: tools & methods for small businesses

For a very long time one of my consulting specialties had to do with helping companies plan for turbulent times.  We *used* to think we knew what turbulence was…  While the specific methods could get us bogged down in really silly-sounding ‘consultant speak,’ one of the most important things we argued was that the future is NOT going to be like the immediate past – except more so …  

We see this everywhere. In boom economies, breathless enthusiasts tell us that Everything Is Different Now — that only Old Farts and zombies from The Last Century worry about, oh, profits and cash flow.  And in troubled times, we start seeing events that conjure up scenes of Dustbowl Depression and Grapes of Wrath.  

Look.  Neither is right.  

That said – the profession of business brokering needs to face the current reality:  a large share of its regular clientele, Main Street Businesses, is nervous.  People are holding tight.  

There are a lot of businesses, often Main Street stuff that go up on the sales block.  I think there’s some (suspect) factoid that at any one year in the US, there’re nearly a million companies held up for possible sale. 

One of the intro sidebars in this blog is the factoid that any any time, there may be up to one MILLION small businesses on the sales block.  Now, the dirty secret is that most don’t get sold.  And – no sale, no commission.

 The flip side – for every business that wants to be sold, there’re (I’m guessing) a number of serious potential buyers.  So – the numbers are better. If there’re a million businesses for sale, there might be X-million potential buyers.  BUT – conventional wisdom (and custom) is that these people are trotted around by business brokers – for free – to see or hear about potential company opportunities. 

 For Main Street company buyers (or, tire-kickers) free service is the industry norm. 

 BUT, two factors might be at play here – making conventional wisdom about free-service-for-buyers a bit less inflexible.

 On one hand is a changing demographic for buyers.  Boomers who’d had successful corporate careers, who’ve acquired business savvy along with nest eggs, might be the next big wave of company buyers/entrepreneurs. These are buyers who would benefit from a bit of ‘buyer coaching.’  Services that do ‘opportunity-searches,’ that help assemble management expertise (or that sub out research that the potential buyers have to do but don’t really want to do it themselves), hand-holding through the loan application process, helping potential buyers see mid- and longer-range strategic business opportunities, even professional and managerial coaching to bring corporate-smart potential buyers up to speed on business specifics that they’ll need to be successful.  ALL of these could be a la carte consulting services for a ‘new’ kind of business brokerage profession.

 And on another hand – the nature of the buying clientele changes when a business brokerage  goes ‘upstream’ in terms of business size. That becomes a world where brokers deal with individuals working on behalf of other (wealth managers) and small groups (PEGs, angel investors) who expect a greater level of service in helping locate opportunities. AND, as professionals who sell their services, I’ll bet they’re comfortable with the idea of paying for professional services.

Some of those services could be borrowed and modified for this class of buyers:  ‘strategic recasting’ for example.  AND, most likely, these are potential buyers who would see tremendous value in acquisition ‘scouting.’ 

These are possibilities.  Spit balls of ideas.  And as such, a lot easier to talk about than to implement.  (there are even professional guidelines on how licensed business brokers may or may not help clients and from whom they can accept money.  

These are times when creativity can be rewarded.  Doing what Every Other Business Broker does is a tough way to ride out this economic slowdown.  Who will come up with new ideas, new products and services, ways to broaden customer bases?