One of the less common areas in the business brokerage industry is the idea of growing a business by corporate acquisition, in essence buying a competitor. Many business owners have thought of this – but few will complete an acquisition. Why? Often it is the difference between proactive and reactive buyers. Let’s look at the differences between reactive and proactive approaches to buying a business.

A reactive buyer is one who waits and hopes a good acquisition opportunity will come along at the right time. The buyer may actively search listings of businesses for sale, yet even this is reactive as they are only looking at businesses who have already decided to sell. Alternatively, they could approach a business intermediary and say: “If you come across something I might be interested in let me know and I
will take a look at it.” There are good business intermediaries who do keep an ear to the ground for his potential buyer, those are hardly inspirational words! Bear in mind that such a business intermediary will likely need to have the buyer’s industry as a specialty niche, one who knows the majority of businesses in the appropriate geographic area and understands the industry business parameters. This buyer’s approach is virtually the definition of reactive! The buyer is waiting for the phone to ring. Is that the way their sales team brings in new customers?