Many businesses are run by entrepreneurs with a do-it-yourself attitude. They are used to taking on more work to avoid having to pay someone to do a job they could do better.
But even if you’ve handled every business decision up until now on your own, battling the world with TED talks and self-help books, selling your business is a whole different animal.
Business sales are often a rollercoaster of emotions and being overly aware of each stage of the process can leave you distracted and stressed. There are many other factors to consider as well when making the decision to hire an M&A advisor.
A solid mergers and acquisitions advisor, also known as a business broker, helps business owners make decisions without having an emotional reaction. This frees up more time and energy for you to dedicate to your business.
They are also trained to filter out the potential buyers who aren’t qualified which can save you a lot of time. A good broker will only provide you with the information and portfolios of the buyers with the most potential.
They also know how to negotiate and consistently close business sales for higher prices than their buy owner counterparts.
Whether or Not You Trust Them
Your M&A advisor should be someone who you know is on your side. They should keep maintaining confidentiality throughout the entire process.
Selling your business will be long and full of loose ends and details. You need a partner who strives to understand your business and concerns. If your broker is listening well, they should be able to anticipate your responses and opinions.
Part of their job is finding out what the right move is and helping you to make the deal that’s in your best interest. Going it alone would leave you handicapped.
Whether They Have a Plan
3-5 years before you want to sell your business, you should start feeling out the market. You need to make sure that your company has a good structure for a sale.
A business broker can help you figure out if now is the right time for you to sell and help you to decide if you’re doing it for the right reasons.
They can also advise you on changes you can make to your business so that it will sell for a higher value down the line.
How Much Time You’ll Spend With Them
Working with your business broker will be a lengthy relationship. They may end up working on your sale, on average, 400-800 hours over 9-15 months.
While many things are out of your broker’s control, they can still provide you valuable advice on legal issues, licensing concerns, the economy, environmental impact issues, customer retention problems and more.
While there will likely be lawyers, bankers, and accountants on your team too, your broker is the only person who will be with you for the entire process. Make sure you choose someone you like.
What Their Fees and Commissions Are
Business sales are different than home sales. Your broker has a much more complex job than a real estate agent.
Things can come up during the sale of your business that are unexpected and time-consuming. It’s not uncommon for brokers to charge fees after your sale has passed a certain threshold.
Make sure that you talk to your broker about what is included in their commission price and what might cost extra.
Whether or Not You Have Disclosed Everything
If you want your deal to fail, then keep information from your broker until the end of the sale. If you want it to succeed, disclose, disclose, disclose.
While you may end up having a difficult conversation, your broker is there to support and guide you through it.
At Dolan Sales, we help business owners navigate the complex sale process. Before you list your business buy owner, contact us for a consultation.