How to Handle Unsolicited Bids: Your Complete Guide
An unsolicited bid is a situation in which a company or person offers to buy you out without any prior negotiations or agreements.
These bids are also called hostile takeovers, and you’ll need to know as much as you can about it to decide how you want to proceed. While they’re known as hostile takeovers, they can actually be a sweet opportunity, depending on the offer.
However, some companies take these bids as a chance to stick another business with a bad deal. To learn where you stand and what you should know about handling these bids, read the points below.
#1: Understand Exactly What an Unsolicited Proposal Entails and What It Means for Your Business
If you’re planning to address an unsolicited bid, the best thing you can do is create a gameplan. This starts by knowing every last detail of the bid so you can make the decision that’s best for you.
By looking into the offering price and comparing it with the value of your company and the state of the market, you’ll be able to figure out whether you’d like to fight it or strike a deal.
Your current circumstances dictate a lot about what decision you’ll make, so make the details as plain as possible, as early as you can.
#2: Assess the Pros and Cons of the Bid
Talk to your accountant team so they can help you weigh the pros and cons of whatever bid you’re receiving. While your initial response might be to balk at an unsolicited bid, it can actually pose an opportunity.
For instance, if you’ve already been thinking of getting out of the business, unloading assets, or shifting gears, you might want to give it serious consideration.
#3: Talk to Your Lawyer
Touch base with a business attorney who can assist you whenever you need to consider the decision. By talking to a business lawyer, they’ll allow you to weigh every last detail, while also reading through the language of the contract.
When you’re offered a proposal, you’ll have a specific turnaround time for response. After talking to your business attorney, you’ll have the chance to respond from a position of strength, no matter what decision you make.
Hiring a business lawyer can be arranged by the hour, for a flat fee, on a contingency basis, and other agreements.
You might be able to hire these pros on retainer also if you know that you’ll be using their services on a regular basis.
#4: Be Careful With the Way You Communicate and Consider Who You Can Trust
If you’re receiving unsolicited bids, there’s a chance you have some leaks within your company or inner circle. This means that you need to be mindful of how you’re communicating internally and who you are sharing information with.
You don’t want to give the bidder any more intel, as it’ll weaken your negotiation ability.
#5: Uphold Your Company’s Standards and Morale
While you’re dealing with an unsolicited bid, you’ll still need to set the tone for your company’s culture and morale. Rumors start to fly when someone makes an offer on your business, and you’ll want to keep your workforce out of panic mode.
More importantly, don’t let your standards or ethics slip during this time of potential uncertainty. Maintain your focus on making it the best workplace possible for your professionals, as you also handle business by responding to the bid.
Address the Unsolicited Bid
Getting an unsolicited bid can be potentially unnerving, so it’s crucial that you handle it properly. By following the tips above, you’ll be better able to address the bid in a way that makes sense for you.
Take the time to contact us online by using the form or pick up the phone and call us at (713)622-4300.