5 Questions You Must Ask Your Business Broker

Introduction

The broker business is tricky mainly because all brokers are not created equal. There are many experts in this profession who perform their duties with diligence, but there are also incompetent ones who can ruin your business deal. The secret is telling the difference. When analyzing brokers, you must look into factors such as their experience, communication style and their negotiation strength. 

History

How long has he been in the broker business? It is important to establish the brokers experience and the successful transaction they have had in the past. They should also give you a list of their past clients, take a few numbers and call them and ask about their experience with that particular broker. It is wise to go for an experienced brokerage company as opposed to an person. Check on their reputation and the number of years they have been operating.

Does he or she have a website? If she does, search the website online and see if it is easy to navigate and they have put up helpful content. Stay away from brokers who have no websites. The Internet is a powerful tool for staying updated on current trends. If she has not invested in a website, then it most likely means that she doesn't take her work seriously and she is not competent. She could also be new in the broker business and lacking in experience. Again, how is she going to attract buyers to purchase your business if she has no website? The Internet is one of the biggest marketing platforms.

Features

Is the broker a member of any professional organization or network groups? There are various professional brokers associations and it is important for your broker to be a member of some of them. The associations are important for networking and sharing ideas across various states. You should also check if he is licensed to operate in your area and what kind of business he specializes in, business sales or residential estate.

What is the fair price for your business? Before you sign any broker business agreement make sure you come to an agreement regarding the listing price. A competent broker should take you through customary valuation techniques. He should also have comparative sales for your business. He should be in a position to estimate the value of your business as per the current market price.

How much commission does he charge? Beware of a business broker who asks for upfront payments before the deal is done. You should also be skeptical of brokers who tell you that they have a ready buyer before he has assessed your business. Brokerage negotiations should take time, do not agree on a price after the first meeting, and also take time to do some research on your own. This way you will know if the price offered by the broker is the best one for you.

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