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How Do I Work with A Business Broker?

Posted by Justin Harris in Articles

Whether you are contemplating buying a business or selling your own, you probably want to engage a broker to assist you through this process. Trying to sell a business without the support of an experienced business broker can lead you to feel frustrated and overwhelmed. This is why, increasingly, people with established businesses are turning to dedicated business brokers who have a good lay of the landscape and are knowledgeable about the different types of prospective buyers on the market.

Finding the Right Broker for You

Not all business brokers are one and the same, however, which means that it pays to do your research and to be knowledgeable about the process itself. Scheduling an initial phone call with a business broker can give you a good idea of the overview process and what you might expect as you decide to work together. Bear in mind that business brokers are slightly different from real estate brokers. Business brokers tend to be paid by the seller.

What Does a Broker Do?

An experienced broker can play a key role in helping you to narrow down the types of businesses that meet your criteria. As a seller, however, a business broker also plays the key role of assisting you with the streamlining of selling your company.

Given that selling your business is probably a very personal decision and one of the biggest ones you’ll ever make, it’s important to understand that you need to do your research of working with a broker.

Financials should not be the only qualifier for selecting a broker. Make sure that you identify someone who has a strong track record and plenty of testimonials. Make sure upfront that you are clear about what fees, if any, will be involved. A seller is usually responsible for paying the broker’s fees, but you will need to understand how this works and whether this comes out of the end sale.

The broker might not have every answer available about the state of your business unless you have completed business valuation already and have given them a clear overview of what details they can provide to prospective buyers.

After interviewing brokers, you need to learn their qualifications by asking whether they work full time or part time, how long they have worked as a business broker, whether or not they maintain a real estate license, which is not always necessary, and whether or not they are certified.

A good web presence is another way to evaluate how serious a broker is about operating their business. Their website presence should also include reviews and testimonials from past clients, which can give you a great perspective on how involved they are in the industry and the overall feeling that past clients have had in working directly with these brokers.

No matter how you choose to move forward, the support of a business broker can erase many of the greatest challenges you face in attempting to sell your business and finding a highly qualified and vetted buyer who is ready to step in and continue the growth you have already worked so hard to build.