So, why wouldn't you want to divulge your entire customer list to a prospective buyer?
Seriously though, one major reason your business for sale is of interest to a buyer is because of the customer (or client) base. Obviously you would want to protect that valuable information until the right moment so as an alternative I suggest a list of the types of customer. For example a Commercial Cleaning company for sale may have a client list including the following:
Double Glazing Manufacturer
and so on............
Some data presented in a Sale Memorandum has to be abbreviated or held back as confidential so the buyer has to assess their interest on the basis of limited information. A customer profile like the above can assist especially if it also shows the percentage of turnover by customer. Over exposure to one or two customers is always a significant issue to the business and to possible purchasers.
The art (or is it a science) of presenting a business for sale and to move to the stage of meeting a prospective buyer is in the provision of well-presented, demonstrable data. The customer list, or customer profile list is just one part of the overall presentation.
Clearly many retail businesses will not have much detail on customers although E-Commerce and Mail Order businesses will have the information. There are restrictions under the Data Protection Act on showing this type of information but a picture of a business can be built up by matching the customer numbers to the types of goods sold. Put simply, a successful Online business should have lots of customer records, many of whom are opted in for newsletters and marketing etc. This is valuable. Let your buyers know.
October 13th 2015
Keith Green - selling businesses and advising SME business owners since 1997 and still enjoying it.
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