The Keys to Completing a Deal
M&A can be a rollercoaster of a process. One day, it might feel like everything is wrapped up in a bow only to fall apart the next day. And then on the third day, it all comes together. Set yourself up for success by following these four guidelines:
Keep Emotions Out of It
Easier said than done since we are all human beings, and your staffing firm is important to you! But at the end of the day, it’s a business transaction, and keeping a cool head will help get the deal done.
Get on the Market
The best way to know your value is to talk to actual buyers about it. While appraisers can be helpful, sometimes you have to dive in and have the real conversations.
Don’t Bite at the First Offer
Having options is key. The more options you have, the better chances of getting a great deal.
…But Also Don’t Hold Out Too Long for a (Slightly) Better Offer
Part of something is better than all of nothing. While you want options, holding out for a marginally better offer that may never come is a how you stay in limbo forever. Set a deadline for yourself so that you don’t get stuck in the waiting game.
5 Ways to Prevent Deal Fatigue
Negotiating a company sale can be a long and arduous process.
“Deal fatigue” is a common feeling that can arise during drawn out negotiations where participants feel discouraged and frustrated while trying to reach an agreement. Here are five tips to prevent deal fatigue and have a successful transaction:
1. Preparation is Key
Negotiations are going to require that you disclose information, whether you are the buyer or seller. Before the deal even starts, work with your team or an advisor to prepare the necessary financial history information.
4. Communicate Often
Surprise, surprise – communication is key. A dedicated project manager who can act as point person is essential to this. That person can then coordinate status calls, meetings, and task lists. Both parties can then be in the know.
2. Make Sure the Market Is Ready
Preventing deal fatigue might also involve asking a basic question – is this the right time to enter the market? If the current market is volatile or rates are sky high, you might want to rethink your plan. Factors to consider: • Interest rates • Tax rates • Competition landscape • Job market
3. Have a Timeline
Creating a timeline will help the process. Create one that takes into account factors like your reasons for selling, how long it will take to procure data, etc. Often, negotiations will move from one step to another without a clear ending in sight. Holding firm to your predetermined timeline can help prevent deal fatigue.
5. Have a Team of Trusted Experts
Advisors and experts can play a big role in preventing deal fatigue. Each side can use the help of valuation specialists, advisors, legal representation, and accounting professionals to make the transition smooth.