Whether you are buying or selling a business, having a business brokers los angeles at your side can make the difference between a success and a nightmare. However, not all brokers are adapted to your particular situation. Follow the tips below to choose the broker that best suits your needs.
Start by asking for references from your small circle of business advisors and colleagues. Have any of them ever used a business broker in the past? Were they satisfied? Does the broker handle the type of transaction you have in mind?
You may need to expand your network to find a pool of qualified business brokers who specialize in transaction brokerage like yours. Once you have several potential brokers, it’s time to get to work and reduce the scope. Below are some key factors to consider:
– Is the individual or company professional? Professionalism manifests itself in many ways, including personal appearance, presentation of marketing materials, website, language, mannerisms and expertise. Be both objective and instinctive. Remember that the broker you choose will represent your company, so make sure you are comfortable with the person and company you choose.
– Does the broker have experience with companies like yours? Although it is not necessary for the business broker to have specific experience in your exact niche, it is useful for them to understand the nature of your business and to have experience in brokering transactions with similar characteristics. For example, if you run a family microbrewery, a broker who has already successfully negotiated brokerage contracts for small wineries, family food specialty manufacturers or small breweries may not be familiar with the intricacies of beer, but who could be an excellent choice because of their experience in similar companies.
– What are the broker’s qualifications? Seek licensure, training, accreditation, experience and membership in professional associations.
– Is the broker well prepared? In other words, did the business broker do his research before your initial meeting? Brokers use comparable sales, business and industry reports and other tools to establish company prices. Your business broker should be able to support any suggested listing price, which should be submitted in writing, with documentation.
– If you are selling your business, find out how the broker intends to market your business. Brokers have many marketing tools at their disposal to market their company listings. However, some prefer to use specific marketing techniques rather than others. Be sure to ask the broker to submit a detailed marketing plan.
– What type of companies does the broker work with? For example, if your company has an annual turnover of $50 million, you will need a particular type of buyer, hence the importance of choosing a business broker that can attract these wealthy individuals and investors.
– Check references. No matter how professional, pleasant, experienced, qualified and prepared a potential broker may look, cover yourself by checking references. Ideally, the broker should give you references of companies that have similarities to yours.
Choosing the right broker to sell your business or help you find a business to buy is a process. Do your part to ensure a successful outcome by choosing wisely.
Benefits of hiring business brokers
Selling a business can be a demanding and time-consuming process. This can be time-consuming and can even affect the value of the company, as you spend more time on its sales process rather than on the company’s day-to-day operations. This is where the services of business brokers are useful.
First, a professional broker can give you confidentiality and ensure that only those potential buyers you have approved will be contacted. A reliable and experienced broker can save you time in selecting potential buyers in advance. Brokers can already check whether a potential buyer has the right financial resources to buy your business. They will also ask buyers to sign a confidentiality and non-disclosure agreement. If you try to sell your business openly or independently, you have a high risk of damaging the morale of your staff. You would also give your competitors the opportunity to spread harmful rumours about you and steal your valuable customers. When you hire a sales broker, they can work anonymously, ensuring the protection of your business.
Moreover, selling your business alone can be inefficient, especially if you lack experience. A business broker generally has more experience, resources and tools to effectively reach potential buyers more quickly and easily. However, reaching target buyers is only part of a broker’s job; getting the best price for your company is another important job. A professional broker should have the ability to advertise your business in a way that attracts serious and financially stable buyers. This would certainly increase your profits and benefits in selling your business.
Finally, business brokers can name the value of your company. This process involves more than just income or profits, so you may undervalue or overvalue your business, and these errors have indicative consequences. For an experienced business broker, there is a rare chance of making such mistakes.