How Do I Choose the Right Broker?

This is the first and maybe the most important step you need to decide on prior to getting your business ready to go to market. The value of your business and the right time to sell are issues to be handled after a broker reviews your business information. But, right up front, there are some key points that you need to consider prior to signing a 9 month to a 12 month Representation Agreement or Marketing Agreement:

1. Do you like the broker? This may sound pretty basic, but it is important. You will be working on a weekly basis with your broker or intermediary, so you need to like them as a person since you will be working with them for up to a year.

2. Do you trust your broker? This will be one of the most significant decisions you make in selling your business. You want to make sure that the person you are dealing with is ethical, professional, and straight forward with you versus merely telling you what you want to hear.

3. Does your personality mesh with the brokers? If the broker is really loose and easy going (not necessarily a bad trait), but you like lists, details, immediate call-backs and regular updates, this may not be a good match. How the broker handles themselves at the first meeting will tell you a lot. Did they arrive on time? Did they call and confirm the meeting prior to coming? Were they prepared? Did they review the entire selling process and ask for any questions you may have? And, did they listen to you? Listening is a key strength for a broker.

4. How competent are they? Be sure and interview two or three people before making your decision. You want to make sure that they are comfortable with your industry. Were they prepared for your meeting? Are they an active member of the California Association of Business Brokers (CABB) or the business brokerage association for your state? Do they have the distinction of having their Certified Business Intermediary (CBI® ) and or their Certified Business Broker (CBB®) certification? The CBI® is held by less than 10% of all Business Brokers. This tells you that they are quite competent, have taken 60 extra hours of classes in their field and continue to stay current with the industry and market changes.

5. Are they giving your company the best exposure you can possibly get? Ask questions when meeting with them. How will they be marketing your business? How long does it typically take for a business like yours to sell? What is their average time with a listing before it sells?

6. Are they willing to give you a list of referrals who they successfully sold in the last 18 months?

Remember, this business broker is going to be representing you through out the entire sales process from listing to closing the sale. You need feel comfortable with your selected broker and able to trust this person with your business.