This article are provided for information purposes only, and are not intended as legal advice.


What services do you expect of a business broker?

October 30th, 2009
Unlike a house purchase where the buyer and seller have their own agent, business brokers often represent both buyer and sellers of the business. What to expect of your broker is dependent if you are the buyer or seller of the business.
 
 
What to expect from the broker if you are the seller of the business
  •  Education into the process of selling a business.   If you have never sold a business you need to be advised of the steps and procedures and an estimate of how long it will take to sell the business
  • Guidance to the valuation of your business Preparing the 2 to 3 page summary of your business to be sent to potential investors as a teaser
  • Preparing the detailed package for investors who are more interested
  •  Assisting in the contents of the letter of intent
  • Assisting in the negotiation and mediation of the purchase and sale agreement

 

What to expect from the broker if you are the buyer of the business

  • Education into the process of buying a business. If you have never purchased a business you need to be advised of the steps and procedures and an estimate of how long it will take to sell the business
  • be advised of most recent businesses for sale
  • assistance determining how large of a business can the buyer afford to buy
  • assisting in providing information to the investor about the business for sale so that the buyer and make an informed decision on whether to proceed to the next step
  • guidance in what to include in a letter of intent
  • mediation and guidance into what should be in the final purchase and sale agreement

 

Business brokers get calls from prospective investors all the time.  Unfortunately, the last person who the broker talks to is often the first person to find out about a new business for sale.  If the broker knows you are currently active looking for a buyer but would have to check to see if each person who called the broker 6 months ago is still interested in buying a business, what would you do?  It is easier to discuss a sale with a person who is active and is on the end of a phone rather than dig through your contact book  to find a person who may or may not be looking.  In summary, this means that all investors need to keep in contact with their brokers every month.  That way, the broker is aware that they are still looking and will notify you of new businesses for sale if they know that you are still active in the market.


Filed under: Business brokers — Gary Landa @ 8:39 am


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