How to Choose the Right Business Broker to Sell Your Business
Updated: Feb 9
When you're ready to sell your business, choosing the right broker is essential. Unfortunately, not all brokers are created equal, and you'll want to ensure you work with someone who knows the market and can maximize your profits. Here's what to look for when searching for an exceptional Sacramento business broker.
A Member of Your Team
You want to be sure that who you're working with has your best interests in mind. Think about how they made you feel from your first conversation and if they would be a valuable addition to your experienced team of advisors. Consider the following questions:
Will they prioritize your best interests?
Did they ask detailed questions about your business, background, and reason for selling?
Did they provide any examples of other companies that they've sold?
Did their examples include businesses comparable to yours in value and market size?
Do they have a marketing plan or solid sales strategy?
Do they value confidentiality?
Were they able to provide a list of client references along with their credentials?
A business broker will need to understand your needs and goals from the sale of your business, so you'll need to feel comfortable having an open conversation with them. Be sure to ask lots of questions and choose someone who prioritizes your concerns.
You'll want to work with someone with extensive industry experience who knows how to get businesses sold. You'll also want to be sure that they have knowledge of your specific geographic market and have successfully sold businesses similar in value. When searching for a business broker, be sure to think about these factors:
What businesses have they sold recently?
Do they have a team with repeated success in your industry or local markets?
What are their credentials?
Can they provide referrals from past clients and contacts they have worked with, such as CPAs and attorneys?
The right business broker will have the knowledge and background necessary to quickly and effectively sell your business for the right price.
Clear Sales and Marketing Plan
Knowledgeable and experienced business brokers should have a clear sales and marketing plan that outlines how they intend to market your business and attract the right buyers. They should also have a process for narrowing down and vetting potential buyers, so you're only working with serious prospects. Key factors include:
Did they take the time to understand your business, key metrics, core differentiators, and unique selling propositions?
Do they have an existing database of buyers to market to?
Do they have experience crafting a compelling listing for the sale of your business?
What are the websites that they use to list your business?
Who's responsible for creating the confidential business review?
Good business brokers are intelligent marketers. They should not only have a list of potential buyers to reach out to but also understand how to present your company in the best light.
Understand the value of your business
You'll want to ensure that who you work with understands how to accurately assess the value of your business. A good business broker will not give you a generic calculation. They will request in-depth documents to see the complete picture of your business. A few things a business broker will ask for and evaluate to determine the value of your business include:
Financial documents, such as tax returns, income statements, cash flows, and balance sheets.
Industry and market trends
Your business's potential for growth
Seasoned business brokers know they need to fully understand the ins and outs of your business to successfully make the sale and maximize your profits.
Once you've found a broker you're comfortable with, it's time to start selling your business. With the right broker by your side, you can be confident that you're getting the best possible price for your business.
If you're looking for a Sacramento business broker, or have any questions, contact us today for a consultation.