12 Frequently Asked Questions When Selling Your Business.

July 25, 2023

FAQ image with business owners

  1. What does a business broker do? A business broker is a professional who assists in the buying and selling of businesses. We help business owners accurately value their business, identify potential buyers, oversee negotiations, and guide the business through the transaction process. We function as a buffer between the buyer and the seller, facilitating communication and ensuring the transaction goes as smoothly as possible. In certain States (Florida being one) a business broker must have a real estate license.
  2. When should I hire a business broker? You should hire a business broker when you are ready to sell your business and need assistance with the process. It is often beneficial to hire a broker early to help prepare your business for sale, which could involve improving financial performance, resolving any outstanding issues, and enhancing the overall attractiveness of your business to potential buyers.
  3. How do I choose the right business broker? Choose a business broker based on their experience, knowledge of your industry, proven track record, and how comfortable you feel with them.
  4. How much do you charge? We typically charge a commission as a percentage of the selling price of the business. This can vary based on the complexity of the sale and the value of the business. At our first meeting we will be happy to give you an estimate of our fees.
  5. How is my business valued? Quorum Business Advisors offers appraisals by certified business appraisers for you can feel confident your business is valued accurately. We use several methods to value a business, including the asset approach, the income approach, and the market approach. The chosen method will depend on the nature of your business. We will also consider factors like the financial health of the business, the industry, the economic climate, and recent sales of similar businesses.
  6. How long will it take to sell my business? The timeline can vary greatly, but on average, it takes six to nine months to sell a small business. However, it could take longer for larger or more complex businesses. Factors like the asking price, the condition of the business, and the market conditions can all impact the timeline.
  7. How will you find potential buyers? We use a range of methods to find potential buyers. These include advertising on business-for-sale websites, leveraging our network of contacts, and using targeted marketing strategies. We also vet potential buyers to ensure they have the necessary financial resources.
  8. Will the sale of my business be kept confidential? Yes, at Quorum Business Advisors we fully understand the importance of confidentiality in business sales. Bad things can happen if word leaks out prematurely to customers, employees, vendors, and competitors. We typically require potential buyers to sign a non-disclosure agreement (NDA) before we share any information about your business.
  9. What information do I need to provide to sell my business? You will need to provide detailed information about your business, including financial records, details of assets and liabilities, information on employees and contracts, and details of your operations. We typically look back 3 years. At our initial meeting we will provide you with a list of documents needed.
  10. What can I do to make my business more attractive to buyers? Improving financial performance, resolving any outstanding legal issues, maintaining a strong customer base, and ensuring your operations are running smoothly can all make your business more attractive to buyers. Buyers in particular want to know that the operation of the business will not be negatively affected by the change of ownership.
  11. What role do I play once the business is on the market? After listing your business, you will continue running it to ensure its value does not decrease. It is important to keep your focus on the business and run it as you normally would. We will need your ongoing assistance in providing requested information, meeting with potential buyers, and working with your accountant or lawyer as needed.
  12. What happens after my business is sold? After the sale, there is typically a transition period where you help the new owner understand the business. The specifics will be outlined in your sale/purchase agreement. After this, you are typically free to pursue other interests. However, most agreements will include a non-compete clause so you will need to be mindful of that.

At Quorum Business Advisors we have over 15 years in the industry. We are a member of the Business Brokers of Florida (BBF), International Business Brokers Association (IBBA) and hold a number of prestigious accreditations. With Quorum you will be in safe hands.
For a free consultation contact us today.