Podcast (E9): Understanding the Seller’s Priorities

We are often asked what makes a deal successful? We decided to share our thoughts and experiences to help buyers and sellers have a more successful deal making process.

This blog is for informational purposes only. This blog is not legal advice, and no attorney – client relationship is intended or formed by this blog.  For more information or to contact an attorney at Foreman Law, please email info@goforemanlaw.com.

Understanding the Seller’s Priorities:


  • Cash Sales Price
    • The amount the seller will walk away with at closing will not always be the same as the total sales price.
  • Total Sales Price
    • Not every deal has 100% of purchase price getting paid at closing. Some may be contingent on the success of the business after the sale.
  • Legacy
    • Sometimes, the business is a critical part of the seller’s identity and their personal legacy.
  • Ongoing Business Relationships
    • Some sellers will have ongoing relationships with customers and suppliers through other businesses, and will want to manage the impact on those relationships.
  • Employment for Principal, Employees, etc.
    • The deal may be structured to provide for employment of one or more of the owners of the seller as well as key employees. The seller may want to limit involvement on their time, provide for smooth transition for key employees, or may want to protect their future earning potential.
  • Tax Planning
    • The structure of the deal can have a big impact on how much the seller actually keeps after taxes. Get your tax advisor involved early.


  • Seller Financing
    • The seller is no longer the captain of the ship, but they are still attached to the business if they have provided financing for part of the sales price.
  • Co-Owners
    • There can be added legal risks or responsibilities for the seller when co-owners are involved. Ensure that all co-owner rights, notice and approval requirements are followed.
  • Post-Closing Purchase Price
    • Any amount to be paid after closing is at some risk.
  • Tax Consequences
    • Tax laws change and that can impact any amount to be paid after closing.
  • Known/Unknown liabilities
    • Seller needs a list of liabilities early. This will help the deal move smoothly and provide as much time as possible to manage those liabilities.
  • Representations and Warranties
    • The representations and warranties that the seller provides are promises to the buyer that certain facts are true about the business. If those statements are not true, it can create liability for the buyer.
  • Indemnities
    • The seller often promises to make the buyer whole if certain things happen after closing.
  • Loss of Business Opportunities
    • Most deals have a non-compete an other restrictive covenants. The seller will often have to give up known and unknown opportunities to comply with those obligations.
  • Post-Closing Liabilities
    • Depending on the deal terms, the seller may be on the hook for some liabilities after closing.

Practical Tips:

  • Take the time to understand legacy/non-financial priorities and concerns.
  • Take time to build a relationship early: more trust = more transparency = better results.
  • Be clear about your interests and priorities…and ask for the same from the other party.
  • Think about the seller as a customer – make them happy!
  • Get key risks on the table quickly – less surprises means a better deal process.

Top Take Aways

  • Sam — Take the time to understand the non-financial priorities of the seller. These can often make the difference in a successful deal process.
  • Jacob — If you are a seller, put your buyer’s hat on and think about what a buyer would want.

Wellness Tip! Manage stress by listening to learn. Stress is increased by the unknowns. Take the time to listen and learn reduces stress by reducing the unknowns


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