Is Your Business Suitable for Sale by Business Brokers?
Making the decision to sell your business is a big step. However, it’s the first in a line of many other major decisions. And in this case, the next decision is whether you should work with a business broker to find potential buyers and negotiate a fair deal structure.
Should you use business brokers to sell? Is your business one a broker would take on? Here’s a look at what factors to consider.
Is Your Business Successful?
Business brokers aren’t obligated to take on every single business they come across. There may be some who know buyers interested in buying and flipping failing businesses, but most people interested in buying a business want to make sure that it’s at least somewhat successful.
If you’re trying to sell a profitable business, there’s a good chance you can find a broker who will work with you.
Do You Have Experience Selling Businesses?
Business brokers essentially act as guides for business owners as they navigate the sales process. Unless you’ve sold businesses before, selling your business can be baffling and time-consuming. And if your buyer has a business broker, there’s a good chance you’ll get swindled. If you want the best possible price, it’s worth getting a broker.
Do You Have a Buyer in Mind?
When you work with a business broker, you’re not just paying for the broker — you’re paying for their network of eager buyers. In this situation, the broker’s fee is more than worth it, as you may not have even found a buyer otherwise.
However, if you already know who you’re selling the business to, you may not need a broker. A good example is if you’re passing your business down to your children. Because you don’t need a broker to find potential buyers and interface with them for you, it might not be necessary to hire one.
Are You Confident in Your Company’s Valuation?
It might seem like a small thing, but one of the most critical services business brokers offer is accurately determining your business’s value. Having a spot-on value is key before you start the sales process.
If you undervalue your business, you’ll potentially miss out on thousands of dollars you’d otherwise see. But if you overvalue it, potential buyers will turn away the second they see the price. Essentially, unless you have a highly accurate valuation already, hiring a business broker is a good idea.
Don’t Miss Out on the Benefits of a Business Broker
In most situations, business brokers can help you in your quest to sell your business at a profit. They can also help you ensure you don’t run afoul of tax laws when reporting the sale, and they can handle the time-consuming work of interfacing and negotiating with potential buyers.
Ultimately, the decision is up to you. Take a close look at your business, determine whether you know any potential buyers, and evaluate your own knowledge about selling a business. You might conclude that you’d benefit from the guidance of a business broker along the way.
