Finding the best business broker in Melbourne can be challenging, especially if you have never used one before. With so many business brokers claiming to offer the best services, it can be hard to cut through the noise and find one that works for you. It’s why we are here today with our guide that walks you through every consideration you should make when choosing a business broker in Melbourne. Using this guide, you can easily narrow your search and find a reputable broker that will help sell your business.
Check their insurance and license
First, verify that the business broker holds the correct insurance and license. Business brokers in Australia are required to be insured and licensed, as well as be members of industry associations, such as the Australian Institute of Business Brokers (AIBB). Information about a broker’s license should be listed on their website, or you can ask them directly.
Reputable brokers will usually provide you with a copy of their membership with associations and their insurance, so don’t worry about asking for this information. It is essential to have one as it provides you with protection and ensures you can hold them accountable should anything go wrong. You should not move forward with a business broker who withholds their insurance and license details.
Determine what their fees include
Before moving forward with a business broker, it’s essential to understand what you are paying for. Ask them or check their website to see what is included in their fee and if there will be any additional costs if you sell your business through them. Most brokers will be clear with their fee and what is included, to help you decide if they are right for you.
Ideally, look for a broker whose fee includes everything, reducing the chance of hidden surprises when you close the sale of your business. Commission and advertising fees are often added on, so be sure to ask your broker about these. If the fee they offer is not inclusive of every cost, ask them about any additional fees you can expect. Doing so will help you budget for your broker fees and determine if they are an affordable option for you or not.
Ask for a valuation
Before moving forward with a business broker, ask them for a valuation of your business to see what they think it’s worth. Most reputable business brokers will provide you with an estimated valuation of your business, explaining the methodology used to determine this price.
You can use their valuation and justification of it to see if they are honest about the price you can achieve, or if they have inflated the price to secure your business. Your business broker should offer you a realistic price for your business, managing your expectations from the get-go.
Learn about their previous selling history
Alongside your valuation, you want to see proof of your business broker’s success. Asking for their selling history allows you to see how many businesses they have sold in recent years, and whether any of them are in your same industry. You can also ask for their list-to-sale ratio, which shows you if businesses are selling or if the broker is collecting a listing fee and not attempting to sell the businesses.
Reputable business brokers will be happy to share this information with you and include success stories of businesses sold. Many will list this information on their website as one of their selling points, too, allowing you to easily see how many businesses they have sold in recent months and years.
Ask for examples
After being told about their previous selling history, you can ask for examples of businesses they have sold to. Ideally, you want these to be in the same industry as yours, so you can see what types of businesses they have sold and how much they have sold for. Not only can this provide you with a better idea of the price, but it is also more likely that your business broker will have potential buyers they can contact who might be interested in your business, thereby speeding up the sale.
Learn about their marketing plan
A business broker needs a robust marketing plan to ensure that your business gets the attention it deserves and attracts lots of potential buyers. It’s worth asking them about this plan to see how they plan to list and advertise your business. A good business broker will have a well-thought-out marketing strategy, covering an online marketing approach and directly reaching out to others in your industry. You can ask your broker about their market plan for your business, or examples of other businesses in your industry that they have sold.
Test communication
You also want to test their communication to ensure they will reply promptly and with the information you need while you work with them. Often, business brokers will respond instantly to reassure you, then, as soon as you have paid, turn silent and find it difficult to get hold of them. To see if their communication is genuine or not, ask a friend or family member to contact the business broker. They can enquire about a business listing to see how fast they are at responding, and how helpful they are too.
Find your business broker in Melbourne today
By using our guide, you can easily find a business broker that is right for you. When carrying out your search, we recommend considering Lloyds Brokers. Based in Melbourne, they are a team of experienced brokers who can help you sell your business with ease. Reach out to Lloyds to discuss the points we have raised today and find the perfect Melbourne business broker services for you!
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