Business Brokers And Buyers – Business brokers provide services to buyers as their client. Upon signing a listing contract with the buyer wishing to acquire a business, the brokerage attempts to earn a commission by finding sellers for the buyer for the lowest possible price on the best terms for the buyer. To help accomplish this goal of finding sellers, a business brokerage and an M&A specialist commonly perform the following:

  • Ensures Confidentiality--Brokers have established systems in place to protect the confidentiality of a business.
  • Appraisals--Most business owners have no idea what their business is worth. Business Brokers and M&A specialist are trained in business valuation and can help business owners understand the true value of all their hard work and sacrifice.
  • Market Knowledge--Brokers and M&A specialist make their living selling businesses. They are in the market on a daily basis conversing with buyers. A local business broker understands the local market as well as what a business is worth.
  • Saves time and stress.
  • Listing the business for sale to the public, often on a Multiple Listing Service, in addition to marketing methods.
  • Based on the law in several states, providing the buyer with a business condition disclosure form, and other forms which may be needed.
  • Preparing necessary papers describing the business for advertising, pamphlets, tours, etc.
  • Advertising the business. Advertising is often the biggest outside expense in listing a business.
  • Being a contact person available to answer any questions about the business and to schedule showing appointments.
  • Ensuring buyers are pre-screened so that they are financially qualified to buy the business; the more highly financially qualified the buyer is, the more likely the closing will succeed.
  • Negotiating price on behalf of the buyers. The buyer's agent acts as a fiduciary for the buyer. By not being emotionally tied to the transaction, Business Brokers are in a position to more effectively negotiate on a Buyer's behalf. This may involve preparing a standard offer to purchase contract by filling in the blanks in the contract form.
  • In some cases, holding an earnest payment in escrow from the buyer(s) until the closing. In many states, the closing is the meeting between the buyer and seller where the business ownership is transferred and the businesses name is conveyed.

Business brokers attract prospective sellers in a variety of ways, including direct mail, listing on broker websites, listing on specialized global Multiple Listing Service websites and advertising in business periodicals. Using private databases, Brokers also approach known sellers and prospective sellers of similar businesses to assess interest.