You are thinking about acquiring a business. Let's face it, you probably won't. Neither will 990 out of the 1,000 "potential buyers" that will contact my office this year. Being a business broker in the Philadelphia area, I can tell you from experience that the vast majority of buyers are not serious and are just "kicking tires." It does not take long for business brokers to become callous and short with the vast majority of prospective buyers inquiring about a business. Truth be told, business brokers can tell pretty quickly if a purchaser is really serious or not. That being said, here are a few pointers to help you pass "tire kicker" status if you are a really serious shopper.

Tip 1: Make up your mind that you are a really serious buyer. Business brokers get telephone calls all the time from buyers who think that they may make the leap from their weekly paycheck if they come across the right business. If you believe that you are going to locate the "perfect business" where the risks are nonexistent and everything is perfect, you are kidding yourself. Each and every business has risks connected with it. If you are very risk adverse you probably aren't an entrepreneur and ought to retain your day job. If you have been looking at businesses for more than a year and have turned down possibilities because you don't like the color of the paint in the broom closet, you most likely are not a serious purchaser. If you know in your heart that you are an entrepreneur and you know that you are serious about making the jump and you understand that there is no perfect business out there and that you are going to have to take on some risk, than quite possibly you are ready to become a serious purchaser.

Tip 2: Let the business broker know that you have narrowed down the type of business you are shopping for. There are some people out there that scan the business for sale websites and inquire on almost everything. I have seen the same tire kickers over and over inquire about my businesses. They have inquired on every thing from durable medical equipment companies, to commercial cleaning companies, to restaurants and bars. It is a major red flag to business brokers that the buyer has no concept of what they are looking for and is open to anything that "makes money."

Tip 3: Don't wait forever to acquire something. It is a huge red tire kicker flag when buyers reveal to business brokers that they have been hunting for a business for more than a year. I have noticed the exact same potential purchasers for several years. These individuals are never going to make the leap.

Tip 4: Have your money ready to go. You will need a significant amount of money to purchase a business even if you are acquiring financing. If you do not have any capital, please do not waste our time. Business brokers don't want to hear that you have some mystery investor backing you because you don't. Sellers are not likely to 100% finance your transaction and you won't have money to place down on a bank loan. If you don't have funds, you might be a serious buyer, but you clearly are not a viable one.

Tip 5: Have your resume, personal income statement and proof of capital ready to go. Nothing impresses a business broker more than a buyer who instantly sends over their resume with their past practical experience and evidence that they have the cash to buy a business. If financing is likely to be necessary, we have to know that you have some relative experience with the industry of the business that you are inquiring about. Banks are not going to fund your acquisition of a commercial construction company if you do not have any commercial construction expertise.

Tip 6: Fill out the business brokers requested information and confidentiality agreement. If a possible buyer refuses to execute a non-disclosure or confidentiality agreement they are not really serious. They are either a nosy competitor or a good example of the ultimate tire kicker. I have had "potential buyers" refuse to fill out a confidentiality agreement. I will not give them any details and it would have been much better if they did not even make contact with me at all. In addition to the confidentiality agreement, make certain to provide any requested information thoroughly. If a prospective buyer is too lazy to fill out an income statement or a buyer questionnaire, then they almost certainly are not that serious.

Tip 7: Do not ask for any specific details about the business unless you have executed the confidentiality agreement. Your first contact with the broker must not be this: "Hello I am interested in your Business for sale. Please send me the previous three years of tax returns, profit and loss statements and balance sheet." This can make business brokers think that you are a competitor or just a curious individual. It doesn't give business brokers the impression that you are a serious business purchaser. Occasionally prospective buyers nag business brokers and attempt to get the place of the business or other identifiable information. Business brokers do not have the discretion to give your this information as we have a duty to safeguard our client's business. Our clients have requested us to get confidentiality agreements executed before providing information. Please do not request us to violate our obligations to our clients. It's irritating. The faster you get the executed confidentiality agreement back to the business broker the quicker you will get the information that you want.

Tip 8: Have a good reason prepared for why you are wanting to purchase a business. Tell the business broker that you have been laid off from your job and are now inclined to jump into owning your own business. Tell the business broker that it has always been a desire of yours to save up for a down payment on a business and go out on your own. Tell the business broker that your family has been in the business forever and now it is your turn to go out on your own. What you do not want to do is call the business broker and have no reason as to why you are thinking about obtaining a business.

In conclusion, if you want to stand out from the pool of tire kickers, convince yourself that you are serious, narrow down what you are searching for, don't take too long to purchase something, have capital ready to go, send over your resume, income statement or evidence of investment, execute the business brokers confidentiality agreement and completely fill out any requested information, don't ask for specific information prior to executing a confidentiality agreement and have a good explanation as to why you are wanting to buy a business. If you do all of these things, you will naturally standout from the crowd of tire kicker buyers and be identified as a serious purchaser.