You have spent decades building your business, and a competitor suddenly offers to take it over. The offer looks appealing. But hold off before shaking hands: alone against a motivated buyer, the negotiation is likely to tilt in their favour rather than yours.
Why? Because a buyer alone at the table controls three decisive levers: information (they often know the market value of a business like yours better than you do), the pace (they set the timeline) and anchoring (the first amount put on the table becomes the reference point for everything that follows). With no other buyer in the running to create competitive tension, nothing corrects this imbalance, and that is exactly what is at stake when you respond to an unsolicited approach.
Selling a business is nothing like a one-off transaction. It is a structured process, often spread over several months, where the price obtained is only part of the equation: you still have to choose the right buyer and negotiate terms that protect your long-term interests.
A Key Question to Ask Yourself
Before even discussing valuation or potential buyers, some personal reflection is in order. “The first step in a sale is not financial, it is personal. Above all, an owner should be able to answer one question clearly: why sell? That answer then guides every decision in the process, from the type of buyer you target to the terms you accept or reject,” explains Frédéric Bélanger, CPA, partner at EC2.
This groundwork may seem simple, but it changes everything. An owner who sells because their health requires it will not have the same priorities as an owner who sells because they see a growth opportunity elsewhere. Clarifying this why before assembling a team of advisors (lawyer, accountant, valuator, transfer specialist) helps frame decisions and stay anchored to your objectives throughout the process.
Creating the Conditions for a Better Transaction
Once the seller’s objectives are clear, the preparation work begins. The business must be thoroughly analyzed to document its strengths, its growth potential and what truly sets it apart from competitors. This step also serves to prepare the documentation used to present the business to potential buyers and answer their main questions.
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Next comes the search for buyers. The challenge is not so much finding buyers as identifying those who will truly recognize the value of the business. A strategic buyer, a financial investor and a competitor in the same sector are not looking for the same thing, and will not value the acquisition the same way.
Targeted candidates are approached confidentially. Those who show serious interest first sign a confidentiality agreement before receiving more detailed information about the business. They can then submit a preliminary offer, allowing the seller to compare several proposals and assess the different options available.
“We often think an advisor creates value by negotiating harder. The real value is created earlier: in the design of the process. Who do we approach, in what order, with what information, on what timeline? When these conditions are structured to put several qualified buyers in competition, the seller negotiates within a framework that favours them before the first discussion even begins,” notes Frédéric Bélanger.
Price Doesn’t Tell the Whole Story
When several buyers submit a letter of intent, the headline amount naturally draws attention. Yet the best offer is not always the highest, the expert points out. “Structure matters as much as the amount. What counts is the value the seller actually pockets and the risk they agree to carry after the transaction.”
A buyer may offer a higher price but provide for a significant portion of the amount to be paid several years later, conditional on the company’s future performance (an earn-out clause). Other amounts may be held back as a guarantee. Conversely, a slightly lower offer paid in full at closing can give the seller more value and more certainty.
The advisors’ role is precisely to analyze these different scenarios, quantify the risks tied to each and help the seller compare offers on a fair basis, so as to choose the one that best matches their objectives.
Staying the Course During the Process
A business transaction generally spans nine to twelve months. During this period, the owner must continue to run the organization, maintain its profitability and reassure their teams.
“Selling your business is an operational process in its own right, one that demands patience, rigour and expertise,” says Wandrille Lefèvre, CPA, partner at EC2. He stresses that the selling shareholders’ ability to stay focused on operations is essential to preserving the company’s financial health and reaching the targets set.
In an episode of EC2’s podcast Au cœur de l’action, Frédéric Bélanger also points out that, after devoting years to building their business, many entrepreneurs experience this stage with a heavy emotional load. Advisors help smooth the exchanges and keep emotions from taking over business decisions.
After all, beyond the numbers, a successful transaction rests on the ability to bring the seller’s and the buyer’s expectations closer together. “Each party comes to the table with its own objectives. The advisors’ role is to help create the conditions for a constructive dialogue and to find a balance that satisfies both sides,” sums up Wandrille Lefèvre.
For owners considering a transfer in the coming years, one thing is certain: it is better to prepare the sale before the buyer shows up. Back to the competitor from the start: their offer is not bad in itself, it is simply the only one on the table. Turning it into the starting point of a real process, rather than the finish line, is often what separates a good sale from one that is simply endured. The EC2 experts support entrepreneurs at every step of the process, from initial preparation through to the closing of the transaction.
Considering selling your business? Contact us to discuss your situation.
