Strategies for Finding the Best Business Broker for the Job
Similar to real estate agents, brokers act as matchmakers who connect you to the right buyer for your business.
Many years of persistent hard work have brought you to the point where you’re finally ready to sell your business. But finding buyers can prove difficult, especially if you’re not in a hot niche. A business broker streamlines the process and opens access to a bigger pool of well-qualified buyers. Similar to real estate agents, brokers act as matchmakers who connect you to the right buyer for your business. Their expertise can garner the highest possible price and make the process faster and less stressful.
These strategies can help you get the most value by finding the best possible broker for your business:
Do Your Own Due Diligence
The buyer will be researching you. Research them. Due diligence can help you assess the buyer’s experience, credentials, and background. Check the Better Business Bureau website and the buyer’s online reputation. Ask whether the buyer has purchased this type of business before. Assess whether they are financially able to invest, or just engaged in wishful thinking.
If the sale leaks too early, competitors will circle like sharks. You may lose key team members and suppliers. Do not tell anyone the business is on the market until you’re ready to move forward with your broker. Then craft a comprehensive communication plan that progressively unveils details of the sale. Your broker should also help with a non-disclosure agreement for potential buyers. This protect you from competitors who pretend to be interested only so they can poach trade secrets. The right broker will also know how to balance marketing your business and protecting confidentiality.
Be Skeptical of Upfront Fees
Most brokers charge success fees of 10 to 15 percent of the total sale price. Be skeptical of brokers who want significant upfront fees, especially just for doing a valuation. Each broker should be able to explain their fee structure and individual process. So if the broker can’t justify the fees, move on.
Get Clear Details About the Marketing Plan
The primary benefit of hiring a business broker is that they devise a marketing plan that can help attract interested buyers, create a competitive bidding environment, and then motivate buyers to complete the sale at the highest price and most favorable terms.
The best brokers should have significant experience with your niche and with businesses similar to yours. They should walk you through the sale process, and tell you how they manage common challenges. You must have a high degree of confidence in their sales ability, since you’re heavily investing in it.
It’s equally important to work with someone you trust and like. You’ll be working closely with this person, and they will be the face of your business to buyers. So ask important questions, and assess the broker’s personality. Don’t hire anyone who is resistant to answering your queries, unpleasant, or rude. You must feel excited to work with this person, not anxious about whether it will work out. So continue the search until you have found the perfect match.