What To Expect from a Business Broker
There are many options to considering when hiring a Business Broker or third party to represent you in a transaction, whether you are buying or selling a business. This applies whether you are buying or selling a business in Sacramento, California, or anywhere else in the United States.
To help you make the right decision, consider the following.
1. Trust and Ethics.
When selling your business you want to feel assured the Business Broker or Sales Agent has a strong commitment to trust and ethics so you know your business and its interests are fully protected. Getting an ethical and trust commitment from your Business Broker or Sales Agent is the most important ingredient. It is critical and should be non-negotiable.
2. Real Estate License
Many states in the US require a Business Broker or Sales Agent to hold a real estate license in order to represent an owner of property in a sale and be paid for providing that service. In California, a license is issued by the California Department of Real Estate for two types of persons: Brokers and Sales Agents. A Broker can either work for themselves or choose to hire Sales Agents that work under them.
If you are considering hiring a Broker or Sales Agent, make sure the license they hold is current. For California, this can be checked at the Department of Real Estate website at California Dept of Real Estate website. Click “Real Estate License Lookup” and you can then search by the first and/or the last name of the Business Broker or Sales Agent to see if they hold a license.
Does the Business Broker or Sales Agent you are considering hiring specialize in residential sales, commercial real estate transactions, mortgages, business opportunities or a mix? Because of the complexities of the different markets, most Brokers or Sales Agents tend to specialize in one area only. Even within these broad specializations, there are specialists, for example, in transactions greater than $5,000,000 (called M&A transactions); there are also Business Brokers or Sales Agents that specialize in smaller businesses or Main Street transactions.
Has the Business Broker or Sales Agent owned and operated a small business? Small business ownership teaches many skills and requires a unique understanding of what’s involved in owning and operating a small business. When detailed negotiations take place between the business owner and a potential buyer, all the options must be explored and fully considered and understood.
Does the Business Broker or Sales Agent have formal training or education to support the service they provide?
There are different types of accreditations, including the Certified Business Intermediary (CBI) from the International Business Brokers Association and the Certified Business Broker (CBB) from the California Association of Business Brokers.
If you’d like more information please feel free to get in touch with me for a quick consultation. We’ll discuss your particular business, what’s important to you and make a plan for those first few steps.