Whether you are purchasing or selling a business, having a broker by your side may make the difference between a successful outcome and a nightmare. However, some brokers may not be the best for your particular situation. Use the advice below to choose the best one for your needs.
To begin with, ask for referrals from business advisers and colleagues. Have they employed a business broker previously? Were their services satisfactory? Can the broker handle the kind of transactions similar to what you have in mind?
You may have to widen your net to find a pool of qualified brokers that specialize in brokering deals such as yours. After getting several potential agents, it’s time to get down to business and then narrow down the field. Here are a few important factors to put into consideration:.
– How professional is the individual or firm? Professionalism manifests in various ways including personal appearance, website, speech, mannerisms, and expertise. Use your gut feeling and your objectivity. Bear in mind, the broker you select will be representing your business so ensure that you’re totally comfortable with the individual and company you opt for.
– Does the broker have experience working with businesses like yours? While it’s not necessary for the company broker to have specific experience on your precise niche, understanding the nature of your enterprise and experience brokering deals with similar characteristics will be helpful. For example, if you operate a family-owned microbrewery, a broker with a successful track record brokering prices for small wineries or small brewpubs might not be aware of the finer points of brewing beers but might be a perfect choice thanks to experience with similar businesses.
– What credentials does the broker possess? Look out for accreditation, education, experience, as well as membership in professional associations.
– How prepared is the broker? In Other words, how did the company broker do her or his research before your initial meeting? Brokers usually price businesses based on similar sales and business reports, among other tools. Your company broker needs to be able to support any suggested listing prices, which should be presented in writing, accompanied with documentation.
– Find out the way the broker intends to market your business if you are selling one. Agents have many tools for marketing available to market their business listings. However, some prefer to use specific advertising strategies over others. Ensure that you ask the broker for a thorough marketing plan.
– What type of businesses does the broker work with? For instance, if your business has annual revenues from the range of several million dollar range, you may want a special sort of buyer and that makes it even more important to choose a business broker capable of attracting high net worth investors.
– Look at references. The potential may look professional, experienced, qualified, and prepared potential but you should check references just to be sure. Ideally, the broker should provide you references from businesses comparable to yours.
Selecting the proper broker is a process. Do your homework to ensure a successful outcome by making a wise choice.