Although not officially a syndrome, it should be. Every day I meet buyers looking for their dream business who are frustrated that it hasn’t come along. Stranger yet, it’s this group of people that spend two to three years trying to find their perfect piece of Australia only to end up buying usually the worst possible business. Yes that’s right, frustration can often lead you to madness.
Sound familiar? Scouring through pages of internet listings, receiving email upon email with business memorandums that don’t stack up, endless calls to brokers only not to be returned. The list goes on of things that buyers endure whilst searching for a business. Once you’ve past the six month point things begin to change. The businesses you view start getting worse and by the twelve and eighteen month point, every business you come across doesn’t suit and even if it did it wouldn’t stack up.
There is one common denominator in this situation, and that’s you. I hate to be blunt but it’s vital you understand this. Every business has its floors and no business owner sells the perfect business, therefore buying one is impossible. What you need to know is that a seven out of ten is a buy, anything below is a pass. But it’s the actual measurement of each opportunity logically that most buyers never get. Most buyers, particularly those who end up buying the wrong business, ride on emotion rather than reason.
If I got a dollar for every time I met a business owner who bought a business out of frustration and lost a bundle on it I would be rich beyond Branson. Every day I meet people who don’t act reasonably and rationally and spent years searching only to find themselves buying the absolute wrong business. Worst yet, they always seem to loose substantial amounts on it.
So why does this happen. Simple, a lack of guiding principals. See most buyers rely on gut instinct, not that there’s anything wrong with this, however unless you have a series of guiding principles as to why and what you are buying then you are emotionally judging a business. This being the case if your emotions go haywire then you’ll act accordingly.
Here’s the takeaway value. Accept the perfect business doesn’t exist. Don’t judge businesses emotionally, use a metrics or guiding principle, criteria, something logical to analyse your purchase. And don’t be arrogant. Don’t judge a business owner or their business if you haven’t been in that particular business yourself. Sounds bizarre to even mention this but I see good people (buyers) make judgment out of arrogance without really analysing the opportunity rationally. Buying a business is no place for emotions so get logical people.