When limousine and chauffeured transportation business owners approach a business sale, they address many variables that will influence the success of their industry exit.
Some of these variables include: a business valuation, consulting financial advisors and transaction tax strategists, hiring a business broker that understands their industry, etc.
However, many business owners neglect to address the most explosive variable in a business sale: emotional intelligence. Emotional intelligence can be described as the ability to identify, assess, and control the emotions of one’s self, of others, and of groups. For many limousine or chauffeured transportation owners, their business sale is the greatest financial transaction of their lifetimes. With so much on the line and so much hard work invested into the business, it is understandable that business owners can be overwhelmed by the emotional swings of the process.
As a result, business owners can make irrational decisions that lead to explosive surprises and eventually a dead deal. If you are not able to demonstrate emotional intelligence throughout the process of your business sale, all of the other preparations you have made for a successful industry exit may not matter. So how can a business owner ensure that emotional intelligence is accounted for in a business sale? Here are a few quick tips.
Spencer Tenney, vice president of The Tenney Group, based in Arlington, Tex., is a member of the International Business Brokers Association and a Certified Business Intermediary (CBI). The Tenney Group is focused on business sales, acquisitions, business valuations and exit planning in the transportation industry. Information: firstname.lastname@example.org; www.thetenneygroup.com
Controlling your emotions
I always prepare my clients for the inevitable emotional roller coaster of a business sale in advance. It is critical for sellers to attach their focus on what the sale of their business will allow them to accomplish in the future. For example: more time with grandkids, better lifestyle, taking chips off the table, cash for a new business venture, etc. This is how you control your emotions and protect your transaction. When business owners direct their focus on the past and the cumulative blood sweat and tears poured into building the business, they invite emotions into the process that are extremely counterproductive to a successful outcome.
Controlling the emotions of others (buyers)
The party whose emotions a seller should be most concerned about controlling is the buyer. If you want to be able to control the emotions of a buyer, you need to be able to control the transaction process. The best way to control the process is to hire an experienced industry specialized business broker to lead it. Additionally, buyers will mirror the emotions of a seller. The deal table is no place for “hot heads.” A third party professional is able to facilitate negotiations constructively and in a way that allows both buyers and sellers to be protected from their emotional off-the-cuff remarks or knee-jerk reactions that can disrupt a very fragile process.
Controlling the emotions of groups (family)
Even if family members are not shareholders, they can be significant influencers in the success of a deal. Controlling their emotions through the process is an important component of sellers accomplishing their exit strategy goals. To control the emotions of these influencers, sellers need to get family members involved early in the process, provide them clear expectations about how the sale will affect them, and continue to communicate with them throughout the process. This will protect the seller from emotional explosions from within his own camp, which can be very destructive to the success of a sale.
Again, if you are not able to demonstrate emotional intelligence throughout the process of your business sale, all of the other preparations you have made for a successful industry exit may not matter. Surround yourself with professionals who understand the sale process and who understand how to control the emotions of all parties involved — especially yours.