Selling a business can take a lot of time and effort, so it is a good idea to get professional help. Business brokers are experts in helping their clients to sell and buy businesses. You can find Melbourne business brokers by searching the internet, Yellow Pages, real estate websites and industry-specific magazines and publications.
A Melbourne business broker will usually charge a percentage of the final sale price as a fee for their work. You’ll need to weigh the pros and cons of using a business broker, and make the decision that is best for you.
Advantages of Melbourne Business Brokers
- They will have experience in marketing and advertising businesses for sale.
- They can save you time by screening buyers and deciding who is and isn’t serious.
- They will usually already have a list of contacts who are looking to buy.
- Melbourne Business brokers feel confident and comfortable with requesting the disclosure of a buyer’s financials and are well placed to make decisions about them.
- They can remain independent through the process and work efficiently towards selling your business without the emotional attachment that you may have.
- Typically, brokers have strong negotiation skills.
Disadvantages of Melbourne Business Brokers
- You have to pay for the services of a business broker.
- You might feel you lack control over the process if you are used to doing everything yourself.
- You might feel some pressure to accept a contract you’re not happy with.
- They may want you to sign a contract at a lower price rather than not selling because their fee is a percentage of the sale price.
What to Consider?
How can you avoid losing valuable time to a bogus broker? What questions should you ask to ensure you don’t get in bed with a dud? And what red flags should you watch for?
1. Experience Counts
You want a broker with a proven resume, not someone who just hung their shingle yesterday. Finding a credentialed Melbourne business broker offers this assurance.
2. Beware of Generalists
It’s not enough to Google any brokers you’re considering using and call their references. Part of the vetting process includes making sure your broker is the right fit for your business. For starters, you want a broker who specialises in selling the type of business you own, be it a dotcom, a restaurant or a graphic design firm.
3. Size Does Matter
Also critical is whether the broker you choose typically handles transactions of your size. If they handle $10 million deals and your deal is $3 million, they’re not going to give you the level of attention you need.
4. Manage the Process
Getting a clear picture from the get-go of how the process will unfold is critical. Ask what the steps will be in valuing your business, preparing the business for sale, uncovering potential buyers, and following through.
Another key detail to work out: how the broker will keep you apprised of interested prospects and the transaction status. You want to have weekly status reports, calls, and updates.
5. Negotiate the Fee
Typically, business brokers make their money by collecting a commission on the sale of your business. If anybody asks you for money up front, that’s a big red flag
Although the average commission brokers make is 10 percent, like everything else in business, that figure sometimes can be negotiated.