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What Should I Be Looking For When Choosing A Business Broker?

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Comments & Replies: 2     Views: 3117     Posted By: Peter Siegel MBA  Peter Siegel MBA: BizBen Founder, ProBuy/ProSell Program Director



Topics: Business Brokerage, Mergers Acquisitions, Selling A Business     Tags: business brokers, buying a business, selling a business



Putting together an all-star team is important whether you are buying or selling a business. One of, if not the most important member of your team is your broker. Before you can find a good broker you have to know what to look for. The business for sale market is littered with average brokers, but that could be said for most industries. Not everyone can be among the best regardless of the industry, but the best business brokers and agents share the following:

* Industry Experience: You should be looking for a broker who specializes in selling businesses that are similar to yours or in your industry. Even the best and most talented brokers might have trouble selling your business simply because they lack experience in your industry. They should also have experience in your geographical area and with businesses in your price range or at the value your business has been appraised at.

* A Track Record That Can Be Verified: Beware of a prospective broker if he's unable or unwilling to provide contact information of satisfied sellers of similar businesses. Once you have this information make sure you actually follow up.

* Local Connections: Any broker who says they can sell your business all by him or herself is a recipe for disaster. Good brokers have relationships with lawyers, accountants due diligence professionals, valuation experts and other local professionals.

* Truthfulness: Pricing is the most common reason business for sale transactions fall apart. But sometimes, some brokers tell their clients what they think their clients want to hear, which can result in the sale process dragging longer than it has to. The best brokers are upfront about values, pricing and other sensitive issues despite the fact that it might not be the news their clients want to hear.


To add to Peter's list --

* A Pleasing Personality: The broker needs to "resonate" with buyers, by being friendly, open, honest, and "nurturing", especially for the first-time business buyer who needs education and guidance.

* Business Ownership Experience: In my experience, it is very valuable for a broker to have a rapport with the business owner, based on personal experience with the financial, logistic, emotional, and psychological dimensions of an entrepreneur selling a business. No one who has not gone through that process can truly counsel a business owner in all the aspects of a sale.

* Availability: The seller should have the broker's personal cell phone number for voice and text, should have direct access to the broker's personal assistant, and should know that prospective buyers are going to have their phone calls answered by a live person, not an impersonal automated systems.

Replies To This Comment
Great points, Timothy. It is important for a broker to be able to sell the business to potential buyers, because a portion of the buyers may be first time buyers and apprehensive of the process, and so a good broker is able to get them over the finish line and buy the business. Many people can find others, either family or friends who have bought a house, and so they can seek advice on the process, but it becomes harder on seeking advice from those about buying a business, because a smaller portion of the population are business owners, and that's where a informed broker is valuable.



  Helpful Resources To Assist In Selling And Buying California Businesses
Brad Steinberg, Broker - Laundromat Specialists

Laundry specialists - founded in 1968 by three laundry professionals, PWS is a family-owned corporation. Through the years it has grown to become the largest vended laundry equipment distributor in the United States. Call Brad Steinberg at 323-721-8832 to sell or buy a coin or card laundromat.

Diane Boudreau-Tschetter: Escrow And Bulk Sale Services

California Business Escrow, Inc. is a full service independent escrow company serving all of California and has expertise in a wide range of escrows. Our team prides itself on providing an exceptional escrow experience. For more info phone Diane Boudreau-Tschetter at 888-383-3331 or 209-838-1100.

Mark Chatow, Esq.: Legal Services For Buying, Selling Businesses

Mark has a broad range of small business purchase & sale experience from analyzing potential acquisition targets to successfully guiding buyers and sellers through the purchase & sale of small businesses. Mark can assist with contracts, negotiations, legal matters, etc. Reach Mark at 949-478-8393.

Elizabeth McGovern: Escrow Services - SF Bay Area

McGovern Escrow Services, Inc., is a leading independent escrow company. We are a trusted partner with our clients, assisting them through the tangled bulk sale & liquor license transfer process. We provide attentive, quality & innovative customer service. Phone Elizabeth McGovern at 415-735-3645.

Willard Michlin, CPA, Certified Fraud Examiner, Due Diligence Services

Willard Michlin, CPA #106752, offers buyers step by step training & assistance in doing Due Diligence Services when they are thinking of making an offer, or are in process of investigating a business purchase. He helps to determine the actual net profit even when there is cash. Call 805-428-2063.

Helen Yoo: Escrow & Bulk Sale Services - Southern California

New Century Escrow, Inc. is a fully licensed & bonded independent escrow company. Over 20 years combined experience in handling bulk escrow transactions. Multi-lingual staff that speaks your language, including Korean, Chinese, Vietnamese. Call Helen Yoo direct at 626-890-1151.

Janet Carrera - Escrow & Bulk Sale Services - SF Bay Area

Redwood Escrow Services, Inc. is a full service, licensed independent escrow company. We are EAFC Fidelity bonded, fully insured & licensed with the Department of Corporations. Committed to offering our clients the most comprehensive variety of escrow services available. Phone Janet at 510-247-0741.


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