Postings Advertise Resources Blog Discussions About Us Register Login BizBen Podcast   BizBen Podcast  
BizBen.com
500 New & Refreshed Posts, Postings Daily
Over 8,000 Postings & 2,500 Resources
Assisting Buyers & Sellers Over 25 Years!

Categories

Selling My Business: How Many Business Brokers Should I Interview?

How many business brokers should I interview prior to selecting one when selling my business? Choosing a business broker to sell your business can be crucial to the success of it selling. A broker who you have an exclusive listing agreement with, which I recommend vs. open listing, will essentially be your partner during the listing term in getting your business sold. How many you interview is entirely up to you, but my suggestion is about 3. You'll probably find that you call the people who are actively marketing towards you and your business on a month-to-month basis, either by flyer, postcard, or door to door solicitation. The brokers who are actively looking for new business are typically the ones who are doing business.

I wouldn’t interview too many agents, because a good one may get lost in the search, and outliers on price and terms may be become less apparent, because inexperienced agents are just telling you what you want to hear just to get your business, as opposed to more experienced agents who are apt to tell you the truth.

Referrals - Let's face it, everyone has a friend or family member who has a real estate license. If you have a friend who sells homes, but swears that they can also sell businesses, but really don't, then interviewing them, but also interviewing 2 or more business brokers who actually specialize in selling businesses will help illustrate the skills involved in getting a business sold, and the techniques involved in selling homes vs. business are not necessarily transferable.

Style - Every business broker has a different style, and it's important that you as the seller feel comfortable with who ever you choose to work with. If the seller and broker feel that they are at odds with one another than it makes the selling process much more difficult. Trust, that the broker is doing you right, and them trusting that you are honest with your books/records or that you are not trying to sell the business behind their back is extremely important.

Price/Terms/Commission - These three things are the most common that are brought up when a seller interviews a broker. How much is my business worth? How long is the listing contract? What is your commission? All brokers can negotiate all three with their potential seller. When a seller interviews 3-4 quality business brokers, they should notice a similarity with all three, and be able to immediately spot an outlier. Typically, experienced business brokers will able to give you a ballpark figure of a selling price, tell you the industry average on listing term agreements, and roughly the same on commission. If you interview too many business brokers, it will be more difficult to spot outliers, because like anything, something that is too good to be true, typically is.

One other thing, because business brokers take in a higher volume of listings, than say a real estate agent who sells homes, not only are you interviewing the business broker, they are also interviewing you, because they work on commission and have to determine, are you and your business worth the out of pocket money and time that will be spent until the business is sold?

I would suggest a seller be prepared with necessary documentation when meeting with the broker, just as much as you expect the broker to be prepared on how to show how they get businesses sold.

Categories: BizBen Blog Contributor, Business Broker Information, How To Sell A Business, Selling A Business

Contributor:

Joe Ranieri
Areas Served: Orange, Los Angeles County Areas
Phone:  714-292-5448 Cell, 714-292-5448 Text
Having owned both retail and restaurant businesses for over 20 years, my interest turned to selling businesses rather than owning them. I specialize in Los Angeles & Orange County restaurants, fast food independents and chains, bars, & liquor stores. Call me direct at 714-292-5448 Cell/Text.

Other Related Blog Posts, Articles, And Discussions You May Be Interested In

Tips For Business Sellers Business Owners: Do Not Make It Hard To Buy Your Business - Successful Tips

Successful sellers of small businesses need a game plan to sell their California small business for maximum price and for the best terms. Peter Siegel, MBA discusses these seller strategies with BizBen Blog readers based on his experience as the lead Advisor with the ProSell Program on BizBen.com.
8 Questions To Sellers 8 Questions You Most Likely Will Be Asked When Selling Your Small Business

When selling your small business, you'll be bombarded with questions - from the brilliant to the ridiculous. You need to be prepared. Here are some of the key questions you can expect to be asked. Tim Cunha (SF Bay Area Business Broker) reviews many of these possible questions from potential buyers.
Pocket Listings Pocket Listings: Vast Hidden Market Or Myth With Business Buyers & Sellers?

What percentage of businesses for sale that are advertised and/or sold are pocket listings? What is the best way to find out about pocket listings? Are they advertised? Are they a big part of the businesses sold marketplace? In this Discussion ProIntermediaries and ProAdvisors discuss this topic.
Key Factors Play A Role When Selling When To Sell Your Small Business - Many Key Important Factors Play A Part

Determining the right time to sell a private business is as much an art as a science, because there are so many factors at play and each business is unique. The timing of a business sale is critical. Christina Lazuric, CBI, Orange County Business Broker discusses this topic on this BizBen Blog post.
Questions To Ask A Business Broker Hiring A Business Broker? Ask These Top Key Questions First, Then Decide

The key to finding the ideal business broker or agent and selling a small business is asking the right questions and getting the right answers back! Peter Siegel, MBA with BizBen & several top business brokers and agents (ProIntermediaries) in California contribute to this topic to assist sellers.
Curb Appeal Selling A Business Does Curb Appeal Really Help Sell Small Businesses? Brokers & Agents Discuss

This post is essential reading for any prospective business seller. Curb appeal is critically important, not just to the amount of the final sale price, but also to whether there will be a sale at all. Top ProIntermediaries and ProAdvisors discuss this valuable topic on this BizBen.com Discussion.
Buying A Health Club Successfully Working Out A Deal: Things To Consider When Buying A Boutique Fitness Gym

First thing you may be asking, what is a boutique gym? Simple, a boutique fitness gym is on average much smaller than your typical large-scale gym, ranging from 800 to 2,500 sq ft. In this BizBen blog post, Joe Ranieri (Southern California Business Broker) discusses this topic for gym buyers.
How To Select A Business Broker Selecting A Business Broker To Sell My Business: What Should I Look For?

What should your business broker do for you to successfully sell your small to mid-sized business? Well, there's many things that a qualified business broker can and should be doing for you. Multiple ProIntermediaries and ProAdvisors give suggestions and tips to sellers in this BizBen Discussion.
Giving Buyers Tax Returns Should Sellers Of Small Businesses Give Potential Buyers Their Tax Returns?

Should small business owners/sellers or brokers/agents give potential buyers direct access to past company tax returns and financials (profit & loss statements) either before or pre the due diligence process? Multiple ProIntermediaries and ProAdvisors discuss this topic on this BizBen Discussion.
Business Buyers Biggest Mistakes What Are Buyers Biggest Mistakes? The Pro's Examine 25 Of The Most Common

A business buyer in our ProBuy Program searching to buy a small business asked me to sum up what I thought the biggest mistakes business buyers make when they search for and bought a small business. I asked ProIntermediaries on BizBen their thoughts on the matter and received a diverse response.