First time buying a business – the confidentiality agreement
If you are buying your first business it can be daunting not knowing what information you should receive, questions you need to ask and how you get to the end game of buying the business. Brindabella Business Brokers deals with many first time business buyers and whilst we act for the seller, we know the business sale will not occur unless we provide as much guidance as possible to the buyer stepping through the buying process.
Brindabella Business Brokers encourages our clients who are selling to provide as much information up front in our information packages. This allows business buyers to gain a good understanding of the business and make a decision if they want to proceed forward. For buyers to see this information, Step 1 – a confidentiality agreement is completed.
It might be obvious but a confidentiality agreement is a legal contract. By entering into it you are agreeing to keep the information provided secret. To protect yourself, if you have business partners, friends or other business associates who you want to discuss the business with, it is best they also complete a confidentiality agreement.
This first step demonstrates to the broker you are taking the process seriously and do have an interest in buying a business. From time to time we receive contact from potential buyers who just want the name of the business or further details without completing the confidentiality agreement. If a confidentiality agreement is not completed, no further information can be provided and demonstrates to us the potential buyer is not serious about buying the business.
It is a big decision for a business seller to disclose personal information about their business and their livelihood. The confidentiality agreement helps the business seller feel more comfortable in providing the details to the business buyer and taking this first step starts the buying process on a healthy footing. Both parties demonstrate their seriousness in selling and buying the business and both give and take in order to do this. Although the first time buying and selling a business can be daunting, it can be made much easier using a qualified, experienced business broker.