If you’ve made the decision to sell your small business, your first step will be to hire a business broker. Working in the same way as a real estate agent, the broker’s job is to find buyers for businesses. To get the price you want for your business, take your time choosing a business broker. Here are a few tips to guide you through the process.
As a small business owner you can use your business network to see if anyone is happy to recommend a broker. A referral from a trusted source is always a good place to start looking. Speak to contacts who have recently sold their business, your accountant or lawyer may have advice, and your industry group or association may also have a list of trusted brokers.
Find out as much as you can about any business broker you’re interested in hiring. Have a look at his or her credentials and see how much experience they have. Independently check their references, too. The more satisfied customers you can speak to, the better. You want to ensure the broker has the skills and the ability to sell your business and find the right buyers.
Your broker should have experience selling a business like yours. Check that he or she is experienced or a specialist with businesses in your industry and know the way your market works. The broker should have experience selling in your location and be familiar with the area, as well. Also check they have experience selling business in a similar price range to yours. You don’t want them over or under valuing your business. Many real estate agents also work as business brokers on the side. Ideally you want a broker who specialises in selling businesses. The broker’s focus should be on you.
Ask to see the broker’s marketing plan for your business sale. The advertising the broker puts into action needs to attract the buyers who are interested in your industry. The more leads the broker’s marketing can generate, the better for you and your business.
To ensure your broker is trustworthy check he or she is certified by or a member of the local professional body representing brokers. These groups make sure brokers act within in the law.
Your broker needs to keep the sale of your business under wraps. Employees may choose to leave the business if they hear it is for sale or suppliers may look for other markets. Selling your business is a confidential process and the loss of staff or suppliers can negatively affect the final sale price. Ask the broker what steps they take to keep your business affairs confidential.