How to Counter Offer a Counter Offer for the Purchase of a Business
A counter offer is a rejection of a previous offer and submission of a simultaneous updated proposal. It is a common step in the establishment of a contract. One case where you'll likely field a counter offer is when attempting to purchase a business. If the seller sends you a counter offer you have the option of rejecting that offer and sending yet another counter offer in response.
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Instructions
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Review the full terms of the counter offer from the seller to identify specific points with which you disagree. Take your time to determine what items are "must-haves" and which are negotiable on your end. As author Richard Parker of The Business For Sale Buyer Resource Center points out, this is an emotional time for a business seller -- you should be sensitive to his needs but not at the expense of your own needs as the buyer.
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List the various points of concern in order of importance with the negotiable points last. For instance, if the seller refuses to provide you with his full list of contacts but you need that information to successfully take over the company, that is a must-have at the top of the list. If the seller does not want to agree to transfer his office building lease even though it will add costs on your end to find another location, you might add that as a negotiating point lower on the list. Evaluate both the short and long term consequences of agreeing to each questionable term proposed by the seller. Involve your accountants, principals and lawyers in the evaluation process.
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Narrow down the points to the ones you absolutely must modify in your counteroffer. Find a middle ground between what you want and what the seller wants on those points. For instance, in the case of getting the seller's client list you might negotiate to receive 75 percent of the list names instead of 100 percent.
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Modify the terms of your initial offer -- the one that preceded the counter offer -- to reflect your compromise with the seller. Express that while you cannot accept the previous counter offer, you would like to present a new counter offer for review. Forward the letter via your lawyers or buyer's agent.
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