Business brokers are generally compensated by a commission fee at the close of your business which is based on a percentage of the sales price. However, every situation is different, and some brokers charge a consulting fee in addition to a commission on the sales price of the business. Depending upon the selling price you may pay a fixed commission rate or for larger transactions the rate goes into a sliding scale. Each situation is a little bit unique and therefore we would need to understand more about your business to tell you exactly what the fee structure would look like.
Initial seller meetings are conducted by the Sunbelt Atlanta Broker (a professionally trained Business Broker/Intermediary holding a Real Estate license), and the seller is educated on the process of selling a business.
A Representation Agreement is filled out by the Sunbelt Broker in coordination with, and signed by, the seller. Immediately after signing the Representation Agreement, the Seller provides the Broker the following:
Complete lists of all equipment and other assets to be included or excluded in the sale.
Profit and loss statements, balance sheets and tax returns of the business covering the last three years or more.
The most recent interim profit and loss statement and balance sheet.
Real and personal property leases.
Copies of all patents, licenses, loan documents, contracts or agreements.
All agreements relating to employee benefits.
Any environmental reports.
Copies of all other documents needed to present a fair and accurate description of the business to prospective buyers.
During the representation period, the Seller must update each document when any material change has occurred. Seller consents to Sunbelt publishing, advertising or distributing information about the business in a discreet and confidential way to prospective purchasers as well as to contacting landlords and any others regarding any of the information about the business.
Sunbelt writes a narrative on the business. The Representation Agreement is entered into the Sunbelt proprietary database, and a Business Profile is created. The Business is introduced to all of our other brokers during weekly office meetings.
All other brokers match the Seller’s Business Data (SBD) against Buyers in their respective queues (Buyers, who have previously been interviewed, signed a Confidentiality Agreement and filled out a detailed Buyer’s Profile). Sunbelt plans an advertising strategy and the SBD is added to web sites in such a manner so the general public cannot identify the business.
Buyers in queue and buyers who have responded from the advertisements will have their backgrounds and finances evaluated to determine if they are qualified buyers. If qualified buyers are interested in the business for sale, they will be shown a Business Profile. If further interest is shown, the Seller’s broker will arrange a meeting with the Seller.
If a Buyer wants to make an offer at a fair price, the Buyer’s broker will write the offer and secure a deposit.
The Seller’s broker will present all offers to the Seller.
Seller and Seller’s broker will review each offer and decided whether to accept it or counter the offer. If Seller wants to counter, s/he can:
Mark up the original offer, initial the changes and sign the offer.
Re-write the offer.
Once an offer is accepted, due diligence begins:
All contingencies of the offer must then be addressed. If the due diligence proves the business to be as represented and all other conditions are met, the Buyer signs the contingencies to show they have been satisfied.
If the due diligence does not prove the business to be as represented or any of the other conditions, such as securing third party financing cannot be met, then either the offer for the business for sale can be renegotiated or the offer will be canceled and the Buyer’s deposit check will be returned.
Seller’s broker secures, answers and/or provides the following to ensure a timely close:
Copy of the Representation Agreement
Copy of the Purchase Agreement and Counteroffers
Copy of signed Contingencies Removals
Seller(s) name, address (other than business address), Social Security number, sales tax number, and federal tax identification number if a corporation.
Buyer(s) name, address (other than Business address), Social Security Number, and federal tax identification number if a corporation.
Secures the deposit check from Buyer.
Secures leases – amount of monthly rental, security deposit, assignment, new lease, etc./Estimates closing date, date of possession by Buyer and pro-ration date.
Investigates insurance. Will Buyer assume Seller’s or acquire new insurance? Taxes – Requests the Seller’s property tax bill for pro-ration.
Investigates required licenses. Are they transferable?
If Buyer and/or Seller are a corporation – need names of the officer(s) authorized to sign a Corporate Resolution authorizing the sale.
How will purchase be allocated?
Fixtures and equipment (FF&E)
Covenant not to compete
Licenses where applicable
The closing attorney will prepare a draft of the necessary closing documents including:
Bill of Sale
Buyer and Seller resolutions
Non-Compete, Non-Solicitation Agreement
Any other documents such as, but not limited to, a Seller Promissory Note, if applicable.
The above documents will be reviewed by the Buyer and Seller and their advisers, and will submit requested changes for consideration if necessary.
Once the documents are agreed to, a definite date and time will be set for Closing.
If applicable, the Sunbelt broker will coordinate a time acceptable to the Seller and Buyer to do an inventory count prior to Closing.
The Seller and Buyer will be given instructions by the closing attorney as to what they will be expected to bring to Closing.
Any amounts required by existing lien-holders must be satisfied prior to or at closing from the proceeds of the sale of the business.
Any prorating such as rent, utilities etc., where necessary, will be prepared by the closing attorney and shown on the Closing Statement.
When third party financing is involved, such as an SBA loan, sometimes a simultaneous Closing of the loan will take place by the attorney doing the business closing or by a second attorney representing the lender.
When all documents have been signed and funds are in place, a full set of Closing Documents will be distributed to the parties and funds will be dispersed.
This is one of the primary reasons business owners decide to use a business broker or intermediary. Each and every potential buyer inquiring about your particular business must sign a confidentiality agreement (NDA). Additionally, we prescreen all potential buyers to ensure each buyer has the ability to buy your business saving you time and protecting your interest.
There are a multitude of reasons why you should consider using a business broker, with the main one being you don't know what you don't know. Sounds silly at first but the reality is most people have never sold a business before. Or perhaps they've done it once or twice in their entire career. At Sunbelt Atlanta Business Brokers that's all we do everyday. We are experts at helping business sell their business for the most money and the least amount of time and risk. Furthermore we protect your confidentially throughout the process providing peace of mind for you, your vendors, customers and employees.
As a member of the Sunbelt Network, we place your business in front of a multitude of Deal Makers across the globe. Each Sunbelt office can confidentially access your listing and help promote the sale of your business at the best price possible. By using our proprietary website, our network is connected to an average of 12,000 business for sale listings!
Fully understanding the value of the business will assist during negotiations. In this market, one can expect buyers to be sophisticated and experienced. They will conduct a rigorous analysis of the company, even if the seller has not. They will look at those factors and value drivers that the owner and his advisors should consider in valuing the company, and they will use that information against the seller in negotiations.
We handle negotiations in a clean, patient and professional manner that keeps the business issues clearly in focus rather than clouded by emotions of personalities. Sunbelt Atlanta turns the concerns created by Attorneys, Accountants, Landlords, Buyersand Sellersinto creative solutions that work for you as we sell your business.
You can get started with the process of determining the value of your business with this simple online calculator. Once we get the results a member from our team will reach out to discuss our findings with you.