Once you have decided that it is time to sell your business, you have to make an important choice and decide between selling your business by yourself and hiring someone to do it for you. While it is possible to do it by yourself, but it is not wise. The time commitments and experience that is required to make this happen might emerge as two of the most rudimentary challenges. However, finding the right broker is a strenuous process as well. Let’s help you out with some questions that’ll help you make this decision.
1. What kind of an experience do you have in selling my kind of business?
Look for a business who has had some experience selling a business that falls at least broadly in the same category as yours. Consider the differences in the business models of an app and a hair salon and consider how different the targeted buyers are going to be and you will understand why relevant experience is important. A broker is not acquainted with the workings of your business will end up spending precious time understanding it and draw out the whole process.
2. What is the valuation process you employ?
The broker’s response to this question will help you gauge the broker’s expertise. If they respond with a generic formula for valuation you need to move on. The process of valuation is entirely different for each business and quite complex at that.
3. In what ways would you maintain confidentiality?
For the sale of your business to tip in your favour, it is of great importance to keep the whole thing under wraps. Make sure that the broker has a good set of policies in place to maintain confidentiality of the sale.
4. Would you list my business for a million dollars?
It is in the interest of the broker to make sure that the sale of your business goes through. Hence, if you ask the broker to put your business on sale for an unrealistic tag and they agree, it speaks of their ineptitude and lack of experience. Listing your business on a realistic price will bear better and quicker results and a good broker would know!
5. Would you provide support for preparing sales contract or would I need to hire an attorney?
An experienced broker would have the expertise to help you draw up a sales contract, but a good one would still suggest you hire a legal team still. A good broker might draw up the initial paperwork, but a responsible one would have it reviewed by a legal team.