Avoiding False Expectations for Buyers and Sellers

At Murphy Business of Northwest Georgia, we have deep respect for CPAs, attorneys, financial planners, coaches, consultants, and other professional advisors. Many of them refer clients to us and we do the same because they play unique roles in the lives of our clients. They’re smart, capable professionals, but when it comes to valuing a business or structuring a business for sale,  working with a credentialed, experienced Business Broker / M&A Advisor offers an important advantage.

Just the other day, one of our brokers was on the phone with a potential seller of a small company who had his attorney on the line to discuss the possibility of selling his business. His attorney insisted that he should be receiving 10X on his earnings, an earn out should be 10 years long, and set a whole host of other expectations surrounding the post-sale transition, calling the structure “standard”. Unfortunately, there was nothing standard about what the attorney was saying and the seller had spent the last week getting excited about these outlandish expectations that he could never realistically get on the open market.

Why Other Advisors Might Offer Advice

When your trusted CPA or advisor offers a sense of business value or deal terms, they’re often doing so based on limited experience or general benchmarks which is their professional comfort zone. That’s understandable. They care about you, and they want to give you direction. The problem is that these discussions can set false expectations so that when a buyer or seller talks with us in depth, they already have a number or a structure in mind and the reality may look quite different.

Why a Professional Business Broker / M&A Advisor Adds Critical Depth

Here’s what sets business brokers apart when it comes to valuation and deal structure:

• Proven Valuation Methodology: We use structured approaches (e.g. Market Method, multiple of SDE, and Buyer’s Test). These involve using robust databases to research comparable sales and a deep dive into the key elements that drive value in each industry.
• Real-World Deal Experience: We’ve seen countless buyer and seller expectations shift mid deal and we help manage flexibility while keeping everyone grounded in reality.
• Macro and Micro Insight: We combine industry comps, local demand, financial details, and buyer debt capacity analysis to tailor expectations to a specific business.
• Holistic Deal Strategy: From timing to confidentiality to co brokered outreach, we think through the entire deal process, not just a number on paper. The structure can be just as important as the price.

A Collaborative Mindset: Why We Encourage Early Advisor Input

Good synergy happens when other advisors and Business Broker / M&A Advisors cooperate. Your CPA might flag tax timing or financing questions. Your attorney can help screen contract structure. Your financial coach may help you clarify your transition goals. All of these insights lay a helpful foundation when done in collaboration with a Business Broker / M&A Advisor.

What Buyers & Sellers Should Know:

1. Treat early numbers as guides, not guarantees.
   If someone says, “we expect it will sell for $3M,” know that a professional valuation may validate or adjust that number by a material amount.
2. Be ready to revisit assumptions.
   Early views often depend on surface-level metrics. They may shift when deeper data analysis reveals something different (e.g. owners add-backs, normalized earnings, industry multiples).
3. Don’t narrow your thinking too soon.
   For example: if an advisor says a seller “must take 30 percent down,” understand that creative structures, earn‑outs, seller financing, and transitional consulting might allow more flexibility if a business is strong.
4. Ask: “What’s your experience in successful business transfers?”
   Unless an advisor is active in business transactions daily, they likely do not have their finger on the pulse of how deals are getting done now. The economy, interest rates, SBA rules, multiples, etc. change regularly and require full-time engagement to stay relevant.

When You Are Thinking About Selling:

• Step 1: Bring in a credentialed Business Broker / M&A Advisor who can dig into numbers, industries, buyer interest, and market conditions with a proven methodology.
• Step 2: Have all parties collaborate on your behalf to assess general goals, finances, and strategy.
• Step 3. Align expectations, refine deal structure recommendations, and commit to a shared understanding of flexibility and contingency plans.

In summary, it’s wise to involve other professional advisors early that know your finances, and goals; but valuation and deal structure are what we as Business Brokers / M&A Advisors do full-time. Our training, credentials, access to deal data, and experience in actual transactions matter so that you aren’t leaving money on the table

If someone other than a seasoned business broker gives you firm forecasts or rigid requirements early in a deal, consider them helpful context—but don’t let those comments harden your strategy before you’ve had a full evaluation.

At Murphy Business of Northwest Georgia, our goal is to help you arrive at a real, executable valuation and deal plan that’s built on data, experience, and strategic negotiation. We love collaborating with trusted advisors; when everyone brings their strengths, our clients get the best outcomes.

Are you curious how we help buyers and sellers set realistic expectations and help you get from where you are now to the closing table? Reach out for a free, confidential conversation.