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why do I need a non disclosure statement for someone interested in my business that is for sale

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Answers (3)
Satish Patel
Sunbelt Business Advisors
Middlesex County, MA
Premium Broker

Cathy,
A Non Disclosure Agreement serves several purposes but the most important is that it ensures a prospective buyer does not disclose the name or confidential information to anyone about the sale since it could be harmful to your business. Imagine if customers, competitors and employees found out you were for sale…they may exercise different judgment about their purchases from your company or your staff may begin looking for new jobs, or worst off your competitors may spread the word to vendors and customers that you are going out of business. If you’re seriously considering selling your business you should speak with a business broker who can guide you through the process and protect your interests. Please contact me at mandoni@sunbeltne.com or by phone at 617-945-5338 to learn more about the steps to selling a business and how a broker can assist you throughout the transaction.

Mariola
Senior Business Broker
www.sunbeltne.com

Aug 5, 2009
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The BAF Group LLC
MD

The normal NDA stipulates that the prospective Buyer will not share your Company's private information - such as Tax Returns and Profit information - with anyone other than his/her specific counselors, who may be employed to make a buying decision. It would also make certain that the Buyer does not contact your customers, suppliers, employees and others, reasoning that by letting any of those groups know that the business is for sale could hurt your business. Finally, it would also say that the Buyer will not use any information he receives from you to in order to compete against you.

Whether any of this matters to you depends upon your particular business. But the Agreement is there to protect your interests, the issues that could or would lower the price and salability of the business, and the of the eventual Buyer.

Jul 29, 2009
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There are a few reasons. The first is sellers usually don't want their employees to find out the business is being sold. So they won't panic and try to find another job. Or many other problems won't arise.
Another reason is so competitors don't find out and try to take advantage of employees,clients,market share,etc. Also you need to protect financial information,customers,intellectual property,etc from being leaked to your competition or the public. But if you're not worried about any of that then you probably won't need a non-disclosure.

Jul 29, 2009