constantly evolving. Therefore, it is essential that you revisit personas periodically. This process should be done twofold:

1. Continuous persona development

The best way to keep your personas relevant is to spark on-going anecdotal conversations discussing how the persona could have evolved over the past few months (i.e.

How would Steve be feeling about the new industry regulations affecting companies his?) Ideally these conversations should happen frequently.

If you’re finding that this isn’t naturally the case, make an effort to get together to discuss every 3 months.

2. Formal persona audits

Every 3-4 years, you should revisit the whole persona creation process, refreshing any research you may have, creating personas from scratch and developing a revised strategy on embedding personas in your organisation. It is not recommended to carry out the process more frequently than every 3 years, as you can easily lose momentum and fail to take full advantage of the benefits of your existing personas.


1 Oxford English Dictionary


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