8 Questions to Ask Before Hiring a Business Broker

December 2022

Hiring a business broker is the best way to sell your business in Las Vegas. A professional broker makes life easier with many benefits during this challenging phase.

First Choice Business Brokers offers these questions to help you choose the business broker that's right for you.

How experienced is the broker at business negotiations?

Certified Brokers know the sales process well, but negotiation expertise comes with practice. The more experience your broker has in successful negotiation, the more likely you will get a favorable sales agreement.

An experienced broker has been involved in similar negotiations dozens of times before and has developed a successful strategy to leverage the valuation and market position to support the asking price during negotiations.

What is your valuation process?

A business valuation is a process of determining the economic value of a business. All areas are analyzed to assess their worth.

● Business valuation determines the economic value of a business.
● Business valuation is used to determine a fair value for the purpose of selling, establishing partner ownership, assessing taxation, and even divorce proceedings.
● Several methods of valuing a business exist.

Most business brokers have developed a tailored approach that combines several valuation methods they find successful and compatible to their sales strategy. 

When you ask about the valuation process, the reply should be clear, credible, and easy to understand.

Have you worked with businesses like ours?

When selling a business, familiarity within the niche is a huge advantage. You want an agency that knows how to navigate the market in your domain. This level of understanding can help them raise your business price, netting you more profit during the sale.

Consider all options before choosing a business broker. Selling strategies will differ for a brick-and-mortar or an internet business. An agency that knows how your business works can save both parties a lot of time.

Do you have a pool of qualified buyers?

Choose a business broker with a pool of buyers. A vast network of good leads gives a significant advantage over other brokers when selling a business. Quickly finding the right buyer will make the sale process successful.

The quality of leads a business broker has is proportional to the offers you get for your business. The more potential buyers they have from your industry, the better market value for you.

How much do you charge for your time?

Financials are an integral part of the engagement process when hiring a broker. Knowing how much the sales process will cost helps you plan and determine if the broker's services are worth the price. This question will be even more relevant if you're a small business with smaller margins.

Setting the expectations early when it comes to pricing allows for the rest of the process to go about smoothly. Getting the finances out of the way as soon as possible is a good idea. Ideally, discuss costs before the engagement is finalized.

Can you explain your pricing?

Most business brokers have a breakdown of their pricing, which is easy to understand. If you are unclear at any point, they should be able to explain, so you know how they charge for their services. A business broker should offer a realistic pricing plan.

What are the next steps after engaging you?

An experienced brokerage has the sales process laid out in detail. So this question is to help you understand their strategy for your business sale.

Their answer should include;

● Confidentiality
● Preparing for the sale
● Completing the valuation
● Finding a buyer
● Negotiating
● Legal transactions and closing
● Transitioning to the new owner

Do you have professionals to verify documentation?

Legal documentation and transactions take place in every business sale. You may have these services already, but if not, a good broker has access to the following:

● M & A Lawyers
● Bankers or other lenders
● Certified Accountants
● Real estate agents
● Insurance brokers

FCBB has access to these professionals in Las Vegas for all our clients. We ensure that professionals provide legal documents and transactions. You will have peace of mind when you work with FCBB to sell your business.

First Choice Business Brokers are your best choice if you're a business owner looking to sell in Las Vegas. We help business owners like yourself with a great sales experience and transition to the next phase of your life.