What is a business broker

Use of a business broker

Sooner or later, succession planning and usually the sale of the company are due for every SME. But how can this process be approached in a targeted manner? How do entrepreneurs willing to sell find the “right” buyer who also wants to take over the company at the desired price? What are the requirements to ensure the necessary confidentiality during the entire sales process? Questions about questions that urgently need an answer. Because: For most entrepreneurs, the sale is the culmination of their life's work. Often the entrepreneurs concerned turn to their trustees or lawyers first. This is fundamentally not wrong and is certainly advisable in the approach - namely to get competent help from a person you trust. Although experts in their respective fields, these people are not very familiar with the requirements of a corporate transaction due to a lack of experience. In this case, the special skills and expert knowledge of a business broker - a transaction specialist - come into play in full. But what exactly is the benefit of such a business broker? The following points highlight the individual advantages and show you how you can best benefit from the services offered.

High level of expertise

The accompaniment and support of a corporate transaction require - in view of the present complexity - specific knowledge and well-founded experience. Only through a professional and situation-appropriate approach can opportunities be used profitably and unnecessary risks avoided. For a successful sale, it is of central importance that the process is carried out consistently and competently. Since most entrepreneurs do not have the necessary specialist and process knowledge, it is advisable to call in an appropriate advisor - experiments in selling a company can cost a lot of money and time.

Time relief

Prospective buyers are often very cautious at the beginning of the transaction phase. They try to gain security with countless questions. Often, however, their questions are perceived by the owner as inappropriate suspicion and therefore annoying and unpleasant. Cooperation with a business broker can help here. A meaningful company exposé enables the buyer to get a detailed picture of the company without having to divulge business secrets. Furthermore, the business broker relieves the owner of answering additional questions. The factual and competent answer creates trust and brings both parties a big step closer to the conclusion. Another aspect that should not be underestimated is the coordination of all parties involved in the process. A business broker coordinates and promotes cooperation between the people involved, such as owners, trustees, lawyers, tax advisors and prospective buyers. As the linchpin, he maintains an overview and can thus efficiently control the entire process. The advantage for the entrepreneur is obvious: he can devote himself fully to his day-to-day business.

Realistic company valuation

Valuing a company is a demanding business. The basis for every valuation is the professional adjustment of the figures, comprehensible planning for future years and the sensible application of the most diverse recognized methods for company valuation. Each method delivers different values ​​and should be used in a different context. Without a competent interpretation of the individual values ​​and results and the knowledge of a realizable market price, an evaluation is not expedient. A business broker can not only determine and interpret the theoretical company value using recognized methods, but is also able, thanks to its experience from already concluded transactions, to make very specific and realistic price recommendations based on the sales prices achieved. Furthermore, the business broker supports the company owner in the objective analysis of the company, so that all price-relevant quantitative and qualitative aspects can be taken into account and included in the price setting. The business broker has the advantage of being able to carry out the entire assessment in a neutral and unemotional manner in order to then make a realistic sales price estimate.

Professional approach to buyers

The sales and marketing aspects are often underestimated in succession planning. Only when the market plays, solid demand is created and the seller has a choice can the best be achieved. Anyone who is dependent on a single buyer will have to accept losses. A business broker who has a wealth of experience thanks to daily contact with a large number of buyers can assess the situation correctly and develop suitable solutions and concepts. He benefits from an extensive network of potential interested parties, which he can address efficiently and discreetly. In addition, a business broker can give a binding assurance of discretion. The structured and strategic approach of a business broker can guarantee that the company is marketed professionally without the public knowing about it. The flow of information is actively controlled, which means that confidentiality can be ensured at all times.

Goal-oriented negotiation

The price and contract negotiations require a high degree of sensitivity. Many transactions fail in this phase, because misunderstandings, false pride as well as overzealous salespeople can jeopardize the deal at any time. The type of communication, negotiating skills, mutual respect and the will to find a solution that is acceptable to both parties favor signing a contract. A business broker supports the owner in the negotiations in a factual and solution-oriented manner and promotes mutual trust. The final negotiations are usually a highly emotional matter for both parties. As a mediator, he can help the parties to understand the other side and to reach an agreement with constructive and creative solutions. It should not be forgotten that every company sale is unique in its form: Companies are complex and unique organizations. The goals of the negotiating partners differ from case to case, which is why the procedure must be adapted to the respective situation. This is the only way to achieve the best possible solution for the seller.

Competent drafting of contracts

The purchase contract is an essential part of the handling of a transaction. The creation of legal clarity is the goal of every contract drafting. In order to achieve this, the rights and obligations of the contracting parties must be clearly regulated. Furthermore, possible legal consequences in the event of a breach of contract or the occurrence of unusual events must be clarified and recorded in writing. Since every company is individual and every company acquisition is unique, the transaction and the design of the contract must also be treated as an individual case and no standard templates must be adopted.

Conclusion

Arranging a corporate succession is a multi-layered and complex matter and it makes corresponding demands on all those involved. By engaging an external consultant, it can be ensured that all necessary steps and tasks in the sales process are carried out professionally and adequately. Successful succession planning therefore depends heavily on choosing the right consultant.