When you advertise your business for sale online, your marketing efforts will benefit from your inclusion of one key item. Besides financial documents, lease agreements, and your license, you must share with qualified buyers a business teaser, otherwise known as a comprehensive, one- to two-page document that describes your business to its fullest potential. A business teaser offers facts as well as inspirational descriptions of your business’ value. Consider the following when writing such a memo.
A business teaser delivers facts without revealing the identity and location of the business. You will want these aspects of your business to remain confidential during the first stages of qualifying potential buyers. Sensitive information regarding whether your business is for sale can be discovered by your competitors or your employees, who may feel threatened and quit your business. Moreover, a business teaser should not exaggerate the truth, as all information therein will be verified at some point in the future via financial documents prior to the close of escrow.
If your business teaser is confidential, what kind of information will you include? Take the time to break down the document into a meaningful, organized structure. First, start with a business description, summarizing your business history, including relevant facts such as your motivation for getting into the business, how the business concept was developed, and whether the business is a sole proprietorship, partnership, LLC, or corporation.
Next, include a brief description of your products, the business’ organizational structure, operations, markets, and what, if any, advertising strategies you currently employ. Information on operations may include your hours, a list of equipment, your seasonality, and a description of your staff.
Then, and though it may seem counterintuitive, continue by making a list of areas to be improved upon. You’ll want to create the expectation for growth and establish that, if a new buyer comes in a takes over operations, he or she may do something different that will compensate for what you’ve failed to do thus far. You don’t want to give the impression that you operate your business to perfection, and that, as a result, there is no room for growth. Touching upon a few non-major weaknesses is essential to getting potential buyers interested. For example, you could highlight the need for increased advertising, with the implication that, if put into practice by a new buyer, business growth can be expected.
Last, you’ll want to provide an overview of what your competition looks like. Without disclosing confidential information, list your competitors. Then, end with a description of your position among your competitors and how your business operates at an advantage.
These are the fundamental elements of a business teaser that will serve to notify prospective buyers of your business’ value, its position in the market, and its potential for growth. Without disclosing the confidential aspects of your business, an introductory memo of this kind will create a professional impression. Plan to distribute this teaser to potential buyers who are not yet vetted financially to give them a taste of what they can expect. After all, you don’t want to get caught short when potential buyers respond to your marketing efforts.