GlobalBX

Who are the primary players you need when selling your business. Just like in sports, the players on your team will make a big difference on whether you win or lose. If you were putting together a baseball team, you would not draft Wayne Gretzky to be your pitcher just because he has a well know name in sports. The same is true when building a team to help you sell your business. There are some important players you are going to need:

•  Attorney: Make sure your attorney has experience in business transactions. Even if an attorney has a well known name such as F. Lee Baily, Robert Shapiro, or Alan Dershowitz, that does not mean they are going to have the expertise you need for your transaction. You should interview several attorneys before making a decision. Find out how much experience they have in business sales transactions. Ask if they have worked on transactions similar to yours. Also, find out how much they think it is going to cost for their services. I have seen a lot of attorney’s create documents that are much “thicker” than necessary at a high cost to the client. Good sources for attorney referrals with an expertise in business transactions are: escrow officers that specialize in bulk sales; business brokers; and former business owners that have sold their business.

•  Accountant: Just like with the attorney you choose, you need to make sure you are using an accountant with an expertise in business sales transactions. You may know an accountant who is great at preparing a tax return, but that does not mean they will understand the intricacies of a business sale. Using the wrong accountant can literally costs you thousands of dollars. The above mentioned referral sources in the attorney section would also be good for finding an experienced accountant.

•  Business Broker or Business Intermediary: When choosing a business broker, you want to make sure that they have specialized training in business sales. Also, it is important that the brokers primary business is business sales, not a real estate agent that also sometimes sell businesses. Discount brokers are also a red flag when choosing someone to represent you. Business brokers only have a limited amount of funds to advertise a business. When using a discount broker there is usually less money available for marketing, and/or the broker is only going to promote businesses they negotiated a higher rate with. Also, many brokers charge an upfront fee. However, I am a firm believer that a broker should only get paid if they close a deal. Paying an upfront fee takes away the motivation for the broker. Finally, choose a brokerage company that is not just a “listing machine”, that signs up as many business as possible to represent knowing they will only be able to sell a limited amount of them. When a company has more then 7 -10 listings per agent, they are not able to give the attention necessary to effectively represent the business.