Death of Common Sense

Posted: November 2nd, 2009 | Author: | Filed under: Small Business Topics | No Comments »

I blogged (fairly) recently about the death of good ‘ol common sense, but a recent transaction I was involved in reinforced my (sometimes) jaundiced view of humans’ ability to interact with one another using plain common sense.

We had a willing buyer and willing seller.  We had a price.  We identified who was buying what and how payment was to be made.  So the parties had it all pretty much figured out.

Six weeks later, the parties walked away from the deal in abject frustration, considerably poorer as a result.  What happened? 

The buyer wanted to use a standard purchase form that covered a multitude of risks and scenarios that in often simply bore no relation to the business that was being acquired.  This left the seller in the position of trying to convince the buyer that the standard form was inapplicable in many cases, which in turn prompted further investigative questions by the buyer to parse out the seller’s objections.  Rather than working with a document that was tailored specifically to the agreed terms, the standard form approach left the seller frustrated, often mystified, and put to the cost of needlessly trying to convince the buyer that one of the remote risks identified in the standard form was simply not applicable. This led to the buyer becoming increasingly suspicious, trust rapidly eroded and the deal died.

The real tragedy was that it didn’t have to be that way.  This was a classic case in my view of trying to commoditize a transaction; and it highlights the pitfalls of the one-size-fits-all approach.  Had the parties brought some plain common sense to bear, I believe this outcome could have been avoided.

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