Are you wondering what do business brokers charge to sell a business? You’re in the right place! In this article, we’ll provide you with an overview of the different commission fees charged by business brokers, the different types of fees involved, and the best way to negotiate these fees.

What do business brokers charge to sell a business?

Business brokers typically charge between 10 to 20 percent of the total sale price as their fee for services. This fee is usually collected at closing and is often negotiable. Generally, a business broker’s commission is a percentage of the final purchase of the business that was sold. It is the same principle as a realtor. A realtor will charge a percentage of the sale of a home.

Here are some of the different types of fees typically charged by business brokers:

  • Flat commission – Sometimes, broker firms may simply charge a flat commission in the range of 4-6% on the total purchase price of the business.
  • Upfront fees – For a small business, our broker commission is typically 10% of the sale price of the business. The upfront fees required to value, market and close a sale can range from a few hundred dollars to a few thousand.
  • Real estate commission – If you own the real estate your business operates from and want to sell it, we’ve seen commission rates anywhere from 4% to 6%. At this level, the real estate commission is usually split between the seller’s broker and the buyer’s broker.

In most cases, business brokers charge around 10%-15% of the business’s sale price. Therefore, it’s essential to negotiate the commission fees with your broker to get the best deal possible.

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Who is responsible for covering the cost of selling a business?

Typically, the seller is responsible for the Broker’s fee. If the buyer was connected to the business through another brokerage firm, the commission will be divided in half between the buy-side and sell-side brokers.

What are the benefits of using a broker to sell your business?

Your broker will use the appraisal and other variables to negotiate the sale price. They will look at the sales of comparable businesses, industry patterns, and marketplace conditions to make sure the seller gets the best possible deal.

What is the usual commission charged by a broker?

The typical cost of a brokerage fee includes an annual fee of between $50 and $75 per year, as well as inactivity fees that may be assessed on a monthly, quarterly or yearly basis totaling anywhere from $50 to $200 annually or more. Research and data subscriptions can cost between $1 and $30 per month and a trading platform fee can range from $50 to more than $200 per month.

What is the most effective way to locate a broker to sell my business?

The best way to locate a business broker is to ask for a referral from someone you trust in your business circle. It is important that you have trust in the broker-client relationship. You may also look in the business section of a newspaper and look for any certifications or memberships they may have.