» Business Broker http://www.nyscclv.org Tue, 24 Jan 2012 05:06:53 +0000 en hourly 1 Business Brokerages http://www.nyscclv.org/business-brokerages/ http://www.nyscclv.org/business-brokerages/#comments Wed, 13 May 2009 03:41:05 +0000 nyscc http://www.nyscclv.org/?p=272 Business Brokerages Business BrokeragesAnne Brown asked:
What can I expect when dealing with them?Many people don’t have a clear idea of what business brokerages can do for them, yet they play a crucial role for many business owners and prospective buyers looking to sell or buy.  Buying or selling a business takes a very unique, specialized skill-set that does require a professional that focuses on business sales transaction.  All too often, people make the mistake of confusing the role of a real estate agent to that of a professional business intermediary.  This article will quickly examine the role of business brokerages and how the service of a business sales specialist differs from that of a real estate agent.

The role of Business Brokerages

For a business seller, the expectations for a professional business intermediary  are many.  They are required to assist the seller prepare their business for sale, help determine a selling price, prepare an information package on the business, advertise the business (while maintaining confidentiality of the sale), find potential buyers – and screen & qualify them.  They must show the business to buyers.  Facilitate communication between the buyer and seller and ensure that there are no missteps on this front, which often happen.
They must go over conditional offers with a seller and facilitate the negotiation process.  Next comes due diligence, which for a business can be lengthy and complicated if not facilitated smoothly.  Finally, the closing of the business is carefully monitored by business brokerages to ensure a smooth transition of ownership.  Bear in mind that this is merely a (very) high level overview of what is done for the business seller.  Remember that this process can be repeated several times until a buyer is found that actually goes all the way to the end of the purchase (i.e. does not back away).  Selling a business is usually a longer process than selling a piece of real estate as well.For the business buyer, business brokerages offer many benefits.  They assist with sourcing good businesses for sale, present different options, show different opportunities and help buyers with a purchase offer.  A professional business broker will remain engaged in the process through the conditional offer period, due diligence, waiving of conditions right through to the closing.  Commissions are paid by the seller – there is no direct out of pocket cost to the business buyer when dealing with business brokerages to buy a small business.

Work with a specialist

Business brokerages specialize in the buying and selling of businesses.  Real estate agents focus on the buying and selling of real estate.  There is a major difference and a completely different skill-set involved.  A professional business intermediary must have the expertise in business valuation, financial statement analysis, valuing intangible assets, how to buy and sell business, deeper exposure to laws governing business sales, equipment & premises lease issues, franchise agreements, employee issues pertaining to a business sale, and so on.  Selling real estate is different on a fundamental level.  Business brokerages have professionals with the experience to sell your business properly.  A business is a major investment – dealing with an expert is a wise decision.  There are good business brokers in Canada and Ontario specifically – give us a call to see what we can do for you.

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]]> http://www.nyscclv.org/business-brokerages/feed/ 0 Business Brokers http://www.nyscclv.org/business-brokers/ http://www.nyscclv.org/business-brokers/#comments Thu, 07 May 2009 23:35:48 +0000 nyscc http://www.nyscclv.org/?p=276 Business Brokers Business BrokersExpectations as a Business Seller

When you deal with business brokers to help you sell your business there are a few things to keep in mind.  You should have some expectations of what business brokers can do for you and what skills they can bring to the table to help you find the right buyer.

One of the main questions you need to ask business brokers is how they will help you prepare your business to be sold?  Will they be able to indicate to you certain actions you can take immediately to help your business shine in the eyes of a buyer?   For instance, can they advise you on how your shop presents?  Perhaps some quick improvements or changes can be made.

They can let you know some of the common questions that are asked by business buyers to help you anticipate what information you will need to prepare.  Example – do you have your financial information in order, have you retained the services of an accountant and lawyer to help guide you through the process and so on.  Experienced business brokers can point out some of the quicker issues that can be resolved immediately before you start meeting buyers.

Business brokers can also help you establish a selling price for your business.  They can guide you through the methodology to derive a fair price.  There are different business valuation techniques that can be used – earnings multiples, asset-based valuation, discounted futures cashflow method, etc.  While you may not need to know the ‘nuts and bolts’ of these techniques used to value a business, good business brokers should make you understand the logic and though process used to determine a selling price.  Also, don’t merely rely on the value a business broker may help you derive.  Talk to your accountant or a business valuator – a good broker should have no problem if you decide to do this.  If they do, then that can be a red flag.

Good business brokers will maintain the confidentiality of the business sale while they find you a good buyer.  Selling a business is a much different process than selling real estate and reputable business brokers should be able to keep your confidentiality intact.

A business broker will help you present your business to business buyers.  They will assist in the communication process and ensure that there is full transparency on the part of the buyer and seller of the company.  Business brokers will be the go-between to ensure no misunderstandings and to make sure all questions are answered. A business broker will also help in the negotiation between the buyer and seller and properly present the offer to purchases as well as subsequent counter-offers, etc.

During the due diligence process, business brokers can be good intermediaries as well.  Selling a business requires that buyers confirm facts and do a thorough examination of the business.  This can be a lengthy process and complicated or, with the services of competent business brokers, be much smoother and less difficult.  Many deals are lost during due diligence that ultimately resulted in flared passions and misunderstandings.   A business intermediary can help mitigate this. Please remember that selling a business is a completely different process from selling real estate.  Competent busies brokers are trained and licensed professionals that will help you ultimately realize your business sale, which is the ultimate goal.

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