Finding the best business broker is a major step in selling your company. A quality individual will help you maximize the sale of your business and smoothly walk you through the process. But ultimately, it is up to the business owner to sell the business. As the business owner, there is no better individual to tell your business’ story to prospective buyers. However, by having a quality intermediary you can focus on running your business while it is on the market. So, how do you go about finding a quality business broker? Here are four qualities to look for in a potential broker.
Peak Business Valuation works with business brokers daily. We are happy to give you recommendations. Reach out by scheduling a free consultation.
Experience
Select an individual who is seasoned in the ropes. Ideally, the individual is full-time at a reputable firm. Selling a small business isn’t a task to entrust to someone with limited time and resources. This individual should have in-depth knowledge of the industry as well as the necessary training and certifications. Many brokers are members of the International Business Brokers Association and have a Certified Business Intermediary (CBI) designation.
An extra benefit of working with an experienced and networked broker is that they may already have a large pool of potential buyers ready and waiting for new opportunities. Lastly, a quality broker will know the procedures and necessary forms to protect you during the process. An experienced business broker is invaluable when selling or buying a business.
Connection
While hiring a broker is a business engagement, it will be much smoother if someone you like and trust handles the sale. A broker should thoroughly explain the process and understand your business. We recommend meeting with several business brokers. Effective ones will take the time to learn about your business and ask good questions. They will also have a good grasp of the market and compile a reasonable valuation. Most importantly, they will set realistic expectations.
Dependable
When selling a business, there is no time for a stop-and-go. You will want to find someone whom others see as dependable. Look for someone who has solid relationships with law firms, accountants, bankers, or others in the legal and financial space. Gaining referrals in your local area doesn’t take long and will aid in getting the best broker. Hearing first-hand experiences will give you insight into the background, character, and reputation of the business broker. This will help narrow your search in finding a dependable business broker.
Equitable
Lastly, an equitable broker will be forthright with their fees and what they agree to deliver. Most reputable brokers charge a fee for their services that ranges from 10-15% of the sale price. Beware of huge upfront fees, as there may be other motives to help sell your business that are not aligned with your goals. Take a careful look at the terms and conditions of any agreement you are entering into. A few things to note include: the duration of the commitment, cancellation rights, additional fees, and obligations of each party.
Buying or selling a business can be stressful. Choosing a quality adviser to help you through the steps is key to a successful transaction. From start to close, it is important to understand what your business broker will do for you. You should know the costs associated with hiring a broker. As well as conduct a careful evaluation of their track record and success.
Peak Business Valuation has dozens of connections with brokers across the country. In many instances, we provide valuation services to assist the broker in arriving at a fair market value. We 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.
