Mergers and acquisitions happen at all levels of businesses. Businesses are always starting, or their owners are looking to sell them. There are many reasons behind this, including a preplanned exit strategy or low sales volume. When selling, entrepreneurs may seek assistance from a business broker.
Sometimes called a business advisor, this person is responsible for helping with the negotiations, documentation, and finding a buyer for the business. It’s not easy to become a successful business advisor. Among other things, this job requires experience in running a business, or a proven track record of selling a company.
Tasks and Responsibilities
The role of a business broker starts with a discussion with the business owner. He has to have permission from the owner to represent him in the sale. This representation is limited to finding a buyer and working with the buyer and seller in ironing out the deal.
At the same time, the broker has to prescreen the buyer for fitness in running the business. He should also prescreen the business for the buyer. This matching for fitness makes the deal enticing for the buyer. It’s the broker’s job to keep both parties interested in the transaction.
The sales process starts when both parties start talking about the price. Both parties discuss not only the price, but also other items, including the furnishings, and questions of timing for the change of ownership. Like any other broker, he is also responsible for documentation and paperwork.
Determination and Patience
The broker must have patience. Perseverance, determination, and patience go hand in hand during the negotiations. The broker has to keep both parties at the table and talking about making a deal. The broker has to filter the buyer, making sure that he has the resources for the purchase. In some instances, the broker might need to talk to the bank to help finance the purchase.
Buying a business is not much different from buying property. However, the buyer must be knowledgeable about the business’ product or service.