My family inherited a small business after the death of a parent and we have no interest in keeping it. It is profitable and has about 8 acres of property included with it. We really don't have an idea of where to start to begin the process of listing it for sale. Is it worth going through a small business broker?

You will get differing opinions on here about brokers. Real estate, business, and stock brokers. When younger, I believed in stock brokers but would have done fsbo for real estate and business. I have now flip flopped those beliefs.

Several older mentors told me brokers helped them improve the sale price of their businesses by 12-20 percent.

Business values have been at all time highs. I personally would look to a broker.

This advise could change depending on details. But that's my advise. Might try to give some details here for more suggestions. This board can be very helpful.

What kind of business?

The less I knew of the particular industry and the details about the company, the more help I would want to get to sell it. Out of curiosity what does this business do?

Knowing nothing else - start with major suppliers and customers. You can approach competitors. The accountant and or bankers familiar may be helpful. Don't undervalue a profitable business....

It is a towing business. It has a contract with local law enforcement and many gentlemen's agreements with local dealerships and repair shops.

We aren't really looking to owner finance with any current employees. The ideal situation would be to cash out on both the property and the business.

Sounds like a business broker might be a good fit then. I know one who works all over Texas and is very good if you need recs.

Chris:

I would be interested in the broker you recommend.

Please IM me

Thank you

I am interested in the contact info for your broker.

His name is Nathan Teinert with Texas Business Brokers. You can tell him Chris Field sent you. Phone number is 979-966-3775.

Thanks.

Don't business brokers charge 10% on the transaction value and you still need an attorney, CPA and other professionals to transact and advise on the sale?

I met with one before and seemed like total sham given the cost. Said even if a buyer/seller was already lined up they would still charge 10% to consult. I'm sure they serve a purpose but I left that meeting skeptical.

I used Frank Stabler who owns certified business brokers.

I would highly recommend him. He is Houston based but can do outside houston from what I remember

The Lurker said:

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Don't business brokers charge 10% on the transaction value and you still need an attorney, CPA and other professionals to transact and advise on the sale?

I met with one before and seemed like total sham given the cost. Said even if a buyer/seller was already lined up they would still charge 10% to consult. I'm sure they serve a purpose but I left than meeting skeptical.

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On deals we have been on (buy side) the selling broker fees can vary and are usually sliding scale based on something like the old Lehman formula. So maybe 10% for first $1MM of purchase price, 8% for the next, 6% for next, then down to 1% with all additional with maybe a cap.

And on whether they are a sham or not, like any professional services offering there are great ones who we have loved working with and brought real, tangible value to their sell-side clients and helped get the deal done on structure, earn-out negotiations, as well as help on operational and financial due diligence. Others have been absolutely worthless and waste of everyone's time and money.

Use the last 12 month average cash flow times a few years to estimate a ballpark valuation, assuming no material changes in the last year.

What AgCPA95 said. I will say that most of the business brokers that I have run into were pretty poor. I imagine that it depends on the size of the business. You have a better probability of attracting a better broker.

Where is the business located?

kodymack82 said:

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My family inherited a small business after the death of a parent and we have no interest in keeping it. It is profitable and has about 8 acres of property included with it. We really don't have an idea of where to start to begin the process of listing it for sale. Is it worth going through a small business broker?

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Curious if you were able to find someone to help you? I actually have a towing company under LOI with a buyer at the moment, so I have dozens of other buyers interested in the towing industry that are still searching the market for an opportunity. Please let me know if you'd like to talk. Thanks!

Can you please contact me at brent at donquick dot com. I have someone that could be interested depending on the location.

Interested in getting more details. username @ gmail.

We used CGK Business Sales in Austin. Google them. By far the best in running the whole process to the finish line. They don't charge a dime until the business is sold. Awesome learning experience.

Anyone have broker recs other than the ones listed ? CGK recommender only has one post. Ever.

Chris, i might email you about your rec.