Does my Business Broker need to have experience with my specific Industry?

By Hoke - Last updated: Thursday, July 22, 2010 - Save & Share - Leave a Comment

Ultimately a Business Broker is selling an investment. So it is better to be represented by a Business Broker who is highly versed in the financial issues regarding the Business-For-Sale rather than one who understands the specific industry but is not an expert in the financial issues. In the rare case that the Business Broker has expertise in both facets he or she would be the best choice.

About 65% to 75% of Business Buyer questions and concerns are general financial questions that center on comparative Stability of Earnings, Return on Investment, Risk and Industry Trends. An experienced Business Broker adds value by explaining the relative merits of a business in terminology the Business Buyer can relate to and understand. The Business Broker must field questions relating to financial comparisons with other businesses in the same or vastly different industries. Published Industry Trends are available for most industries and have more credibility than the Broker’s or Business Seller’s opinion. About 20% of the Business Buyer concerns relate to specifics of the particular business or industry, how the Business Buyer could manage the acquisition and what their role will be.

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