Business Brokers, also called Business Transfer Agents, or Intermediaries, assist buyers and sellers of privately held business in the buying and selling process. They typically estimate the value of the business; advertise it for sale without disclosing its identity; handle the initial potential buyer interviews, discussions, and negotiations with prospective buyers; facilitate the progress of the due diligence investigation and generally assist with the business sale.
Broker services vary widely depending on the practice and skill set of the individual broker. The most common services provided by a Business Broker are:
- Assisting the client in establishing an appropriate selling price; the techniques used by individual brokers can vary greatly in this process.
- Developing a comprehensive Confidential Memorandum on the company; normally a 15-30 page document outlining the business for potential buyers.
- Conducting buyer searches.
- Marketing the business to prospective buyers.
- Screening buyers for ability and intent to complete a purchase.
- Coordinating negotiations and providing deal structuring advice.
- Providing overall deal management to guide the client through the entire process.
- Helping maintain confidentiality of the sale.
- Hourly consulting for a fee, based on the client’s needs.
Most importantly, Business Brokers allow the owner to stay focused on running their business during the sale process, which can take on average 6 months to 12 months to complete.