Why do Sellers of Businesses require an NDA signed?
The (NDA) Non-disclosure/confidentiality Agreement is one of the more critical documents that Sellers and Brokers use to keep propriatary information, location and name of a business confidential so that the possibility of the sale of the business does not cause undue alarm among the employees, suppliers and or clients. Premature disclosure has caused businesses to lose employeess, cause suppliers to go to “cash only” upon delivery and clients to “jump ship” and go to the businesses’ competition…..and believe me, when the competition gets wind of their competitors possible sale, they move in like vulchurs. Any Business Broker that doesn’t require the NDA be signed before the distribution of data, name and location is in violation of their Code of Ethics as well as their duty to their Client, the Seller. Ladd McGowan-CBI, Senior Business Analyst