Evaluating Potential Buyers: What to Look for Before Entering the Market

One of the most overlooked — yet critical — steps in a successful business sale is evaluating the type of buyer you want to attract. Before you even take your business to market, it pays to be clear about what a ‘good buyer’ looks like. The more prepared you are, the more likely you are to attract serious, credible interest — and avoid wasting time on the wrong parties.

At ExitPlanning.co.uk, we work with business owners to define, plan, and execute successful exits. Let's outline the key factors to consider when evaluating potential buyers before you begin the sale process.

Why Buyer Profiling Matters

Not all buyers are created equal. Some want to acquire, some want to asset-strip, and others simply aren’t ready or funded to complete a deal. By identifying your ideal buyer profile upfront, you can:

• Shape your marketing and messaging more effectively

• Attract aligned, serious acquirers

• Reduce risk of delays, renegotiations, or failed deals

• Maximise your final sale value through competitive tension

1. Strategic Fit

Buyers who see strategic value in your business are often willing to pay more — and move faster. Consider:

• Does your business complement theirs? (e.g. geography, customers, capability)

• Are they looking to enter your market or expand share?

• Would they benefit from your contracts, staff, or IP?

The more synergy they see, the more compelling your business becomes.

2. Financial Capability

Even the most enthusiastic buyer is no good if they can’t fund the deal. Look for:

• Proof of funds or access to acquisition finance

• Track record of completed acquisitions

• A credible plan for funding deferred consideration or earn-outs

Red flag: If a buyer delays or avoids conversations about funding, tread carefully.

3. Deal Certainty & Experience

Acquiring a business is complex. Experienced buyers are more likely to:

• Conduct fair and timely due diligence

• Understand your value drivers

• Engage constructively with advisers and stakeholders

• Stick to agreed timelines and terms

If a buyer has never acquired a business before, factor in the risk of delays or deal fatigue.

4. Cultural Alignment

If you're concerned about your employees, customers, or legacy, cultural fit matters. Ask:

• How do they manage and retain staff post-acquisition?

• Will they preserve your brand or integrate it fully?

• Do their values align with yours?

In many cases, a smooth post-sale transition is just as important as the deal itself.

5. Motivation & Timeline

Why is the buyer interested in your business?

• Are they actively acquiring as part of a strategy?

• Are they opportunistic or exploring multiple options?

• Are they under time pressure to complete?

A motivated, focused buyer is far more likely to reach completion.

6. Buyer Type – What’s Right for You?

Here’s a snapshot of common buyer types:

🧑‍💼 Trade Buyer

Often a competitor, supplier, or complementary firm. Strategic synergy may lead to a premium price.

💼 Private Equity / Investment Buyer

Typically interested in scalability and returns. May want you to stay on for a few years and reinvest.

🤝 Management Buyout (MBO)

Your existing team acquires the business. Can be smooth but may require external funding.

👥 Employee Ownership Trust (EOT)

Sell to a trust for the benefit of your staff. Zero CGT, but requires stable cash flow and cultural fit.

🔍 Search Fund or Private Buyer

Often first-time buyers looking for a good SME business. Can work well if experienced and funded.

Each has pros and cons — and understanding what you’re open to will shape your preparation.

7. Red Flags to Watch Out For

Not every enquiry is worth pursuing. Warning signs include:

• Excessive focus on price before understanding the business

• Unwillingness to sign a Non-Disclosure Agreement (NDA)

• Overpromising with little substance or clarity

• Reluctance to provide personal or company credentials

• Attempts to bypass your adviser or speed up the process

A structured sale process and screening mechanism can protect your time and confidentiality.

8. Work With an Adviser Who Can Qualify Buyers

If you use a qualified adviser, they should support you with:

• Defining the most suitable buyer profile for their goals

• Preparing the business to attract and engage serious acquirers

• Running structured, confidential marketing campaigns

• Screen, qualify, and negotiate with potential buyers

• Managing the process through to completion

The best buyers don’t just show up — they’re identified, approached, and engaged professionally.

Evaluating potential buyers starts before your business is on the market. The clearer you are about who you want to sell to — and why — the more control you’ll have over the process, the price, and your legacy. With proper exit planning and experienced support, you can attract the right buyer at the right time — and exit with confidence.

📞 Want help planning your exit strategy?

to book a confidential call and explore how we help business owners prepare and position for a successful sale.