I usually qualify a seller before I go out and meet with them. I ask the seller some questions to make sure they understand that I only take exclusive listings, so neither of us end up wasting our time. Once in a while, and more often earlier in my career, a seller will tell me, "I don't want to do an exclusive listing, only open listing, because maybe Iíll be able to sell it myself." I never try to "hard sell" them or make the potential seller feel like they are wrong, because I was once a retail business owner, and so I can understand where they are coming from. I have sold hundreds of businesses and a seller may have only been involved in 2-3 transactions, if that, and so aside from saving money on commission, they may not know of the pitfalls that come along with that. I've learned that if you treat the potential seller with respect, and they do try selling it themselves, and it doesn't work out, they will come back to you when they do end up listing it for sell.
Obviously, saving money on the commission is the number one reason why most sellers end up trying to sell it themselves. Who doesn't want to walk away with more money in their pocket? It's understandable.
One of the benefits of selling the business yourself is that you are not obligated to be with one business broker for a term of up to six months. There is no intermediary, and so you can sell the business, in your own words, to every potential buyer and explain why they should by it.
If you are selling yourself, you donít have to give up the reigns to someone you donít know. An owner who sells it themselves, knows exactly the type of marketing being used, who inquired about their business, and directly what is the reaction to the market their business has.
Many of the listings in my inventory feed off themselves, as an example, they come in looking at a 5-day coffee shop, realize itís not for them, and end up looking at a deli.
This may be why many opt to list with a broker rather than sell it themselves. It's sad, but true, that many businesses for sell do not end up selling, and so itís important to have as few key people as possible know itís on the auction block. Meeting with buyers off site is essential, because an owner doesnít want someone coming into their business and saying, "hey is this the place to sale?" in front of employees and customers.
Getting The Deal Closed
I could say limiting liability, because the broker has all the correct forms and knows the timeline in which they are executed, but I find the greatest benefit a broker has in a transaction is solving problems that occur throughout the transaction. The broker often acts as the driving force during the transaction and keeps things moving, because the longer a transaction takes, the more likely the deal doesn't get done.