Why Deals Fall Apart?

“If it is important to you, you will find a way. If not, you will find an excuse.”

Whether you are a business buyer, investor or a business owner, you must be wondering, what are the conditions that can make or break a deal. We have worked closely with thousands of users over the last few years in buying, selling, growing and fund-raising for businesses, and one of the most common questions we get asked is: What can make or break a deal? In this article, we bring to you our exclusive insights on keeping a deal smooth and hassle-free. Over the last few years, we have helped thousands of users on our platform to discover the best deals to buy, sell, grow and fund businesses, and this is a common question we get asked.

While there are no hard-and-fast rules about stopping a deal from collapsing, there are, however, a few important principles that both parties in a deal can follow which can make or break a deal.

1. Transparency and Honesty: This is a no-brainer. Would you ever like to enter into any transaction with someone whose ethics, integrity and morals are in question? Most likely not, and the same holds for the other party. The best deals are those in which expectation settings are clear right from the beginning. This is not to say that you must lay bare all the sensitive information about your business on the very first day. You can take your time and qualify buyers as per their seriousness and interest in your business before giving out critical information. However, do not lie, misrepresent or miscommunicate, and encourage the other party to do the same.
2. Trust and Confidence: Sometimes, it is not enough to be just honest yourself. You have to give a chance to the other party to demonstrate honesty and commitment to you. We have seen a number of deals fall apart where either one or both the parties refused to walk the last mile with each other despite long discussions and no visible breach of honesty. There are a number of legal tools available to enforce understanding between two parties even before the deal actually takes place. But, in the end, these are just tools – you will have to cultivate the trust by yourself. Seasoned deal moderators and mediators often come handy in developing rapport between parties and getting the deal through.
3. Realistic Negotiations: An important thing to remember is that, negotiations on aspects like valuation, payment terms, rights and obligations, etc. are meant to bring out a fair deal structure, and not to solely serve the interests of any one party. For example, a common mistake that business owners make is to overvalue their business. Get your business valued by an independent valuation expert to avoid unnecessary conflict. Have a seasoned negotiator on-board to help you get the best out of the deal without undercutting the other party.
4. Seamless Communication: A deal is never just a piece of paper. It happens between two people, or two parties, and to bring the deal to closure through a long journey, it is important that communication between them is regular, well-timed, and two-way. Take out time to listen to the other party and voice your own concerns. Rope in your consultant when needed, but stay connected to the deal at its core by getting regular updates. Technology has made life easier today, but it won’t harm to meet each other once in a while and iron the kinks out. It is also important that you talk about things outside the deal such as your work experience and professional background, future plans, and so on.

So, what are you waiting for? Discover the perfect business opportunity that matches your preferences and get the deal of your dreams with Indiabizforsale.com, the most preferred network to buy, sell, fund and grow businesses in India. To know more about who we are and how we can help you, write to us at [email protected].