- Choice. Do not rush to make your choice. Take the time to talk to a few brokers to get an idea of how they work and how much they charge. All good brokers will happily provide you with a free initial consultation with no obligation or for a nominal fee. And get at least three offers.
Industry experience. Choose a broker that has proven experience in your industry. Some brokers specialize in specific markets or sectors. It doesn’t make sense to sell your restaurant through a broker specializing in selling nursing homes. Ask about their contact database as well as their technical expertise.- Recommendations. Ask to see recommendations and reviews from named customers. If possible, talk to previous customers to see what they thought.
- Credentials. Check what credentials the broker has. Some of them may be members of the International Business Brokers Association, which at least ensures that they act by a professional code of conduct.
- Marketing strategy. Ask about their methodology for marketing your business and ask to see samples of printed literature and sales details for other companies. Good brokers should offer a customized marketing strategy – your business should stand out.
- Experience. Be sure who will act on your behalf. It would help if you were sure you have an experienced broker as your only point of contact, someone who won’t spend your time on on-the-job training.
- Personality. Ensure that the broker you will work with is liked, personable, and you can trust. Selling a business can be time-consuming, taking an average of 6 months to 2 years. You must have a positive working relationship and feel that the broker understands your position and has the same level of motivation to reach a deal as you do.
- Communication. If you want to close a deal as quickly as possible, choose a responsive broker, a good communicator, and someone willing to be available after hours when needed.
- Valuation. Don’t choose a broker who gives your business value that seems too good. It’s hard not to feel flattered when someone places great importance on the product of your blood, sweat, and tears. Marketing your business at an unrealistic price risk alienating potential buyers and can increase exposure to the market for a long period. Every assessment given to you by a broker should be based on facts.
- Fees. Make sure you have written confirmation of what and how the broker’s fees will be charged, and double-check the fine print. Although brokers usually charge an initial advance, it should be minimal. Ensure that most fees are sales-based and are calculated as a percentage of the final sale price.
- Professional Recommendation. If you have already appointed a specialized business attorney, they will likely be able to recommend a good business broker. This has the dual benefits of having the confidence of a broker recommended by a professional you trust, and you also reap the benefits of working with a team that has worked successfully together on previous trades and who shares the same values.
- Questions! And finally, expect questions! A good broker will want to know as much about you, your business, and your goals as you do about them. They should show genuine interest in your transaction and express passion for what they do.
Broker Services
Brokers connect buyers and sellers, facilitating deals across markets and earning commission-based revenue.