If you are thinking of selling a business, here are the top 7 risks of not using a broker to sell your business. Find out what your business is really worth.
7 Risks of Not Using a Broker to Sell Your Business
Sure, you can sell a used car on Craigslist. You may even be able to sell your home. But successfully selling a business yourself has some risky downsides. Here, are the most common 7 deadly sins, so that you have a better understanding of what a broker can bring to the table, and avoid the risks of not using a broker to sell your business.
7 Deadly Risks of Not Using a Broker to Sell Your Business
#1 Proper Valuation
There is no doubt that right out of the gate, a business broker can and will, provide a proper business valuation. Most business owners will either price there business too high or too low. It’s human nature to want the most for your blood, sweat and tears over the years, but a valuation from an experienced third party using accepted accounting practices is invaluable. Alternatively, a motivated seller may price their business too low, leaving a significant amount of money on the table. By hiring a business broker, you can rest assured you are getting a realistic and fair business valuation.
#2 Masters of Confidentiality
If you sell a car or home, people have to know about it. You have to advertise. But ask yourself, what if my valued employees do when they find out I am checking out? The chatter in the break-room explodes. There are many reasons why strict confidentiality is important when selling a business. Your key employees may become nervous about job security, your clients may perceive that you are selling for a negative reason, your suppliers may become nervous about being paid, and worse, your competition may sabotage you by putting a negative spin on it. When using a broker, each and every person that inquires about your business will be required to comply with strict Confidentiality and Non-Disclosure Agreements that ensure you the utmost in privacy.
#3 Qualified Buyers
More important than finding a buyer for your business is finding enough qualified buyers. Finding a buyer that will be a suitable match with your industry and business is a top priority. And you should never settle for the first buyer that walks in off the street. You’ve invested many years in building your company. Take the time to get professional advice and sell it for it’s full value.
#4 Shorten the Sales Cycle
When you’ve made the decision to sell, you should know that doing it yourself takes time and lots of it. A business broker has the proper experience, skills and transaction knowledge to minimize the time required to sell your business. You only have but one opportunity to set a proper price, roll out your marketing, and attract the best qualified buyers. This is not the time nor the place for a “do it yourself” approach with the bulk of your net worth hanging in the balance.
#5 Avoid the Distractions
Now is not the time for you to begin to learn the in-and-outs of selling a business. That is best left to someone that does it for a living. And now is when you cannot be distracted. At all. It’s important that you continue to run your business as if you’ll be owning it for another 10 years. When you utilize a business broker to sell your business, it affords you with more time and energy to properly run your business at a time when the business should be at its very best.
#6 Transaction Expertise
It’s not always the price. Often the structure of the transaction is critical to sealing the deal and the complexity of transactions can be challenging for even the most seasoned business owner. A business broker is a priceless partner that can help you avoid the pitfalls, increase the odds of success and manage the entire transaction process smoothly. Additionally, and this is important, a business broker can find financing fast to help close a deal!
#7 Third-Party Objectivity
Even the most level-headed business owner will find it extremely challenging to remain objective when evaluating or dealing with matters concerning their business. During negotiations, a professional intermediary can be that buffer and sounding board that allows you to make wiser choices and negotiate a purchase agreement the works best for you.