Selling Your Business: 4 Things To Consider When Selecting A Broker
When the time comes to sell your business, having a team of experienced professionals represent you can make all the difference in the world as you work to successfully complete a business transaction. One of the most important members of your team is your business broker, who will be tasked with quarterbacking your deal and leading you through the entire selling process.
Finding the best possible broker to represent you is a key first step when trying to sell your business. In an industry that is saturated with average brokers, though that is not the case for all, it is important to understand some of the qualities that the best brokers and agents possess:
Industry Experience & Business Ownership Experience (Bonus):
Looking for a broker who specializes in selling businesses that are comparable to, and in the same industry as yours, is a great place to start. Because all businesses and industries are unique, even some of the most seasoned veterans may struggle to sell your business if they don’t understand the nuances of your industry.
If they understand how businesses in your industry operate, it will be even more helpful if they have experience selling businesses similar to yours within in the same geographic area and price range. Certainly, the criteria already appears to be very specific, but there are many specialty brokers who focus on specific industries and even more brokers who realistically focus on a specific geographical areas.
Finding a business broker who possesses business ownership experience is an even bigger bonus. It will be much easier to connect with a broker who has been in your very position, can draw from personal experience, and can counsel you through a transaction while putting themselves in your shoes along the way.
A Verifiable Track Record:
When vetting a prospective broker and learning about their past experience, ask them to provide you with specific examples of successful business transactions completed in the same or similar industry, then request the contact information of their satisfied clients. If they “talk the talk” but are unable to provide you with the proof to validate their claims, continue your search for an honest and proven broker.
Honesty & Integrity:
The most successful business brokers are those that aren’t afraid to be upfront and honest with their clients about the state and value of their business. Most business owners would like to think that their businesses should sell for a higher price tag than they will, and this creates a true test for some brokers.
It would be easy for some brokers to agree with their clients and tell them exactly what they want to hear in order to keep the client, but the best brokers understand that lying to their clients about the value of their business will not only cause the business to be overpriced, but it will likely cost them both a deal and their valuable time.
You will want to find a business broker who is honest and will keep you and your business’s best interests in mind as they work to sell your business.
If a broker approaches you and claims to be able to sell your business quickly and without any help, don’t take their word for it. Instead, work with the broker who is well connected and has trustworthy relationships with local attorneys, due diligence specialists, valuation experts, and other professionals who can help you sell your business properly.