5 Benefits of Using a Business Broker
Have you been trying to sell your business for a while or are looking to sell your business? One of the wisest things you can do is hire a business broker. Selecting a quality broker will allow you to maximize the sale price of your business. In addition, a quality broker will help you find a reputable buyer while walking both parties through the sales process. Below are five benefits of using a broker to sell your business.
Peak Business Valuation works with business brokers frequently. We are happy to give you a recommendation. Reach out by scheduling a free consultation.
1. Confidentiality
A quality broker will maintain high levels of confidentiality. Business owners often do not wish their employees, customers, or suppliers to know they are considering selling. Brokers maintain confidentiality by screening prospects, phasing the release of information, and only giving information to prospective buyers who qualify. Every business they sell is a confidential transaction and they will do everything they can to protect the identity of the company. A broker working on your behalf allows you to remain anonymous and is the best way to ensure confidentiality.
2. Valuation Expertise
A broker who has merger and acquisition experience understands the market. They also have access to recent sales statistics and know how to use various methodologies to guide you to a fair market value. Fair market value is what a willing buyer will pay and a willing seller will sell.
Valuing a business can be very difficult and complex. Businesses have several variables that can impact the value. A quality broker will know a fair market value range for your business and may work with a local valuation expert such as Peak Business Valuation to assist in the process.
Many business owners overprice their business. As a result, many small businesses take a long time to sell or never sell at all. Pricing your business strategically will help you sell quicker.
3. Marketing
Selling your business is all about marketing. Presenting your company in the best light will maximize the sale price. Since this is a commission-based industry there are many good brokers and many useless ones. An experienced broker will do more than just list and wait for inquiries. This takes a matter of minutes for anyone to do.
A quality broker will have an extensive marketing program to give your business maximum exposure. This may include print ads, internet marketing, direct mailers, and database marketing. A comprehensive marketing plan is far more effective than a business owner could manage on their own.
The broker needs to understand the key values buyers are looking for and can assist in identifying changes that can lead to a better selling price. A broker can properly position the sale of your company to attract and motivate as many buyers as possible.
Initially, a quality broker will discuss your goals and reasons for selling and will learn all about your business. Ensure your broker has a comprehensive marketing plan and specific details for advertising strategies. Don’t be afraid to give them information about your business to help in the sale. In addition, ask plenty of questions about the steps they will take to sell your business.
4. Negotiation
As a professional negotiator, a broker knows how to overcome obstacles that prevent a sale from closing. A quality broker doesn’t fall prey to personal emotions and can leverage their experience to help you receive the best possible price and terms for your company.
They are a vital adviser to the seller at any stage of the sale, from the early stages to the final contract. A third party can help make sure deadlines are met as time is of the essence. This is often where the broker pays off.
5. Resources
Business brokers have many tools and resources available to help them reach the largest possible base of buyers. The larger the pool, the better the chance of receiving a good price and terms, as well as a buyer who is fit for your company. Brokers can help screen unqualified candidates and select qualified candidates who are financially and operationally capable of running the business.
Working with a quality business broker will take some of the work of selling off your hands. This will allow you to continue to run your business and make sure it remains profitable until the time of sale.
We at Peak Business Valuation have dozens of connections with brokers across the country. In many instances, we provide valuation services to assist the broker to arrive at a fair market value. However, we most often work with buyers of companies who are looking for a second opinion on the value of a business for sale. We welcome any questions you have. Please reach out by scheduling a free consultation.
Be sure to also check out Finding a Quality Business Broker.
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