If you’re in Singapore, you can either sell your business on your own or hire a broker. There are many business broker services in Singapore that can help you gain access to a large pool of buyers and be able to sell your business at the right price.
Brokers for business helps match sellers and buyers. They speed up the selling process for sellers while they provide buyers the business that matches their passion, price, location, and industry.
Getting the right broker is essential to successfully sell your business. Here are some tips that you can follow to connect with the best brokers for business:
One important aspect of choosing a broker is credentials. They need to be a member of an association that makes them a legit service. Since associations uphold strict ethical standards and code of conduct, you should ensure that they are a member of an association.
The International Business Brokers Association (IBBA) is the biggest community of professionals in the Business Broker community. You should deal with an IBBA member who can help you in the selling and buying process. You can also look for brokers who are a member of M&A Source.
Professionals who have Certified Business Intermediary (CBI) designation have the highest standards of education, ethics, and professionalism. You should also find brokers who are accredited as a Certified Business Intermediary as they have gone through extensive training on business sales.
Lastly, they should be a member of State or regional Business Broker Associations of the Chamber of Commerce.
2. Business Selling Experience.
Another factor that you should consider is the broker’s business selling experience. Although many brokers in Singapore have years of experience, you should look for brokers who have relevant experience in selling a business in the local market or industry.
If you are in the hospitality industry, you should find brokers who have expertise and experience in selling businesses under this industry for the last two or three years. Make a comparison of brokers and choose the one with the highest successful sale transactions.
Ideally, you should work with a broker who has a track of history in your field. The majority of brokers are licensed realtors. If your business involves the sale of buildings or property, you should hire a broker who is also a licensed realtor.
3. Broker Market Listings.
You need to consider how a broker will market your business. It’s very important that you choose a broker that has expertise in managing a professionally made marketing program.
Ask the broker how they will promote your business for sale. Brokers usually post an ad on the brokerage site. Ask them where else and how they will advertise your business.
Ask which online business-for-sale listing sites they will use. Are they providing classified print ads for your business?
You should also ask for a selling book or memorandum. It is the document that they show prospective buyers when selling a business.
4. Buyer’s Database.
You should consider how big their buyer’s database is. Consider working with a broker that has wide connections and established relationships with possible buyers.
Check if they have connections with popular entrepreneurs, private equity groups, and contacts in related fields. Ideally, they must have a database of 10, 000 to 25, 000 potential buyers.
If they have a huge database of potential buyers, they can quickly sell your business to buyers who are really serious about buying your business. The easier they can negotiate on terms and selling price.
Brokers make money by getting a commission on every business sold. The common commission is 10 percent.
If a broker asks for upfront fees, it’s a red flag for you. It’s not common for them to ask for upfront fees. The commission is paid at closing.
Some brokers don’t ask for anything unless they sold a business. It’s because they believe that the business is worth taking the risk since it has the potential to be sold.
Like any other business, you should check the broker’s reviews and testimonials. It’s one way to ensure that you’re dealing with reputable brokers.
You can also request a list of their successful clients (sellers) who have sold their business in the last six months. If possible, ask for their names and contact numbers.
You want to hire the service of a broker that has a positive track of record in the brokerage industry. As much as possible, check if they have been sued by sellers or buyers in the past. It should give you a hint that you’re dealing with the proper business broker.