Broker Selection

When evaluating various business brokers, ensure that you have a complete answer to all your questions. New Jersey remains a State with no regulation or licensing required to be a business broker, thus, your evaluation becomes ever so more important to selecting the right individual.

Credentials

Is he/she a business broker, or merely a real estate broker peddling in businesses?

Is he/she affiliated with key business brokerage organizations?

What is the educational background of the broker? Verifiable?

Does the broker have a financial education, is he familiar with tax issues?

How long has the broker been in business?

Is the broker the principal, or simply an employee with little vested interest?

Other than the brokerage business, has the broker run an own business before and thus, can relate to your concerns?

Value of Your Business

How does the broker plan to establish the value of your business?

Does he work with reputable valuation firms?

Is the valuation simply an in-house computer estimate (with a large upfront fee)?

Can he show valuation samples, and how do they relate to your business?

Will the valuation firm “stand behind” the appraisal if need be?

Will there be a “free update” of the valuation in a year from now, if needed?

Confidentiality

How will the broker ensure confidentiality of your business?

What is the buyer qualification process? In writing?

Can the broker show you specific documents?

Will you be protected from unqualified “tire kickers” and “wanna-be” buyers?

Upfront Fees

Is the broker confident in selling your business or does he request an upfront fee?

Does the broker charge advertising, traveling or any other costs?

Is the broker’s work simply a performance based fee upon a closed deal?

How much is the broker at risk with his efforts?

Marketing

How will the broker attract buyers?

Can he/she show you a marketing plan?

Is he/she operating within a network or as sole practitioner?

Does your broker share commissions outside of a network?

Does the broker have international experience to attract foreign buyers?

These are all valid question you should raise when evaluating a broker. They are important in finding the right individual to work with you in obtaining your goals.

Prior Client Assignments