Finding the right business brokerage company is an absolutely critical part to a seller’s exit strategy. The sales process should not entail any up front costs as any reputable business brokerage firm will be glad to give a free comprehensive business evaluation as part of the interviewing process. The most effective ways to gauge whether a business brokerage company will competently and professionally sell your business are to make sure the brokerage firm is properly licensed, analyze their online reviews or testimonials, look at the broker’s current business listings, and obtain a business evaluation from the brokerage firm. Let’s explore these methods of gauging the potential effectiveness and professionalism of a business brokerage firm.
Business Brokerage Firm Must Be Properly Licensed
- The Florida Department of Business and Professional Regulations (DBPR) licenses real estate professionals in Florida.
- The sale of businesses is governed under these DBPR mandated real estate license provisions.
- Thus if an individual is purporting to broker the sale of a business in Florida, then he or she must be a licensed real estate agent or real estate broker.
- Moreover, any publicly displayed advertisements for the sale of businesses in Florida must include the full name of the licensed real estate brokerage company.
- The first step to gauge the trustworthiness of a business brokerage company is to go online and verify whether the individual and firm are properly licensed.
View Online Reviews of Business Brokerage Company
After determining that the brokerage firm is properly licensed, the next step to gauge their trustworthiness is to go online and read reviews or testimonials from past clients. The online reviews from buyers and sellers will typically say much about the professionalism and expertise of the business brokerage firm. A negative online review should always be taken with a grain of salt because of the possibility of fake reviews from disgruntled folks who simply thrive on creating negativity. But multiple negative reviews are a far more serious issue. Testimonials on the brokerage firm’s website or online (such as google review) from previous clients who have successfully sold their company are by far the best source of reviews.
Confidentiality Also Important in Online Reviews from Business Brokerage Clients
One note of caution about online reviews is that in the business brokerage industry, confidentiality is of utmost importance. Business sellers and business buyers often want to keep the sale private and not display it publicly online for a number of different reasons. So unlike with real estate, a professional business brokerage firm will be far more cautious in identifying the actual name of the sold business, and will only do so with the express permission of both the buyer and seller.
View Current Listings of Business Brokerage Company
The typical real estate brokerage company has no current listings of businesses for sale. That is because they do not specialize in the sale of businesses. They specialize in the sale of residential or commercial real estate. There is an enormous difference between selling real estate and selling businesses. Very few brokerage firms sell businesses, and it is even more rare for a brokerage firm to exclusively sell businesses.
Trustworthy Business Brokerage Firms Will Have At Least Ten Active Listings of Businesses for Sale
- It is strongly recommended that prospective sellers go online and visit the websites of any brokerage firm they are considering hiring for the sale of their business.
- The website should list the brokerage firm’s current and active listings (note that many websites list other brokerage firm’s listings rather than their own) of properties or businesses for sale.
- If the website does not show at least ten listings of businesses for sale, then the brokerage firm is almost certainly not actively or exclusively selling businesses.
- Without a sufficient number of active business listings, the brokerage company simply will not have the expertise or experience of actually selling businesses (they also will not survive financially by selling businesses) nor will the brokerage company be able to attract buyers that naturally gravitate toward brokerage firms with a large number of listings.
Obtain Free Business Evaluation from Business Brokerage Firm
- After determining the legitimacy and experience of the business brokerage firm through online research, the best way to ultimately determine their trustworthiness is to meet the broker and receive a free business evaluation.
- During the evaluation process, the business broker should ask and obtain all the relevant information necessary to sell your business and present it properly to buyers in the marketplace.
- This includes properly analyzing your financials and identifying hidden assets in order to maximize your sales price.
- At the conclusion of the evaluation process, the business broker should discuss a suggested asking price for your business.
- Moreover, the business broker should be able to explain how and why this price was suggested.
- Importantly, the business broker will need to justify this price to potential buyers – so he or she should justify and explain this price to you as the seller as well.
- In short, the evaluation process is the ultimate test where the business broker will demonstrate his or her worth to you as the seller.
Finding the right business brokerage firm is a critical step to selling your business. With the right business broker, you have a much better chance at a smooth sales process that results in the best possible purchase price possible.
Give Martin at Five Star Business Brokers of Palm Beach County a call today for a FREE evaluation of your business.