How Can a Business Broker Help Me Get a Better Price When I Sell
If you are looking to sell your business, the thing that is probably on the top of your mind is how much money you can get for it. After all, you have put many years of your life into this business, and you want to make sure you walk away with a good price for all of the hard work that you have put in. So, when it comes to the question of whether or not you should work with a business broker on the sale, it is very reasonable to ask how the broker is going to help you get a better price (for your business) than if you sell it on your own.
Business brokers do not work for free, of course, so you know you will have to pay them a percentage of the sale for their commission. This means that the price you sell it for through a broker needs to be high enough to account for their commission and still allow you to walk away with at least as much or more than you would if you had sold the business on your own.
Here are some of the ways that a business broker will help you get a higher price when it comes time to sell:
Assistance with Preparation for the Sale: Most of the groundwork for a successful business sale is laid before the business is ever listed, and this is where a broker can be very helpful. Just as if you are selling a residential property, you want your business to have “curb appeal” and be attractive to prospective buyers.
This might mean upgrading your technology, ramping up your marketing, or any number of other improvements that could be made. This also means getting your financials in order. Your broker will work closely with you during the preparation stage to make sure your business is in great shape and ready to put on the market.
Properly Valuing the Business: It is absolutely essential that you list your business at the right price. Undervalue it, and you leave money on the table. Overvalue it, and you might find yourself wasting several weeks or months with the business listed before you realize that the price needs to be reduced. Business brokers have in-depth experience valuing businesses based on the right valuation method(s) for the industry. They help sellers set the right asking price based on the current market conditions and other important factors.
Relationship with Buyers: At any given time, business brokers have several businesses listed for sale, and they also have a list of buyers who are interested in purchasing a business. Because of their relationships, marketing efforts, and connections in the industry, when you list a business with a reputable broker, you have access to a much larger pool of prospective buyers. This puts you in a better position to receive an offer for at or maybe even more than your asking price.
Assurance of Confidentiality and Discretion: When an owner tries to sell their business on their own, it is very difficult to maintain confidentiality during the sales process. This may mean employees finding out about the sale before they should, trade secrets being exposed, and other potential problems that could become very costly. Business brokers have time-tested procedures in place to help ensure that confidentiality and discretion are maintained throughout the sales process.
Role as Intermediary during Negotiations: One of the most difficult steps in selling a business is negotiating the price, terms, and conditions of the sale with the buyer. Business brokers are experienced with these types of negotiations, and they can act as an intermediary to help you and the buyer come to an acceptable agreement that prioritizes protecting your best interests.
Working with a Reputable Business Broker: These are some of the most important ways that business brokers can help sellers get a better price. Remember, brokers are professionals who specialize in the buying and selling of businesses, and they thoroughly understand the ins and outs of this often complicated and confusing process.
An experienced broker will not only help you get an optimal price for your business; they will also work closely with you and handle the sales process from start to finish. This allows you to focus your energies on running your business and preparing for the next stage of your life.