When making the important decision to sell your business, having the right business broker on your team is an important part of the process. Although there will never be one broker that fits all of your preferred dimensions perfectly, it’s important to consider your selection criteria and focus on the characteristics that are most important to you. In a challenging time, finding the best fit will help ease the transition into your succession.
With that in mind, here are some tips about how to find the right broker for you:
When selling your business, it is essential that a broker understands your interests and represents them well. Instead of rushing the deal, your ideal broker should fight on your behalf to obtain the highest sale price possible. These intentions should be clear from your first meeting.
While conducting a proper valuation is a critical step early in the sale process, be cautious of brokers that request money upfront for a valuation. In some cases, brokers who focus too much on fees may be more interested in promoting and selling their services than selling your company.
Sellers should understand that a successful succession is influenced a healthy relationship with one’s broker. Throughout the process, transparency and openness on behalf of both parties will help you to trust the advice and decisions of your broker. The chemistry between this two-way connection should be instant.
The first thing a broker should do is to analyze the seller’s rationale and goals to develop a marketing strategy. This step takes time to get it right and if a broker rushes through this part of the discussion, it could signify that you should move on to a different broker.
Knowledge is power and prospective brokers should inform themselves about every detail of your business and ask questions that clarify areas where there could be a misunderstanding. A thorough understanding of your company’s strengths and weaknesses will help your broker market your company and prove invaluable during the negotiation stage.
Google your broker to see if there are any reviews or his or her services. Your broker should be a trusted adviser in the community and respected by his peers. Confirm that your potential broker has developed solid relationships with law firms, accountants, bankers and other professionals. A track record of giving back to the community or serving on nonprofit boards is another positive sign that the broker is well-connected and established.
When you evaluate prospective brokers, it’s critical to ask them about their advertising budget and how they plan to build awareness of your sale. Your business be listed on top business-for-sale marketplaces and your broker should develop a solid online and offline strategy for promoting your business to targeted buyers.
Upon your first meeting, your prospective broker should discuss how they plan to identify and screen potential buyers, detailing the types of questions they intend to ask. Experienced brokers often interview prospective buyers for several hours to ensure they are a qualified fit for the business succession. These hours are not only spent managing countless details, but also the challenging emotions that come with the sale. A qualified broker will clarify sale goals early in the process and repeatedly confirm whether they are exceeding expectations to facilitate the best exit possible.
When everything is said and done, the success of your business sale will be largely determined by your broker’s efforts and abilities. With these suggestions, you should be able to find a great business broker to achieve your sales objectives and exceed expectations for a successful succession.
Ascend Business Partners CEO, Greg Johnson is a Certified Practicing Accountant, Qualified Coach, Accredited Business Consultant, Certified Exit Planner and qualified Business Broker, offering him the expertise to help businesses exceed expectations. Contact us today to learn more.
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