If you decide to sell your small business, you may be wondering if you should retain the services of a business broker to facilitate your sale. After all, you will no doubt be preoccupied with a variety of other considerations when you’re planning your exit strategy. The last thing you want to do is address inquiries from strangers who seek to buy your business.
Once you decide to go the route of selling your business yourself, your listing is considered an FSBO, or a “for sale by owner.” Business owners may choose this option for several reasons. You may not be able to find a competent broker in your area who you trust to sell your business. Or, you may balk at the commission fee a business broker claims upon the sale of your business, which is typically around 10 percent of the purchase price.
Typically, the good outweighs the bad, however, when it comes to business brokers. A business broker can help alleviate the stress involved in appraising your business, offering it for sale on online platforms, writing ad copy, and vetting potential buyers. Usually, business brokers have extensive experience in business that allows them to offer insight into prospecting and marketing. They are professional intermediaries who connect you with qualified buyers.
You may choose to retain the services of a business broker if you don’t have anyone lined up who is willing to buy your business from you. Occasionally, a seller plans to sell his or her business to a family member, a key employee, or a friend who also works in the industry. If you don’t have anyone to sell your business to, a business broker can put you in touch with qualified buyers who have experience in your industry. They also handle the organizational aspects of putting together a listing, managing documents, writing business teasers, and meeting challenges as they arise. Because they are skilled at negotiation, they may achieve a high final purchase price that compensates you for their commission, and then some.
In addition, business brokers can avail you of a vast pool of buyers. They spend their days staying in contact with buyers and sellers, and they amass a large database of potential buyers who stay in the wings until the right business comes along. If you reach out to a business broker, he or she will no doubt tell you that there is someone available to buy your business from the get-go, which can be extraordinarily convenient for you, the seller. You, meanwhile, can focus on the day-to-day operations of your business, ensuring that profits remain intact and that the value of the business does not decrease while you content with the difficulties involved in transitioning.
Moreover, business brokers are usually part of a larger operation. They work under the direction of a managing broker, who oversees an office of multiple business brokers. Such a setup is designed for collaboration. Your business broker will advertise your business not only to prospective buyers but also to his or her colleagues, who may have buyers of their own. Their ability to pool all available resources in their office is what will make them, and you, successful in the long run.
Where can you find a good business broker? Search BizBuySell.com’s Broker Directory or BusinessBroker.net to find a qualified professional in your area. Though you will, no doubt, need to interview one or more brokers before finding a good fit, you may find that the advantages of retaining the services of a business broker far outweigh the disadvantages.