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The Importance
of Confidentiality In A Business
Transaction |
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by Scott Radin at the
Business Broker Training Center |
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The importance of confidentiality at all times
during the sales process is the most important
ingredient in the successful sale of an existing
business. This IS NOT a real estate transaction
where real estate is posted on public MLS
services for everyone to find. This is a
business with employees, customers, competition
and possibly landlords and creditors. By making
a business for sale public, all of the above
mentioned entities associated with the business
for sale will be thrown into a “cause and effect
“ flow that will permanently harm the business
being sold.
Ask yourself the following questions relating to
confidentiality…
1. How would your employees react if you told
them that you are selling?
2. How would your customers and clients react to
you selling?
3. What would your immediate competition do if
they knew that you were selling?
4. If you have a landlord – how would they react
to you selling while under lease?
5. If you have suppliers etc extending credit –
how would they react?
If you answered the following then
confidentiality should be vital to you…
1. They would leave and/or have a negative
attitude worried about job security.
2. They would go elsewhere worried about the
quality of the product or service.
3. They would use in their
marketing/advertising/sales to sway business to
them.
4. They would not be happy and in the worst case
could call the lease.
5. If they are extending credit then they may
pull credit and go to COD
The
extent to which confidentiality is applied goes
well beyond what most business owners have
knowledge of and access to. There are specific
forms and agreements that protect
confidentiality. There are entire processes that
protect confidentiality.
If the engine on your vehicle broke down, would
you start replacing parts yourself or would you
take it to a reputable mechanic? This is no
different than a business owner attempting to
protect his or her confidentiality. Let an
expert protect confidentiality at all times
FAILURE TO PROTECT CONFIDENTIALITY WILL RUIN
YOUR BUSINESS
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