Business brokers Orange County offer a service in exchange for a fee. Their service is listing your business, qualifying buyers, helping with business valuation and so much more. The services you get will depend on the broker you end up working with. All in all, there are a few points you need to understand about working with a business broker.
Commission
It is virtually general knowledge that a business broker Orange County gets paid on a commission. Typically, for the sale of a business, you will end up paying a commission of about 8% to 10% of the price the broker lists or sells your business. This percentage is not fixed. It can go down to 3% or higher than 12%. The percentage will all depend on the broker you are working with, the nature of your business and other factors. The point you need to understand is that the fee structure of brokers vary widely.
How fees are charged
Most people understand the commission. However, the aforementioned commissions are for the perfect world. There are other fees that come in. For example, you may have to pay the broker monthly fee which is on a sliding scale.
- No upfront fees
When working with aggressive business brokers Orange County, you never have to worry about upfront fees. However, with these brokers, you will not be able to negotiate on the commission. The reason for this is because these brokers operate on a no-sale-no-fee basis. If they don’t help you sell your business within a set period of time, you never pay them a single dime. The best thing, however, about working with these brokers is that their aggressive selling techniques tend to work well. You only need to sign the contract and the broker will take over the sale part.
Even so, it is important to understand that these brokers will not work for anyone. Their income is based on their ability to sell your business and for how much they get for it. If the selling price is too small or chances of selling your business are small, they will not work for you. If you plan on getting in business with a no-upfront fee business broker Orange County, you have to be very careful before signing the contract.
- Retainer required
There are other Orange County business brokers that will require you to pay a retainer. These are mostly brokers who handle larger companies. The retainer is meant to meet the cost of market research, preparation for business exit and other things that need to be done before listing the company. The preparation may take weeks hence the broker will not settle for the success fee alone. The bigger the company is the bigger the retainer will be.
Prior to hiring a business broker Orange County, it is good to note that not all of them will deliver value for your money. You have to hire with care. Pick someone you can count on; someone with a proven track record.