When evaluating various M&A professionals and business brokers, ensure that you have complete answers to all your questions. Your evaluation becomes ever so more important to selecting the right individual.
CREDENTIALS
- Is he/she a business broker/ Business Intermediary, or merely a real estate broker peddling businesses?
- Is he/she affiliated with key business brokerage organizations?
- Does the professional have a financial education, is he familiar with tax issues?
- Is the broker/ Business Intermediary the principal, or simply an employee with little vested interest?
- Other than the brokerage business/ Business Intermediary, has the broker/ Business Intermediary run an own business before and thus, can relate to your concerns?
VALUE OF YOUR BUSINESS
- How does the professional 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/ Business Intermediary ensure confidentiality of your business?
- What is the buyer qualification process? In writing?
- Can the professional show you specific documents?
- Will you be protected from unqualified “tire kickers” and “wanna-be” buyers?
UPFRONT FEES/ RETAINER
- Is the broker/ Business Intermediary confident in selling your business
- Does the broker/ Business Intermediary charge advertising, traveling or any other costs?
- How much is the professional at risk with his efforts?
MARKETING
- How will the firm attract buyers for you?
- Can he/she show you a marketing plan?
- Does your broker/ Business Intermediary share commissions outside of a network?
- Does the broker/ Business Intermediary have international experience to attract foreign buyers?
