Why Hire an Intermediary (Business Broker) to Help You Sell Your Business?
By Olga Kennedy & Don Emmett
Business owners sometimes call us with questions about selling their businesses and whether or not they should hire an Intermediary (business broker) in lieu of trying to do it on their own.
Why should I hire a business broker? Why should I pay for someone to help me sell my business?
Hiring a business broker has significant advantages, some of which we’ll list here.
- We tell business owners that business brokers work confidentially. In most cases, sellers do not want their employees, competitors, vendors or customers knowing that the business is for sale. Business brokers will market the business in a confidential manner; they will not give any significant information. Until interested parties are vetted, provide certain information, and sign certain documents, especially a confidentiality agreement, the selling of the business with a business broker is kept completely confidential.
- Brokers have their own sources for buyers (economic, strategic, & financial) sometimes numbering in the thousands, that a business seller on his/her own would not have access to. The broker will not only spend their time marketing the business, but also handling all the inquiries that come from marketing efforts, allowing the business owner to concentrate on running the business.
- Seasoned business brokers have considerable knowledge and experience doing business valuations (“Opinions of Value”). They can consult with owners on the value of their businesses, and if the business, is in fact “sellable”. If an owner decides to sell, business brokers help sell their business. That’s what they do. They have the experience of selling many types of businesses to a wide variety of buyers. They have the time and the know-how to get the business transfer completion—to reach the “Closing table”—which is the “ultimate goal” of a sale. Additionally, business brokers have the expertise and resources to act throughout the process in a way that avoids and minimizes any potential problems that might occur after Closing.
Selling their business is one of the most important and potentially stressful decisions a business person can make in his/her lifetime. As you would with any professional, you should expect a business broker to provide expert, professional advice with YOUR best interests in mind. You should expect a broker to fully answer any questions you may have about the selling process, to understand your goals, and work with you on how you may be able to reach them. You should not expect a broker to pressure you toward any decision in which you are not comfortable.
We believe that there are certain circumstances when you may want to explore selling without a broker, and we often discuss that option with sellers. But, regardless of the ultimate decision you make, we feel strongly that the advice of professional, experienced business broker should add value to the process and assist you in making the best decision for you. In conclusion, if you think the services of a professional are expensive, the services of an “amateur” can ultimately be much more “expensive”!