Why use a business broker to sell your business?
Latest Business Insights
Selling a business can be stressful for owners - especially selling a business that may have been built up throughout a lifetime of commitment and dedication.
Attracting the right potential buyer to achieve the maximum value from the business sale means an owner needs their business operating at peak performance and profitability when the venture is put on the market.
While running a busy business, owners will need to consider a raft of factors when looking to sell. These include:
• The true market value
• What other businesses are currently available for sale
• The best time to take it to market
• Should it be an ‘on-market’ or ‘off-market’ campaign
• Maintenance of smooth on-going supplier and customer relations
• Staff stability and employee confidence in ongoing operations
This is where an experienced business broker is beneficial to the sale process, as the owner of the business focuses on their key strengths, and the business broker creates the best environment for the best buyer for the business. This can often be done before the staff, suppliers and customers find out the business is currently on the market or has been sold.
Another important reason for selling through an experienced business broker is their company’s ability to tap into a huge market network to identify prospective buyers, both passive and active.
Specialist business brokers and their company, spend years putting together databases of investors and business operators who are actively searching for a new opportunity, as well as multiple business owners looking for their next investment.
Often a business broker has been building relationships with business owners and buyers in a specific industry like the retail, industrial, service and hospitality markets and will have an impressive professional network of contacts, along with an enormous database to draw on. These connections are often outside of an owner’s own realm of contacts and networks.
Sometimes owners are also too close to their business and may not be able to see all of the business’ positive and negative features. Understanding and promoting a particular business’ strengths while minimising its weaknesses from an impartial viewpoint is critical for a successful business sale. A business broker will have a wider understanding and comparative view of what sells well, how and why.
A business broker can take into consideration all of these factors as well as where the current buyers are, how many there are and if they are looking to buy now or in the future. This helps to plan the sale process and timeframe. Prospective business sellers should allow sufficient lead time to sell their business for the best possible return within context of the wider market setting and buyer environment.
Other benefits of a business broker include:
• Considering the timing of the sale process. When it comes to timing, in some cases a business broker may recommend not selling a business until some key practises are improved or a plan is in place to showcase its ongoing strengths and future potential.
• A business broker can assess the level and extent of additional business advisors needed throughout the sales and marketing process. Every business sale should be scrutinised in advance by a designated accountant and a lawyer working for the vendor.
Ultimately the selling process needs to occur with as few obstacles as possible while maximising your business value and reaching as many potential buyers as possible. Business brokers will ensure they know your business inside and out and as well as you do. Preparing the business and streamlining the process that limits the complications and the stress for the owner is where a business broker adds real value to the transaction.