As a proactive business buyer you sometimes must get as creative as you can to qualify viable business acquisition candidates. If you have your eye on a company that is of great interest to you and it is particularly challenging to get to a specific corporate decision maker, you may want to consider using referral fee's as a creative means to get that critical introduction.
Use of referral fee's in many industries is nothing new to get highly sought after introductions, but using them in a business buyer qualification process is quite unique.
Responding to a business-for-sale listing is easy for a business buyer because the business seller has made an "official" proclamation that he intends to sell his company. For companies that are not "for sale", but might be, it is imperative that the business buyer contact a senior level manager who has the authority, knowledge and potential motivation to consider a viable purchase offer. Being able to differentiate which managers within a targeted organization have the status and motivation to say "yes" to a purchase inquiry, versus most managers within the same company who naturally have other motives and reasons to always say "no"… is fundamental to securing realistic initial acquisition discussions.
How Do I Get to That Guy?
Automated phone answering systems, voice mail, administrative assistants and receptionists limit initial voice contact with senior executives. E Mails are also often deleted, or never read if the corporate receiver does not recognize the sender's name among hundreds of daily e mails they receive. Approaching senior managers in company parking lots is forbidden and trying to talk with them privately at a trade show is very challenging.
Effective use of a reward base referral technique from someone who either knows or works with your targeted corporate contact can differentiate you from all other business buyers. It may also be the best and ONLY means you have to start a merger or acquisition dialogue.
Salesman: God Bless Them!
Sales personnel, either targeted company employees, or better yet, contracted independent sales representatives; offer you the easiest channel to get that targeted company introduction.
It may be too much of a generalization to make, but sales personnel more than any other function in a company offer you, the business buyer, five traits that you can leverage to your advantage.
1) Sale types typically will talk to anyone about anything – simply contact them, ask your questions or seek their help.
2) Sales personnel are inclined to be "independent operators", even within the most disciplined of organizations; they work their own programs, when and where they want, with relatively little concern about internal politics
3) Sales people answer their phones, listen to their voice mail, read messages and return calls because they think you want to BUY something!
4) Salesman know just about everyone within every branch of the company and for various reasons have consistent exposure and often well established relationships with key corporate decision makers
5) Sales types are very motivated by money! They will especially talk to you if you can potentially do two things for them:
A) Offer them "easy money"
B) Provide another viable contact for them to potentially land a better sales position
So… How Does the Deal Go Down?
From anywhere in the country you can call into the corporate office and ask to speak to a local or regional sales representative. Once you get their number, simply call them and introduce yourself as someone who greatly admires their company and has interest in understanding who within their senior management can say "yes" to a business merger proposal (be sure to say only "merger"). Sales types understand and appreciate this inquiry process because they live it everyday. You have a person on the other end of the phone who is naturally motivated to help you. More often than not, all you got to do is shut up and listen to the information that flows.
If you get any form of resistance or down right rejection, remember you can always simply thank them for their time and go call another sales person. If you are hearing cooperation then, and only then, do you offer a modest referral fee arrangement. It is critical that you tell the salesman that the referral fee is standard practice for your firm and that it can either be paid to them directly, in confidence, upon eventual merger or acquisition closing, or, you'd be happy to donate the money to their favorite charity. Most will simply help you for no fee.
To conclude, the referral fee process, be sure to document the following relevant information gotten from the sales representative: The spelling of the name of the senior manager, their official title, confirmation that this manager is the best contact within the company, a clear understanding of their relationship with that senior manager (if weak, try another sales person) and their OK that you can use their name to get the senior manager to talk with you.
Remember, you really only have one shot to get to that senior manager, so if you think you need to contact two or three salesman to validate who really is the key manager to call about mergers and acquisition inquiries and who of the three salesman has the best relationship with that senior manager than it is in your best interest to do so.
Getting to difficult-to-contact executives about acquisition interests often has to be a premeditated, systematic, creative process. Like in any selling situation, getting to the "right" decision maker dramatically increases the probability of sales success. Incorporate this technique into your company acquisition qualification process.
About the Author:
Mark Smock is President of http://www.business-buyer-directory.com, the FIRST international business buyer directory of its kind. Business Buyer Directory provides a non-traditional means for proactive business buyers to locate businesses for sale worldwide that meet their exact registered purchase criteria
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