How To Sell Your Business
I am starting a new business, going to help people sell their own houses, been a realtor for 17 years?
There has been alot of people that have been laid off in my community, and i hear how tired they r of paying commissions and that they need every cent they get from their homes to move out to alberta, I'm also tired of other realtors having no ethics, they do not care about the people they deal with, they only care about the money they r getting from them, I feel like a trader, but I have been watching and listening to people out there, saying they r tired of paying so much commission to realtors, but honestly if u take the time, its easy enought to sell your house on your own, just need some direction, that is where i would come in, to show how its done, just looking for $699 far lot less than what a realtor would be getting, what do you think of the idea, also need a name for the business thanks for your imput
What you are talking about is already being done quite a bit. It is called many things. Here in Atlanta there are lots of Brokers who offer this "fee for service" one time payment of usually around $500 just to list the house. They are also called discount brokerages. But the owner will still probably have to pay a buyers agent anywhere from 2-4 percent.
The biggest problem I see in it is that they are paying upfront instead of for results. Also, buyers agents may shy away from these houses because they don't want to do twice the work. Other than that it has been a fairly popular concept that I see growing in the future. If I were you I would check around and see if anyone in your area is already doing it. You still have to be a licensed agent to do what you're wanting to do, maybe even a broker (if you can't find one who would be willing to support your venture).
Merger and Acquisition Advisor or Business Broker – Which One Do you Need in Order to Sell your Business?
Most businessmen sell a business only once or twice in their lifetime. Selling a business may be the most difficult task for a businessman who might have taken years to build a profitable and reputable business. When he puts it up for sale, he hopes to recover the price for all that he has put into it. Selling a business can be profitable decision or one that can result in the loss of one’s life’s work. It is advisable for businessmen to hire professionals for selling their business. If your business falls into the mid-market category and you aim to drive a strategic deal out of your sale, you will require an expert merger and acquisition advisor. But if your business belongs to the Main Street and you just want to get the best price for it, you might need a business broker. Below, we discuss some of the differences between the two professionals, which can help one decide whom to hire for selling a business.
• Type of Business
Business brokers specialize in what are called main street businesses, which could be in the range of $100,000 to 1,000,000 in revenues and include businesses like restaurants, dry cleaners, gas stations, convenience stores etc. M&A advisors usually take on businesses with larger turnover, like manufacturing units, technology firms, distributors etc. If the business to be sold is amongst main street businesses, the services of a business broker to sell the business would be appropriate, whereas if it is larger, then the services of a merger and acquisition advisor would be needed.
• Targeted Buyer
Business brokers target individual businessmen for selling a business, whereas M&A advisors are connected with corporate buyers, who seek a strategic reason behind a merger or an acquisition.
• Business Valuation
Business brokers generally apply “rule of the thumb” valuations for main street businesses to determine their selling price. Such valuations rarely vary. Merger and acquisition advisors are called in when there can be a broad interpretation of strategic value and rules of thumb do not apply. Large businesses generally have high components of niche services, intellectual properties, strong customer base etc, which make the strategic value for the business vary widely.
• Complexity of Transaction
Business brokers handle small businesses to sell and their clients consist of individuals. The process of selling the business is simpler as compared to larger corporations. Contracts for small businesses are straightforward and negotiations are based on the requirements of the seller, price and financing. For a merger and acquisition advisor, the target is a corporate buyer, who is an expert at M&A deals. Corporate buyers have different teams working for them like legal experts, investment bankers, valuation professionals etc. and their contracts are extremely complex. A corporate buyer sends in teams to conduct due diligence and examine the business to sell in detail. Hence if the business to sell is a large corporation, the seller will need a merger and acquisition advisor, who is equipped and experienced to negotiate with such pros.
• Volume of Clients
Business brokers represent as many businesses for sale as they can. For business brokers, it is a benefit to have many businesses listed with them when they are contacting individual buyers. Business brokers rely on mass email a campaign, posting on websites etc. and their attention is divided amongst many clients at one point of time. Merger and acquisition advisors, on the other hand, have an exclusive clientele of 3 to 4 clients per professional. With specific industry niches and a customized database of contacts, merger and acquisition advisors give their clients the personal and professional touch that they demand.
• Fees
Business brokers have a system of a minimum upfront fee plus around 10% of the transaction fee on completion of a successful deal. They do not charge monthly fees. Merger and acquisition advisors, on the other hand, charge a substantial upfront fee or a monthly fee in the range of $3000 to $10,000 per month. M&A advisors also charge a percentage of transaction value as fees on completion of the deal, which is decided on basis of the size of the business. Big Wall Street M&A companies are known to refuse transactions below $1 million in fees.
Based on the points made above, you can decide whether to hire a business broker or an M&A advisor for selling your business. The major deciding factor will be the cost that you are willing to incur. Keep in mind that if you have a small business to sell, it will not be able to sustain substantial upfront as well as monthly fees of the merger and acquisition advisor. Hence it would be better to go for a business broker. Go for a merger and acquisition advisor only if you need to sell a large corporation with high intellectual property and niche services.
About the Author
For more tips on selling a business or if planning to sell a business, check out tips of business for sale and business valuation. Find expert business brokers and mergers and acquisitions for investment banking services in USA.
How You Sell Your Business and Price
