When selling your Boston company, the expert insight of a business broker can go a long way. The right broker frees you to focus on continuing to run your company, while offering a wealth of insight about what to expect, how to expertly negotiate the deal, and more. But not all business brokers are created equally. This is a business, and like any other business, there are exceptional practitioners and exceptionally shady ones. Don’t let a bad business broker deter you from seeking help, though. If you notice any of these behaviors in your business brokerage firm, it’s time to switch providers.
Lack of Follow Through
A good broker wants to help you see the deal through to completion—and that requires them to return your calls, to follow up with buyers, and to lead the charge to create a competitive bidding environment. If your broker seems absent, annoyed, or disinterested, it’s time to find someone better.
A Generic Marketing Plan
What makes your business special? And how will buyers respond to your company? A good broker should be able to answer these questions with clear specificity, then devise a strategy that targets your ideal buyer—not just a random group of potential bidders. If the marketing plan your broker outlines is generic, gimmicky, or seems applicable to any business, they’re not really doing their job.
Pressure to Commit Before You’re Ready
A good broker will earn a significant commission if you sign on the dotted line. But exceptional brokers also know that it’s about finding the right buyer, not just the first one who comes along. If your broker pressures you to commit to a sale that’s not right for you, or seems to have little time for locating the right buyer, odds are good they’re not confident in their own ability to help you find the right deal. Good brokers care about an excellent fit.
A Fee Structure That Doesn’t Incentivize a Sale
Most brokers charge an upfront fee and a commission. But if most of the fees are front-loaded, nonrefundable, and not tied to success, then your broker doesn’t have a significant incentive to help you sell your business. Choose only firms that require success fees, not those that charge a gargantuan sum from the outset. Be sure also to ask lots of questions about fee structure, including what happens if the deal never closes or there are additional costs associated with your business broker’s work to sell your company.
Conflicts of Interest
Does your business broker keep connecting you to the same business, or seem unusually friendly with your deal partner? Conflicts of interest can color perceptions and make it difficult for your business broker to give you unbiased advice. So ask about their history working with the other side of the table, and always check references to assess how trustworthy your broker really is.