How to choose your business sale broker
So, after spending many years of blood, sweat and tears building your business, it is time to sell.
Regardless of the number of years you have invested to get your business where it is today, it’s safe to say that you probably want to maximize the business sale proceeds (net of tax), complete the sale as quickly as possible without damaging the business whilst also protecting management and employees as far as possible.
You have decided that trying to sell without professional help is risky and you cannot secure the confidentiality a normal business sale requires. Perhaps it is time to talk to a business sale professional, but who do you contact?
Every year in the UK many thousands of businesses change hands, from the small ‘one man bands’ to large multi-national corporations. In many of these transactions, a broker is involved to initially find the right buyer and then support the process to completion. Business sale brokers come in all shapes and sizes and one size does not fit all; no two business broker firms are the same.
When choosing your broker, you need be happy with both the broker firm and the individual broker that will represent you. Ask the questions that are important to you and make sure you get a straight answer. As a minimum you should be asking:
Who will be my deal-maker if we work together?
You need to understand who will be representing you at the key points in the sale, don’t be sold to by the Senior Broker Executives who then palm you off to a Junior with less experience. It is likely you will work with your broker for up to 12 months if not longer, you need to like them, trust them and they need to be the ultimate professional at all stages.
What marketing will my business receive?
Ask for a marketing plan and if you are targeting a trade buyer, do not under any circumstances accept an advertising only plan. Successful brokers will go and find you the right buyer, they won’t just wait for the phone to ring.
What size of business do you normally represent?
If your business has a turnover of £1 million, don’t go to a broker who normally sells businesses for £10 million. Your broker needs to have the right experience and motivation, too small and you might not get the effort and enthusiasm you and your business deserve, too big and you are taking unnecessary risks.
If you choose the wrong firm, individual broker or both, you will likely put unnecessary pressure on the sale and the timescales and in some circumstances, you could put your eventual exit back by years.
Do your research, meet two or three different brokers and choose a) who you feel will best represent you and your business and b) who you feel will support you and help negotiate your best deal.
You will only sell your business once, so get it right first time.
For more information, see our brochure here