Why would you need a business broker?

Selling your business is a critical decision that requires careful thought and strategic planning. The question that vexes small business owners is:  should I hire the services of a business broker?

Honestly the choice is obvious if you carefully analyze some of these hard hitting questions:

• Are you ready with your buyer list? 
• Are you ready with your marketing plan?
• Are you ready with procedures to ensure complete secrecy is maintained?
• Are you willing to do all the leg work and deploy sufficient time to sell your business?
• Are you qualified to adhere due diligence procedures?
• Are you an expert in selling businesses?
• Are you aware of legal and accounting issues relevant to deal making processes?
• Are you qualified to evaluate the right price of your business?
• Are you sure you can do the best possible job of selling than anyone else?
• Are you confident you can handle the negotiation process to get the best out of the deal?

If you are positive about all the above points, you are all set! You are ready to handle your own business sale. However if, most of the answers are negative or unsure, you definitely need the services of a business broker.

A business broker will help to match you with the right buyer, so that you get the best possible deal and your business is transferred to the right hands. A business broker or intermediary must possess multiple skills to achieve this mammoth task. The right business broker will possess an array of skills like:

• Powerful and effective communication techniques and negotiations skills
• Hands on experience in selling and sharp business acumen
• Strong leadership qualities
• Knowledge and expertise in preparing marketing plan and salesmanship
• Quick grasp of your business, accounting procedures, laws and tax policies
• Industry expertise to provide right guidance and tips on whether to sell now or later

An expert business broker will provide full range of services to the client from business evaluation, to identifying obstacles, preparing effective marketing plan, drawing up the right buyer list, determining the correct selling price, negotiating best possible deal, giving tips to enhance the value of business, researching when is the right time to sell or even question your decision to sell and provide you with better alternatives like going for expansion or strategic buying.

The right business broker will not want a quick sale just to lay hands on commission. They should be a partner in the entire process to understand your ultimate goal and provide smooth transition to achieve it.

Check list that will help you select the right business broker for you:

• Credentials and experience in this field
• References of previous clients
• Quality and control systems in place to ensure things are done promptly, in right sequence and complete secrecy is maintained to ensure successful sale.
• Check whether they are part of recognized associations like IBBA, ABBA, APMAA, AM&AA and their membership status in these organizations.
• The qualifications and expertise of the support team in place. No broker is an expert in all the field e.g. accounting, tax, law, marketing etc
• Understand the break up clearly for upfront fees, retainers, commissions etc.  Understand what you are being charged for and whether you are getting those services. Don’t be taken in by false promises or any platitudes.

To make it brief, practice due diligence and check the background, work history, credentials of your broker just as a buyer will practice due diligence before buying a business.