February 24, 2020

Is It Ethical to Sell Your Business to a Buyer You Believe Will Fail?

A seller had to consider if it was ethical to sell their motorcycle dealership business to a buyer that was well qualified financially, but had some personality issues that raised concerns about the buyer’s ability to successfully run the business over the long term.

Transactions where the sellers, who were independently wealthy, weren’t all that concerned with the eventual sales price and priced their businesses aggressively to sell. One sold, with a deep discount and the other didn’t.

Finally, a seller sold at the right time and didn’t try to milk the strong reoccurring revenue and cash flow from the business. This turned out to be a good decision, because shortly after the business was sold, the market changed.

Greg Carpenter
M&A Business Advisors
San Jose, California
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