Many industries use licenses and professional certifications as a way to ensure that all people working in the profession are on the same page and agree to a set of similar principles.
However, there are challenges inside the business broker industry because not every business broker you meet offering to sell your company has the same experience or approach. Business brokerage is, in fact, an unlicensed profession. In most states throughout the country, you do not need to have a license in order to sell a company.
This means that since licensing is not required so often, that there are a few regulations around selling a business. This can be problematic for business owners who are about to engage with the services of a business broker and have one of their most important assets, their company, on the line. With so few protections available for business sellers or buyers, the selection of the right business broker becomes even more important.
One of the other confusing aspects of working with business brokers is that the 13 states that do require someone to have a license ask that the business broker holds a real estate license.
These include Arkansas, Florida, California, Illinois, Colorado, Georgia, Idaho, South Dakota, Michigan, Oregon, Minnesota, Nebraska, Nevada, Wisconsin, Wyoming, and Rhode Island. The problem is that a person who is trained to sell real estate and receives the appropriate licensure does not necessarily mean the person is trained to sell businesses.
The process of selling a business looks quite unique and since many business owners have the bulk of their personal net worth tied up in the business, the stakes are higher and it’s more important to retain an experienced business broker.
The first things to look for is to evaluate for experience. There are several factors you should consider in your hunt for a business broker including a positive reputation, the type of business, any accreditations obtained by that person and their overall marketing strategy.
Furthermore, the business broker you select should know your industry and size since no two companies are alike. Businesses that are in the same industry, such as ecommerce business or those selling on Amazon FBA will have more similarities than two unique companies.
Specialization can be a very important factor in selecting your business broker because you might be looking for someone who has a significant track record in selling Amazon FBA businesses and getting the maximum value for the owner while minimizing any potential stress. Make sure you evaluate whether or not specialization is a key feature offered by the business brokers you are thinking about working with.
Some of the factors to look for are a business broker who has sold a business of your size, someone who sells businesses in your industry regularly and is a well-known name, and someone who has sold a business in your industry recently. These factors are a key role in choosing who might be helping you with selling your business. Scheduling a consultation with an experienced and knowledgeable business broker is the first step for evaluating for these unique concerns.
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