In most cases, there is no right or wrong answer to this question. However, if you consider a number of important factors in your quest to sell your business, you should come up with the best answer to suit your situation.
Firstly, you need to establish if you have an asking price in mind. If you haven’t reached this point yet, you may be one or two steps ahead of your plans. In other blogs, we touched on the ways to help assist in valuing your business. As a brief recap, we discussed the huge influence and help that a broker or business transfer agent can have in assisting you to find a reasonably accurate valuation of your business for sale.
If this is you, you may need to take a step back and consider how you are going to value your business before even considering if you want to use the services of a professional broker. A broker may be your answer and if you lack the experience, knowledge and professional skills to get anywhere near to an accurate figure of your businesses worth or market value, maybe you should be talking to an agent. Going it alone could cost you more in the long run.
Assuming that you are in a settled position, with a good valuation figure in mind and are ready to market your business for sale, let’s consider some important points and decide if you need to use a broker to help sell your business:
1. Costs Without wanting to state the obvious, costs are a factor that will need to be considered. Most brokers will charge a percentage of your final sale price and in some cases, will also charge a basic marketing fee. All brokers have varying charges but you can be sure that in all cases, they will expect to take a reasonable chunk of your final sale price. So consider this point carefully. If your sale price is relatively low or only aimed at recouping or clearing a previous loan, debt or investment, a brokers fees could seriously hamper these plans.
However, if your business is one that will attract a great deal of interest from their database of registered buyers, you could end up with a quicker sale. Increasing your asking price by an equivalent percentage to their fees could help to cover these expenses and get you a quicker, smoother sale.
Whichever way you look at it, always ensure you factor these costs into your calculations and decide if you can afford them.
2. Time – Like many in this position, you may want a quick sale. I have sold businesses using a broker and have also sold businesses using my own ingenuity. I can honestly say that neither case is the quicker of the two. Essentially it depends on the quality of the business you are selling and just how desirable and marketable it is.
However, if you need to get a sale as fast as possible, you will no doubt increase your chances of a sale by using a broker. They will use a large expanse of ways to get your business onto the marketplace such as internet directories, magazines, printed newsletters and direct correspondence with their database of registered buyers. Going it alone guarantees nothing but a small saving in agents fees so again, think about the advantages that a broker presents to you and your needs.
3. Experience If you have sold businesses before, you will know about the various stages of proceedings and how complex, time consuming and even stressful it can be. There are a lot of time wasters out there!
If you have a professional and trusted broker at your side, he will take a lot of the strain away from you. Remember you still have a business to run. Do you have the time, energy and ability to handle dealing with interested parties, arranging meetings, discussing due diligence, handling contracts and negotiating sale prices? There’s a lot more to selling a business than simply placing an advert on the internet directories. If you are new to this process, think long and hard about whether you can really handle the extra responsibility and take charge of making a sale. If so, good luck.
Most sellers will be doing this for the first time so a broker will filter out the time wasters, discuss the best times to meet interested parties and what you should expect along the road to getting a sale. You will be paying them a handsome some so make use of them!
4. Contracts Remember that with very broker, comes a contract that you will be expected to sign. Always read the small print. In many cases, agents will expect to represent you as a sole agent, meaning that you cannot use the services of another agent. If this arrangement is undesirable to you, you can negotiate a multi-agency contract however, it is likely that they will expect a higher percentage of your final sale price.
Most agents are flexible and if you wish to use an agent but are hesitant simply due to contractual obligations, you’ll do yourself no harm by trying to negotiate their fees. For example, I previously sold a very small business by using the services of an agent under a sole-agency arrangement only for a short term period. I agreed that they had three months to bring in some serious leads and if I saw little evidence of any real, notable interest, I could simply walk away.
After several weeks and no real movement, I did exactly that. I spoke to another larger agent who charged a significantly larger percentage commission fee and things started to move but still, no concrete sale. Proof that the cheapest option isn’t always the best!
I managed to sell the business myself after advertising the business using all the major online directories so in my case, I didn’t have to pay any agents fees seeing that I found the buyer personally and my contract was not tied to a sole agency agreement. This situation worked for me as I had explored all angles so doing the same yourself agen bola terpercaya may not do you any harm either. Again, it’s all down to time, money and the confidence you have in yourself to get the business sold.
Hopefully these point will give you plenty the think about. There is no real hard and fast rule as to whether you should use an agent. I have met several agents over the years and personalities all differ. Meeting any potential agent is vital in my opinion. If you feel they have the right personality, and give you the confidence that they can really sell (and I mean sell) your business with conviction and integrity, you could have just made a new, trusted ally.
Business is about personalities and how they gel so if you don’t get a good vibe from the first agent you meet, try another agent. If you have the confidence and conviction to do it yourself, they why not? If you find that your efforts lack any real success, you can always speak to an agent at a later date.