It was only a chance discussion really.

I was out the front of my house doing a bit of a clear up when one of the neighbours walked by and asked how it was going.

We had a discussion about the economy and I was telling him about some of the conversation that I had had recently with James Martin, a partner at Begbies Traynor that I know.

Surprisingly, Begbies ( who are known for their insolvency work ) are not quite as busy as you might have thought – because for lots of reasons companies are not going  bust in the numbers that you would think was happening. Loads of reasons for this and I will try and get James to come on here and outline his thoughts on the subject soon.

Anyway – back to the point – so one of my neighbours tells me that he had failed to sell a company where he was a shareholder.

Or, more to the point their accountant had failed to sell the company ( but had managed to walk away with a substantial amount of fees ! ).

The one bidder ( !! ) had unsurprisingly ( to me ) managed to find loads of reasons why they should not complete the deal.

A ” dummy ” competitor had been contrived but the ruse failed because the M.D. of the one company called the M.D. of the other company and  said something like ” are you really looking to buy this company ” to which the answer was ( of course ) – No !!

So, that was the end of that little plan !!

In fact I have been working with a number of companies recently who finally realised that the only way that they were going to get a result was by creating serious competition for their business. Not pretend competition but real competition.

Selling a company ( like raising finance for a company ) is not an accountancy exercise it is a sales and marketing exercise. The chances of an accountant understanding this are close to zero.

The main problem is one of the main reasons that I started this blog – most business people do not know where to go to to get advice and guidance on how to sell a business. Because of this they end up going to their lawyer, accountant or ” one of their mates ” .

We nearly made the same mistake ourselves when we sold Voyager. In fairness our F.D. had raised his sights above our day to day accountant and was talking to Deloitte & Touche ( who we had earlier used for an acquisition ) and Deloittes have a lot of experience in selling businesses. However the key decision that we made at that time was to have a ” beauty parade “. I still remember the day that we wondered around Birmingham while Deloittes, Ernst & Young and someone else ( I can’t remember who ) presented to us on why they should be our representatives in the sale of our business.

In the end we chose Ernst & Young ( after much discussion ) for loads of reasons – we liked them, they had the best process, they would market us globally, they understood our market and the opportunity etc etc

The way to get a great result is to pick the right adviser in the first place – it is highly unlikely to be your lawyer ( although we did use the same lawyer for the sale as we did for the acquisition ) or accountant !!