What You Need To Know When Choosing A Business Broker
There comes a time when your business grows and you have to sell it for you to move to your next chapter in life. It can be tempting for you to sell your business alone. You will need to hire a reliable business broker. It can be hard to identify the right broker. Read on to get tips to help you settle for the right business broker.
It is vital you choose a business broker with experience. You need to know how many years they have been operational. Also, ask about the deals they have closed every year. By knowing all this, you will get to know if they do quality work and they are able to represent you well.
It is an added advantage to find a business broker who has sold businesses that are similar to yours. This shows that they are able to deal better with the challenges that arise and close the deal within the given time. Also, you can find a broker who is newer in the industry and give you good representation provided they have a reliable company behind them.
Make sure the business broker has the needed credentials. They should be licensed. Get to know the organizations and other groups that they are a part of. You will get to know how involved they are in the business community. They need to be well connected to bankers, attorneys and accountants.
Also, choose a business broke who is responsive and open. They need to take their time to listen to you. This is for them to know your goals. Keep in mind that it can take time to sell a business. You may not get any news for weeks. You need to decide on how often you should be communicating.
It is advisable to avoid genralists. Identify a broker who is ideal for your business. Size is also an important factor. A broker who handles transactions worth tens of millions of dollars may not provide you with the attention that you expect if your business is worth about a million dollar.
It is important to know in advance what the process will entail. You need to know all the details involved in preparation for sale. You need also to discuss with the business broker how they will keep you appraised on transaction status. The business broker needs to provide you with weekly status reports and updates.
Business brokers rely on commission. Don’t choose brokers who request for money upfront. Business brokers usually charge about 10 percent commission. However, you can negotiate this figure. Compare the rates of different business brokers for you to choose one who fits your needs.You will spend a long time with the broker.If they don’t show you the potential to sell your business, choose a different broker.