What You Need to Understand About Working with a Business Broker

business broker San DiegoA business broker San Diego is constantly involved in the sale of businesses. This is his full time job. He gets paid on a commission once the sale is completed. All in all, there is more you need to understand about a business broker. In this post, we shall be taking a quick look at the essential points you need to understand about working with business brokers.

They are your representative
The mistake most people make is that of assuming that business brokers San Diego will take over the sale completely. That is not true. The work of a broker is to represent you. What this means is that he cannot make any major decisions without consulting you. With that in mind, when hiring a broker, you must not just focus on the financials. You need to find someone with good communication skills and someone you can be comfortable working with for months. The right broker should fit your personality, lifestyle and future exit strategy.

You can negotiate on the fees
Don’t settle for the fee that is described in the first offer. As aforementioned, a business broker will charge a commission. The commission can be as low as 5% or as high as 15%. You should note that these fees are not fixed. You can negotiate the fee to a more favorable one. All in all, you need to take note that not all brokers will be willing to negotiate. This is more so if they have a great reputation.

Other fees may be charged
Although most brokers will charge you a commission which is a percentage of the selling price, other fees may be required. For example, a broker may ask you to pay an upfront fee. This is meant to show commitment and to pay for the initial expenses which include advertising and business valuation. Steer clear of brokers who ask for a huge upfront fee.

Due diligence on your part is paramount
Business brokers San Diego will not have all the answers. It is up to you to do your own research about selling a business. The more you know the harder it will be for you to be exploited. Do not rely solely on the support you get from a business broker. There is no harm in involving an attorney and a CPA. Taking time to understand the process of selling a business will further give you some leverage when working with a business broker.

Every business broker San Diego is different. It is your job as the seller to learn more about a broker prior to hiring. It is further highly recommended to hire a local business broker because he understands your market better.

Business broker San Diego