Recommend an agent to sell a business?
Discussion
Be very careful about agents charging up front fees to list your property. We've heard of some firms being charged £1,500 up front fees to prepare particulars and get access to their database of clients. 900 properties at £1,500 makes for a brilliant listing company!
Not sure whom to recommend otherwise. I deal with stuff in Pembrokeshire.
Good luck.
Not sure whom to recommend otherwise. I deal with stuff in Pembrokeshire.
Good luck.
Oi_Oi_Savaloy said:
Be very careful about agents charging up front fees to list your property. We've heard of some firms being charged £1,500 up front fees to prepare particulars and get access to their database of clients. 900 properties at £1,500 makes for a brilliant listing company!
Not sure whom to recommend otherwise. I deal with stuff in Pembrokeshire.
Good luck.
The better (more professional) companies DO charge upfront fees for marketing. Why should the agent be out of pocket if the vendor changes his mind, or (as often happens) sells it to a "friend", or worse still, sells it to someone who was introduced by the agent, but then does a midnight flit before paying the agent his fee? Decent professional business transfer agents are worth the investment as they have the best, most professional resources and know their buyers and their markets. If you want an example, compare Ernest Wilsons, Knightsbridge or Nationwide websites to the professional valuers/surveyors/agents such as Christie.com or Colliers CRE. As a seller, you are asking for a solid commitment from the agent, so why not show some commitment to the agent that you sincerely want to sell. The bigger and most respected the agent, the bigger resource they will be employing (it's a numbers game) in endeavouring to sell your business. The more people that look at your business.... the more interest you will get.... the better price you will realise.Not sure whom to recommend otherwise. I deal with stuff in Pembrokeshire.
Good luck.
My advice is to find a business agent that specialises, and indeed has a client list of similar businesses to yours. An ad in businessesforsale.com or Daltons Weekly if you're going to try it yourself. Let me know what kind of retail business it is and I'll try to point you in the right direction. PM me if you like.
Edited by YRRunner on Wednesday 3rd March 18:53
YRRunner said:
Oi_Oi_Savaloy said:
Be very careful about agents charging up front fees to list your property. We've heard of some firms being charged £1,500 up front fees to prepare particulars and get access to their database of clients. 900 properties at £1,500 makes for a brilliant listing company!
Not sure whom to recommend otherwise. I deal with stuff in Pembrokeshire.
Good luck.
The better (more professional) companies DO charge upfront fees for marketing. Why should the agent be out of pocket if the vendor changes his mind, or (as often happens) sells it to a "friend", or worse still, sells it to someone who was introduced by the agent, but then does a midnight flit before paying the agent his fee? Decent professional business transfer agents are worth the investment as they have the best, most professional resources and know their buyers and their markets. If you want an example, compare Ernest Wilsons, Knightsbridge or Nationwide websites to the professional valuers/surveyors/agents such as Christie.com or Colliers CRE. As a seller, you are asking for a solid commitment from the agent, so why not show some commitment to the agent that you sincerely want to sell. The bigger and most respected the agent, the bigger resource they will be employing (it's a numbers game) in endeavouring to sell your business. The more people that look at your business.... the more interest you will get.... the better price you will realise.Not sure whom to recommend otherwise. I deal with stuff in Pembrokeshire.
Good luck.
My advice is to find a business agent that specialises, and indeed has a client list of similar businesses to yours. An ad in businessesforsale.com or Daltons Weekly if you're going to try it yourself. Let me know what kind of retail business it is and I'll try to point you in the right direction. PM me if you like.
Edited by YRRunner on Wednesday 3rd March 18:53
I work for BCMS Corporate, we work with mid-large companies (£1m t/o plus). Our up front fees are some of the highest and yet we're more successful than any other business because of the amount of work we put in up front which is paid for by the fee. Simply put, if you want to maximise the sale price of your business you need to proactively and thoroughly market it.
Another important point is that you cannot value a business despite it being generally agreed that you can (bear with me). Your business is unique, it has unique customers, unique staff, a unique brand name, a unique location, has been establised a unique amount of time, has a unique reputation etc. All these items and many more have a value. Accountants 'value' a business based on mulptiples of past profits but this not only fails to take account of all the attributes mentioned above but also values your business based on what it has achieved in the past. An acquirer is concerned with what you business can achieve in the future.
To save me writting 'chapter and verse' on this just go to our website and either download our free book (takes about 1hr to read), go to a free seminar or just read what's written on the pages. It's not 'salesy', just sound logic.
Thank you everybody. Some very helpful and informative posts there - I'll follow up on suggestions made.
I must say I've got a better response from Pistonheads than through various Linkedin groups. It remains a very good site and community overall - despite the acidity of some posts!
I must say I've got a better response from Pistonheads than through various Linkedin groups. It remains a very good site and community overall - despite the acidity of some posts!
Any clues as to sector / price etc?
Agents can be incredibly useful (and worth their weight in gold) but aren't necessary in all transactions. You may find that the corporate finance wing of a local accountant can offer a similar service more cost-effectively - especially if you know your target market.
Not to criticise the agents and brokers - just not always appropriate imho.
Agents can be incredibly useful (and worth their weight in gold) but aren't necessary in all transactions. You may find that the corporate finance wing of a local accountant can offer a similar service more cost-effectively - especially if you know your target market.
Not to criticise the agents and brokers - just not always appropriate imho.
All good points chaps - I was thinking about some of the larger listing companies in the back of Daltons.....
I guess the other way of looking at it is; how serious is the seller? If he's not prepared to pay fees to assist in selling his company then there's no point in carrying on.
In terms of selling to a family member or pulling out - surely your Terms of Business will cover that element and charge a withdrawal fee irrespective of their reasons for pulling out. And if you find a ready, willing and able purchaser and then your client pulls out the entire fee might be due?
I guess the other way of looking at it is; how serious is the seller? If he's not prepared to pay fees to assist in selling his company then there's no point in carrying on.
In terms of selling to a family member or pulling out - surely your Terms of Business will cover that element and charge a withdrawal fee irrespective of their reasons for pulling out. And if you find a ready, willing and able purchaser and then your client pulls out the entire fee might be due?
Oi_Oi_Savaloy said:
All good points chaps - I was thinking about some of the larger listing companies in the back of Daltons.....
I guess the other way of looking at it is; how serious is the seller? If he's not prepared to pay fees to assist in selling his company then there's no point in carrying on.
In terms of selling to a family member or pulling out - surely your Terms of Business will cover that element and charge a withdrawal fee irrespective of their reasons for pulling out. And if you find a ready, willing and able purchaser and then your client pulls out the entire fee might be due?
I assume this was directed at my post? We charge an up front fee to generate the maximium amount someone is prepared to pay in the market. If the buisness sells we have a small comission for this. It can be frustrating if the client changes his/her mind at the last minute but tbh it happens rarely. Sometimes the market simply won't pay what the client wants. We only help generate the maximum amount achievable, we don't/can't/wouldn't force someone to sell. Sometime a client may get an excellent offer but not like the potential acquirer, given that their business is often their life's work and the staff are like family memebers they are almost never willing to put money ahead of emotive issues relating to their staff or business.I guess the other way of looking at it is; how serious is the seller? If he's not prepared to pay fees to assist in selling his company then there's no point in carrying on.
In terms of selling to a family member or pulling out - surely your Terms of Business will cover that element and charge a withdrawal fee irrespective of their reasons for pulling out. And if you find a ready, willing and able purchaser and then your client pulls out the entire fee might be due?
(I need to rewrite this so it doesn't sound 'salesy'. It is not meant to, I am just trying to explain how one process works.)
Frimley111R said:
To save me writting 'chapter and verse' on this just go to our website and either download our free book (takes about 1hr to read), go to a free seminar or just read what's written on the pages. It's not 'salesy', just sound logic.
Do you have a link? I can't find one on your profile. FWIW I've just terminated my agreement with a business sales agent who was marketing a business on my behalf.
I did pay a perfectly reasonable upfront fee, and received widespread advertising and access to their list of buyers etc.
Despite this, they generated no leads at all in 12 months.
This can in part be attributed to the 'current economic climate', but also possibly to the horrendous over valuation that the agent placed on the business (100% over).
Having realised that the business wasn't worth what it had been 'valued' at I then realised that the final fee payable to the agent on a successful sale would be way out of proportion.
I'm now planning to market the business myself, and engage the services of a solicitor as and when appropriate.
Horses for courses I guess. In my own personal circumstances I now think that there isn't enough value in the business to make engaging an agent worthwhile.
I did pay a perfectly reasonable upfront fee, and received widespread advertising and access to their list of buyers etc.
Despite this, they generated no leads at all in 12 months.
This can in part be attributed to the 'current economic climate', but also possibly to the horrendous over valuation that the agent placed on the business (100% over).
Having realised that the business wasn't worth what it had been 'valued' at I then realised that the final fee payable to the agent on a successful sale would be way out of proportion.
I'm now planning to market the business myself, and engage the services of a solicitor as and when appropriate.
Horses for courses I guess. In my own personal circumstances I now think that there isn't enough value in the business to make engaging an agent worthwhile.
Thurbs said:
Frimley111R said:
To save me writting 'chapter and verse' on this just go to our website and either download our free book (takes about 1hr to read), go to a free seminar or just read what's written on the pages. It's not 'salesy', just sound logic.
Do you have a link? I can't find one on your profile. Rockatansky said:
FWIW I've just terminated my agreement with a business sales agent who was marketing a business on my behalf.
I did pay a perfectly reasonable upfront fee, and received widespread advertising and access to their list of buyers etc.
Despite this, they generated no leads at all in 12 months.
This can in part be attributed to the 'current economic climate', but also possibly to the horrendous over valuation that the agent placed on the business (100% over).
Having realised that the business wasn't worth what it had been 'valued' at I then realised that the final fee payable to the agent on a successful sale would be way out of proportion.
I'm now planning to market the business myself, and engage the services of a solicitor as and when appropriate.
Horses for courses I guess. In my own personal circumstances I now think that there isn't enough value in the business to make engaging an agent worthwhile.
Ok, (deep breath)....I did pay a perfectly reasonable upfront fee, and received widespread advertising and access to their list of buyers etc.
Despite this, they generated no leads at all in 12 months.
This can in part be attributed to the 'current economic climate', but also possibly to the horrendous over valuation that the agent placed on the business (100% over).
Having realised that the business wasn't worth what it had been 'valued' at I then realised that the final fee payable to the agent on a successful sale would be way out of proportion.
I'm now planning to market the business myself, and engage the services of a solicitor as and when appropriate.
Horses for courses I guess. In my own personal circumstances I now think that there isn't enough value in the business to make engaging an agent worthwhile.
Advertising your business on a website is a very passive way to sell your business. Would you sell you own goods/services this way (and no other way)? Of course not. The agent needs to go out and find purchasers but this a skilled and time-consuming activity which many agents don't bother to do.
A list of buyers will mostly consist of people looking for a bargain. They want your business cheap. You need strategically motivated potential buyers who want to grow your business using their resources.
In addition to what I have said about valuation above you should NEVER put a price on your business. As soon as you do that you cap the maximum amount anyone will pay and a potential buyer then knows where to start negotiating the price down from. If the value was £500k, guess what a potential buyer isn't going to offer!
We often quote one client who had an offer of £3m for their business (generated by our process). Final offer? £22m!!! Imagine if they'd have advertised their busines for, e.g. £5m and accepted £3m.
Obviously I don't have any details of your business but only by actively marketing your business to strategically motivated potential buyers will you ever find out its true worth.
If you are going to DIY then download our company's free book. It's worth its weight in gold - trust me!!
Rockatansky said:
FWIW I've just terminated my agreement with a business sales agent who was marketing a business on my behalf.
I did pay a perfectly reasonable upfront fee, and received widespread advertising and access to their list of buyers etc.
Despite this, they generated no leads at all in 12 months.
This can in part be attributed to the 'current economic climate', but also possibly to the horrendous over valuation that the agent placed on the business (100% over).
Having realised that the business wasn't worth what it had been 'valued' at I then realised that the final fee payable to the agent on a successful sale would be way out of proportion.
I'm now planning to market the business myself, and engage the services of a solicitor as and when appropriate.
Horses for courses I guess. In my own personal circumstances I now think that there isn't enough value in the business to make engaging an agent worthwhile.
Therein lies a pitfall. Many business agents (and residential for that matter) employ a pitch where, in order to make you feel "warm & fuzzy all over", they will purposely over appraise (valuations can only be made on a formal basis by a chartered surveyor, appraisals are indicative and most agents will shy away from giving a written "valuation" for obvious reasons), in order to get the instruction from you. Think about it, when selling your house, fee is one concern, but most people will go with the agent who appears to be the more likely to get you the higher price. Once they have you signed up, they will then (after say 3 months) come back to you asking you to consider lowering the price. They call this "managing the clients expectations". Every business finds it's level eventually, unfortunately many vendors will have wasted anything between 6 months to 2 years "testing the market".I did pay a perfectly reasonable upfront fee, and received widespread advertising and access to their list of buyers etc.
Despite this, they generated no leads at all in 12 months.
This can in part be attributed to the 'current economic climate', but also possibly to the horrendous over valuation that the agent placed on the business (100% over).
Having realised that the business wasn't worth what it had been 'valued' at I then realised that the final fee payable to the agent on a successful sale would be way out of proportion.
I'm now planning to market the business myself, and engage the services of a solicitor as and when appropriate.
Horses for courses I guess. In my own personal circumstances I now think that there isn't enough value in the business to make engaging an agent worthwhile.
My advice.... Speak to many agents but tell them you want an honest market appraisal - NO B.S. over inflated values. There are multiples of net profit attached to all kinds of businesses. These are a rule of thumb generally but are a good guide. If what the agent indicates is extraordinarily above the multiple applied to your NP, walk away and choose someone who seems to be the most realistic, has a good knowledge of the market, has a large resource to draw from and can show you comparible businesses they have actually sold. Finally, remember this. Even the multiples go out of the window in a crap market. Your business is not worth what YOU think it is, it is only worth what someone else is willing to pay for it. In todays market, if you have a good business with good cash flow, you'd be a fool to sell it. Good luck!
YRRunner said:
Rockatansky said:
FWIW I've just terminated my agreement with a business sales agent who was marketing a business on my behalf.
I did pay a perfectly reasonable upfront fee, and received widespread advertising and access to their list of buyers etc.
Despite this, they generated no leads at all in 12 months.
This can in part be attributed to the 'current economic climate', but also possibly to the horrendous over valuation that the agent placed on the business (100% over).
Having realised that the business wasn't worth what it had been 'valued' at I then realised that the final fee payable to the agent on a successful sale would be way out of proportion.
I'm now planning to market the business myself, and engage the services of a solicitor as and when appropriate.
Horses for courses I guess. In my own personal circumstances I now think that there isn't enough value in the business to make engaging an agent worthwhile.
Therein lies a pitfall. Many business agents (and residential for that matter) employ a pitch where, in order to make you feel "warm & fuzzy all over", they will purposely over appraise (valuations can only be made on a formal basis by a chartered surveyor, appraisals are indicative and most agents will shy away from giving a written "valuation" for obvious reasons), in order to get the instruction from you. Think about it, when selling your house, fee is one concern, but most people will go with the agent who appears to be the more likely to get you the higher price. Once they have you signed up, they will then (after say 3 months) come back to you asking you to consider lowering the price. They call this "managing the clients expectations". Every business finds it's level eventually, unfortunately many vendors will have wasted anything between 6 months to 2 years "testing the market".I did pay a perfectly reasonable upfront fee, and received widespread advertising and access to their list of buyers etc.
Despite this, they generated no leads at all in 12 months.
This can in part be attributed to the 'current economic climate', but also possibly to the horrendous over valuation that the agent placed on the business (100% over).
Having realised that the business wasn't worth what it had been 'valued' at I then realised that the final fee payable to the agent on a successful sale would be way out of proportion.
I'm now planning to market the business myself, and engage the services of a solicitor as and when appropriate.
Horses for courses I guess. In my own personal circumstances I now think that there isn't enough value in the business to make engaging an agent worthwhile.
My advice.... Speak to many agents but tell them you want an honest market appraisal - NO B.S. over inflated values. There are multiples of net profit attached to all kinds of businesses. These are a rule of thumb generally but are a good guide. If what the agent indicates is extraordinarily above the multiple applied to your NP, walk away and choose someone who seems to be the most realistic, has a good knowledge of the market, has a large resource to draw from and can show you comparible businesses they have actually sold. Finally, remember this. Even the multiples go out of the window in a crap market. Your business is not worth what YOU think it is, it is only worth what someone else is willing to pay for it. In todays market, if you have a good business with good cash flow, you'd be a fool to sell it. Good luck!
I tried B*MS cost me well over £10k and achieved nothing except timewasters who signed an NDA to find out the name of the business then disappeared off the radar and then badmouthed the Company within the industry along the lines of "I would'nt buy from them did you know they were up for sale "
And the fee is not a tax deductible expense.
Has anyone used or know of a business sales agent called Turner Butler (PM me if necessary) or recommend a good one
And the fee is not a tax deductible expense.
Has anyone used or know of a business sales agent called Turner Butler (PM me if necessary) or recommend a good one
Frimley111R said:
Oi_Oi_Savaloy said:
All good points chaps - I was thinking about some of the larger listing companies in the back of Daltons.....
I guess the other way of looking at it is; how serious is the seller? If he's not prepared to pay fees to assist in selling his company then there's no point in carrying on.
In terms of selling to a family member or pulling out - surely your Terms of Business will cover that element and charge a withdrawal fee irrespective of their reasons for pulling out. And if you find a ready, willing and able purchaser and then your client pulls out the entire fee might be due?
I assume this was directed at my post? We charge an up front fee to generate the maximium amount someone is prepared to pay in the market. If the buisness sells we have a small comission for this. It can be frustrating if the client changes his/her mind at the last minute but tbh it happens rarely. Sometimes the market simply won't pay what the client wants. We only help generate the maximum amount achievable, we don't/can't/wouldn't force someone to sell. Sometime a client may get an excellent offer but not like the potential acquirer, given that their business is often their life's work and the staff are like family memebers they are almost never willing to put money ahead of emotive issues relating to their staff or business.I guess the other way of looking at it is; how serious is the seller? If he's not prepared to pay fees to assist in selling his company then there's no point in carrying on.
In terms of selling to a family member or pulling out - surely your Terms of Business will cover that element and charge a withdrawal fee irrespective of their reasons for pulling out. And if you find a ready, willing and able purchaser and then your client pulls out the entire fee might be due?
(I need to rewrite this so it doesn't sound 'salesy'. It is not meant to, I am just trying to explain how one process works.)
I think an agent can genuinely add value to a business owner.
It was simply a statement about fees and how to justify up-front rather than back-end fees.
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