Entrepreneurs come in the not-so-detailed, detailed, and everything in between definitions. Just like the rest of the human race.
One of my clients has an office in their house. Each hard-copy document is neatly placed in just the right three-ring binder. The documents range from every sale ever made, to photos of the inventory, the past umpteen years of financial performance. The computer has sections for this and that and the other.
Another client works the business from the check book. There in is a record of everything.
Yet another client keeps it all in a shoe box, mostly containing crumpled receipts for both purchases and sales.
To each of these individuals, it all makes sense to do this. One is working harder than perhaps necessary to keep it all just so. Another is frustrated when a detail question is asked about their business as they just don’t have time to find it.
The bottom line is that the broker first, in order to evaluate the business and the (hopefully) buyers that follow need to know whether it is all fact. The seemingly unending list of questions are an attempt to see and understand. In any of the defined entrepreneurs styles, there could be fact and fiction.
The broker should not be validating for the buyer what is fact and fiction but, instead representing what they see and questioning the larger questions, the obvious piece. The buyer must take responsibility to make certain that it all ties out.
Sellers of the detailed nature are more likely to win the hearts of buyers. I have seen buyers walk away from the shoe-box approach, just because it seems so flimflam.
But, in either approach, questions will follow. Sellers should be prepared, not resentful (its is the broker and buyer’s job) and determine, with the broker’s assistance, when it is appropriate to give detail and when not.
