{"id":86,"date":"2025-12-02T16:05:27","date_gmt":"2025-12-02T16:05:27","guid":{"rendered":"https:\/\/www.herringbonedigital.com\/blog\/?p=86"},"modified":"2025-12-02T16:07:21","modified_gmt":"2025-12-02T16:07:21","slug":"post-11-of-24-common-negotiation-traps-and-how-to-avoid-them","status":"publish","type":"post","link":"https:\/\/www.herringbonedigital.com\/blog\/2025\/12\/02\/post-11-of-24-common-negotiation-traps-and-how-to-avoid-them\/","title":{"rendered":"Post #11 of 24 \u2013 Common Negotiation Traps (and How to Avoid Them)"},"content":{"rendered":"\n

Let\u2019s talk about one of the most misunderstood (and emotionally charged) parts of any deal: negotiation.<\/strong><\/p>\n\n\n\n

Most agency owners approach a negotiation thinking it\u2019s all about one number \u2014 the price.<\/em>
<\/em> But that\u2019s exactly where most sellers go wrong.<\/p>\n\n\n\n

In reality, the purchase price is just one part of the deal. The structure<\/em> \u2014 how that price is paid, under what terms, and with what obligations \u2014 often matters far more.<\/p>\n\n\n\n

Here are a few common traps<\/strong> I see sellers fall into again and again:<\/p>\n\n\n\n

1\ufe0f\u20e3 Focusing only on the headline number.<\/strong><\/h5>\n\n\n\n

A $10M offer sounds better than $8M\u2026 until you realize $4M of it is an earnout tied to performance metrics you don\u2019t control.
Always ask: What\u2019s guaranteed vs. what\u2019s contingent?<\/em>
<\/em>A lower price with cleaner terms often beats a higher price full of conditions.<\/p>\n\n\n\n

2\ufe0f\u20e3 Assuming the first LOI is final.<\/strong><\/h5>\n\n\n\n

The LOI (Letter of Intent) feels like a finish line \u2014 but it\u2019s actually the starting line.
Everything that follows \u2014 due diligence, final agreements, working capital adjustments \u2014 can change the economics of the deal.
Smart sellers keep some flexibility and don\u2019t emotionally \u201cbank\u201d the LOI number too early.<\/p>\n\n\n\n

3\ufe0f\u20e3 Ignoring working capital.<\/strong><\/h5>\n\n\n\n

This one surprises a lot of founders.
Buyers expect a certain amount of working capital (cash, AR, prepaid expenses) to remain in the business at closing. If you haven\u2019t planned for that, it can reduce your actual cash proceeds by hundreds of thousands.
Don\u2019t find that out the week before closing.<\/p>\n\n\n\n

4\ufe0f\u20e3 Negotiating emotionally.<\/strong><\/h5>\n\n\n\n

Selling your agency is personal \u2014 you built it. But emotion clouds judgment.
I\u2019ve seen founders walk away from great offers because they felt \u201cdisrespected,\u201d and others accept poor deals because they just wanted it over with.
Take a breath, get advice, and remember: this is a business transaction.<\/strong><\/p>\n\n\n\n

5\ufe0f\u20e3 Not understanding post-closing obligations.<\/strong><\/h4>\n\n\n\n

Non-competes, transition periods, consulting agreements \u2014 these can all shape what your life looks like after closing.
Don\u2019t just focus on the check. Think about what you\u2019ll actually be doing 3, 6, 12 months later.<\/p>\n\n\n\n

Here\u2019s my advice: don\u2019t negotiate to win \u2014 negotiate to align.<\/strong>
<\/strong>Because when alignment is strong, both sides walk away happy, and the business you built continues to thrive.<\/p>\n\n\n\n

Contact us <\/a>if you\u2019re and agency owner and have considered selling or joining something bigger.<\/em><\/strong><\/p>\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

Let\u2019s talk about one of the most misunderstood (and emotionally charged) parts of any deal: negotiation. Most agency owners approach a negotiation thinking it\u2019s all about one number \u2014 the price. But that\u2019s exactly where most sellers go wrong. In reality, the purchase price is just one part of the deal. The structure \u2014 how […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-86","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"yoast_head":"\nPost #11 of 24 \u2013 Common Negotiation Traps (and How to Avoid Them) - Herringbone Digital Blog<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.herringbonedigital.com\/blog\/2025\/12\/02\/post-11-of-24-common-negotiation-traps-and-how-to-avoid-them\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Post #11 of 24 \u2013 Common Negotiation Traps (and How to Avoid Them) - Herringbone Digital Blog\" \/>\n<meta name=\"twitter:description\" content=\"Let\u2019s talk about one of the most misunderstood (and emotionally charged) parts of any deal: negotiation. 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