If you’re considering selling a business and engaging a business broker, you may be wondering “how much do business brokers charge to sell a business?”. This is a common question and one that requires a bit of explanation. While commission rates can vary depending on the size and industry of your business, there are some general guidelines to follow.

How much do business brokers charge to sell a business?

Generally, 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, meaning the broker’s commission is deducted from the purchase price of the business. It is the same principle as a realtor. A realtor will typically earn a commission of 5-6% of the sale price of a house.

If your business is in a certain size and industry category, expect to see commission rates between 8% and 10% of the sales price. By far, the majority of businesses fall into this category.

Sometimes, broker firms may simply charge a flat commission in the range of 4-6% on the total purchase price of the business. 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 facilitate the sale can vary considerably.

In conclusion

In most cases, business brokers charge around 10%-15% of the business’s sale price. Therefore, it’s essential to negotiate the commission fees when engaging a broker to sell your business.

If you have any more questions about selling a business or about business brokers, Atlantabusinesses.com is a great resource.

What percentage of the sale price of a business goes to the commission?

Business brokers typically receive a commission based on a certain percentage of the sale of a company, usually falling between 8% and 12%. They may also require upfront payments to cover any expenses related to the transaction.

Who is responsible for covering the costs associated with the sale of a business?

Typically, the seller is responsible for the Broker’s fee. If a different brokerage introduced the buyer to the enterprise, the commission will be shared between the buy-side and sell-side brokerage in equal parts.

What are the advantages of enlisting the help of a broker to sell your business?

Your broker will use the appraisal and other elements to negotiate the sale price. They will look into sales of other similar businesses, industry trends, and market variables to make sure the seller is not getting short-changed. Their aim is to make certain the seller is getting the highest possible price.

What is the usual charge for a brokerage service?

The typical cost of a brokerage fee includes annual fees which are usually between $50 and $75 a year, inactivity fees which may be levied on a monthly, quarterly or yearly basis up to $200 or more per year, research and data subscriptions costing between $1 and $30 a month, and trading platform fees of up to more than $200 a month.