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Can You Sell a Business Without a Broker?Brokers are not essential when completing the sale of your business, it is technically possible to sell your own business yourself and save the broker's fees. Much like selling you own house, or completing your own tax return, it is possible to do a D.I.Y. job on selling your business. If you want to you can complete the marketing, find the potential purchasers, walk 40-50 competitors, nosy parkers and "tyre kickers" though your accounts and business processes, handle the tax liabities, the accountancy and the legal aspects of sale yourself;... as well as running the business at the same time. Alternatively you can click here to find out what a broker will do. Business sellers will quite off have unrealistic expectations in regard to the value of their business. The amount of investment in time, money and effort over the years may not have increased the value of the business. The business is only worth what someone is prepared to pay for it. A broker will give a realistic market value based on the market value, not based on any mutiples of turnover or past history. Sellers always become emotional involved in the sale. It is their 'baby' that is being sold. Buyers sell the business as a commodity to be purchased. Like selling a house it no longer a home once you decide to sell, it is just bricks and motar. The worst fact of selling a business yourself is the breach of confidential and thrust with your stakeholders. Every Tom, Dick and Harry will now walk over your business. If not handled properly and professionally, your staff will leave, your suppliers will reduce their term, and your customers will seek other suppliers. Also during negotiations you will be at a disadvantage. The buyer will set the terms of any agreement. Your will swallow your pride and agree to what the buyer wants, and when he wants it. The process will very disintegrate and value of the business will continue to drop, and the buyer knows this. Even if you get legal and financial assistance from your solictor or accountant, they will bill you for these narrow professional service areas. Both of these are not skilled in selling negotiations, they will not provide you with the service you need. It is not unusual for may DIYers to take years to sell their business and alway at vastly lower price; it may cases it would have been better to wind up the business years previous. All of this time selling mean that the business is not being managed and very soon the business will suffer for this, and the owner takes his eye off the ball. Selling your business yourself is a a obvious option if you have a buyer in mind (such as an employee, relative or master franchiser) and are happy doing business on their terms, accepting their price and their time scale. The price in such deals is normally far below the market value, and the terms agreed are considerable less favourbly to the vendor. No one is doing you any favours in such a deal. Anywaywhether you hire a broker or not, you'll find yourself doing a lot of the selling work yourself anyway. Prospective buyers will have questions, and no one knows your business better than you. As a result, the buyer and seller of a business, unlike the buyer and seller of a house, will almost always meet. On the other hand, using a broker does offer several significant benefits. Having a broker manage the sale of your business allows you to keep the pending transaction under wraps. This can prevent potentially alienating your customer base, employees and other important business relationships. Using a broker can allow you to focus on running your business until the sale goes through, and can save you a lot of headaches. |
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