So you’re thinking about going the less expensive route and keeping most of the earnings from the potential sale of your business for yourself. There’s no doubt that this has crossed the mind of practically anyone who is thinking about selling their company and is trying to decide whether or not to invest in partnering with a website broker. As with all types of business transactions, there are pros and cons to choosing to work with an experienced professional.
Sure, you’ll give up some of the percentage in a final sale offer but the amount that a business broker could get you by helping you to find the right buyer and in advertising your company the right way might enhance the overall value of your business so much that the percentage paid as commissioned to the broker feels negligible. There are two major choices that you have when approaching selling a company: selling on your own or hiring a business broker and there are pros and cons with each approach.
Pros of Hiring the Right Broker
It’s important to remember that hiring the right business broker to sell your company can make a world of difference in how you feel about outsourcing. There are many different reasons to consider partnering with a broker that has an extensive track record and plenty of testimonials from happy clients who have been able to achieve a high multiple on their sale. The pros of hiring the right business broker include:
- Helping in the negotiation and vetting buyer stage.
- Having someone to walk you through the process and answer your questions from the beginning all the way to post sale.
- Understanding the current multiples and market trends for your individual business.
- Having a list of interested buyers in their network to promote your company to.
- Assist you in creating the necessary documents to list your company for sale.
These are all major benefits that can help a successful business owner to continue running their company without having to worry about many of the aspects of listing the company for sale and interacting with prospective buyers. However, there are also cons associated with working with a broker. These include:
- It’s more expensive since brokers will charge a percentage fee based on the sale price.
- You might prefer to communicate directly with a buyer although this can lead to greater break downs in negotiation and a greater investment of your time.
- The quality of brokers can vary widely so it’s important to choose the right person to partner with by looking at their testimonials and past work in the industry.
- Brokers often incentivize getting a deal to the point of closing as soon as possible, which might not be in your best interests. An ethical broker, however, will consider all aspects of listing your company for sale.
Unless you have existing leads for potential buyers, a strong financial background or some other significant reason to list your company for sale yourself and follow it through to completion, it is strongly recommended that you partner with experienced and qualified business brokers. Having the peace of mind provided by someone who is familiar with this process can be instrumental in helping you to capitalize on exiting your business the right way.