Third Party Representation

A third party unrelated to buyer or seller; afforded access to confidential information for analytical and valuation purposes under agreement that it will be held in confidence unless and until there is written agreement to proceed...

Seller Representation:  For reasons outlined below and described in Sell a Business section, davidsonashe will most typically represent the Seller of a Business; rarely a Buyer for a number of reasons.

To Avoid Conflict of Interest: If we were to commonly represent either buyer or seller, sooner or later we’d find ourselves representing conflicting interests. Since we thought this would NOT be a desirable situation, we decided we had to choose one or the other, as a general policy.

To Secure Confidential Information:  Buyer and Seller both will (should) ask for material information from the other, in order to evaluate the opportunity each is offering the other.  In that exchange, the great preponderance of information will be that pertaining to the business, and business owners will often become nervous and reluctant at this point.

On one hand, the buyer wants and actually needs information to assess a meaningful level of interest.  On the other, the seller doesn’t really want to disclose confidential information until quite certain the buyer is in fact capable and actually interested in buying, not just in looking and learning.

When the objective of both parties is the purchase and sale of the business, subject to what is learned by each during the diligence process,  our roll as broker is most beneficial when we focus on that information, and that is best accomplished while representing the seller.

Buyer Representation: Buyers do seek our assistance often, but usually not under terms of engagement or representation. We are seen as a party who may know of something or may learn of something that might be of interest to them.  Most buyers don’t want or need the formal representation of a broker.  Buyers want to be free to solicit help from where it can be found and to look wherever the search may lead and, usually, that makes sense, since a buyer’s need for stealth is usually not the same as it is for the seller.

Occasionally, when a buyer has a narrowly targeted search criterion, or when a specific company in is the target, or perhaps a board geographic criterion that takes us outside our own market, we may be asked to represent a buyer.

Self Representation: Many business owners will try to sell their company on their own, without representation, for a variety of reasons. That may not be most advantageous since, from the outset, the owner-seller will generally be operating from a compromised position; in particular, between confidentiality necessary to the protection of the on-going business, and the full disclosure required to equip a buyer with the knowledge and confidence to make a full fair market offer.

In addition, quantity and quality of buyer may be compromised, assuming the owner will not have the best access to pre-qualified buyers, or at least not without risking confidentiality.  Presentation and justification may be compromised, because the owner will probably never be viewed by the buyer as an objective analyst. Time and effort may be compromised between that devoted to the selling process vs. that devoted to running the business, the result of which may be compromised earnings and ultimately, a compromised selling price.

7 Selling Steps

About Us

davidsonashe was founded in 1996 as an affiliate member of the Business Brokers Network of more than 350 affiliated business intermediaries; business brokerage and consulting firms located across the United States and Canada. Locally, we have offices in Langley, BC and Lynden, WA and have been intermediaries instrumental in the sale of companies in northwest Washington and the British Columbia lower mainland since 1996.

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