Understanding the Role of Business Brokers when Purchasing a Business


Using business brokers to do the hard work can help at times, but they also have their drawbacks. There are some good services business brokers can provide, but don’t confuse using one with hiring one. Brokers don’t work for buyers; they either represent the seller or the deal. They are not trusted, unbiased advisors for the buyer unless they have been engaged by them exclusively and not being paid by the seller.

A common misconception about business brokers is that many relate to them as they would real estate agents. They go into the process thinking a business broker is going to deal with them as a buyer broker, as a real estate agent deals with a homebuyer.

Brokers can help you locate businesses, be a buffer between parties, and assist in putting the deal together. They will not represent your interest or negotiate you deal, or do your work. They will not take you to visit thirty businesses like a real estate agent will with houses.

With so many buyers and few sellers, brokers compete for getting as many listings as they can, good and bad. “There’s a buyer for every business”, in their mind, so business brokerage is a quantity, not a quality oriented business. About 90% of the listings online are controlled by brokers. Business brokers only sell about 4% of the small businesses that change hands each year. They’ll often represent selling more, but studies have shown the number closer to 4%. Eighty percent of online listings never sell.

To get a broker to point out the best businesses for you, it is important to demonstrate to a broker that you are serious about buying a business and you’re ready to buy immediately, should the right opportunity present itself. A business broker’s only asset is their time; they do not want to waste it. They leverage their time most effectively with having many listings and being able to sell them quickly. Impress the broker as a serious buyer to get them to choose you, over hundreds of other buyers, to show the premium listings to.

---------------------------------------------------------------------------------------------------------
Now I would like to share with you what a Billionaire once told a friend of mine. Who immediately put what he learned to use and went from Bankruptcy to Multi-Millionaire in just a few short years. Discover how to do that for yourself. Listen to the whole story here! ==> http://www.successinsiders.com/home.html

This article is derived from an interview between Lance Hood from SuccessInsiders.com and top business buying expert Richard Parker.

From Lance Hood – SuccessInsiders.com



Research, Investment, Buying Business, Business Brokers, Chambers of Commerce, Making Money, Wealth, Business Skills