Finding Multiple Interested Business Buyers

Selling a Business can be daunting all alone. Most business owners have no clue regarding how to sell a business. It is much more complicated than selling inventory or services. The attempt to save a few thousand dollars in commission for business brokers Baltimore can end up costing owners millions.

Business Buyers

Serious business buyers often make a career out of buying businesses for investment purposes. That means they have purchased hundreds of businesses and have a great deal of experience. Sellers are more apt to be selling a business for the first and only time. Buyers and their brokers will do whatever they can to get an excellent deal.

The situation tips the process in favor of the buyer. An experienced business broker for the seller can balance out that discrepancy in experience. The results include a higher business valuation determination, and the potential for a quick sale. Most brokers have a data base of interested buyers waiting for the right business to buy next.

The Valuation

Brokers include both tangible and intangible aspects of the business in the valuation. This differs from the valuation process of a real estate agent. In addition to equipment, inventory, and the space, a broker considers the success of the business, the potential for growth, and the experience of management and staff members. Investors will want to keep as much as the current staff as possible because they do not intend to operate the business.

Marketing

A broker utilizes several techniques and resources to attract multiple interested buyers. Inexperienced sellers will not have access to as many buyers. Brokers present businesses in the best possible manner to get the maximum selling price. The difference can be thousands or millions more dollars than the seller would have gotten alone.

Who Pays?

The business seller typically covers the cost of the commission to the broker. Fees do vary, but are not expensive. A standard commission, for example, is usually ten percent of the first million dollars, and five percent of each million after that. Even with commission, sellers leave their businesses with more money.

Keep in mind that commission is paid at the time of closing rather than up front. An owner can set up a consultation to answer the internal question of how to sell my business. Ask questions, learn what the business is worth, and then decide how to proceed. If the business is not worth as much as expected, keep it for a few more years to see what the market holds. Selling it at a low price is also an option.