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Business Brokers Commissions ??

From reading prior posts regarding business brokers commissions it seems that fees are between 8%-12%. What if realestate is involved in the sale? Do the same rates apply? or would it be reasonable to think that realestate fees should be between 2%-6% and the business between 8%-12%? and can a business broker sell realestate?

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Answers (6)
Michael S. Davidson
BizEx Businesss Brokers
Business Broker
Los Angeles County, CA
Premium Broker

Yes, we generally charge one rate for the business and another rate for the real estate, within the ranges you mentioned.

Its a bigger commitment from the Buyer to acquire both entities at the same time, but it does make it easier to get financing for the combine acquisition.

Jul 4, 2009
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No matter what your decision just be aware that you pick qualified and licensed as Realtor or Business Broker. Commisions could be negotiable as low as 2% to 12% The most important thing is make everything in writting, make sense, clear and easy to understand. Number can be addjust as long as its agreed by all parties. Make sure to pick either Realtor or Business broker who want to split their commision 50-50 or avoid exlusive listing(only him/her will or can sell your business or property) Mostlikely you will wasting your time and your value asset with this kind of firm. Be aware of Fancy contract listing agreement which trap you to exclusive listing and you will regret it later. Every representations should be clear Seller representation, Buyer Representation or Dual side representations. Not every Realtor or Business Broker welcome Buyer representations with any kind stupid reasons. Number is means nothing as long as they really workin' hard to your best representations Price and Market your listing at a current market PRICE!!! BRING and WELCOMING all good qualified buyer from any firms, showings, offers. and Closed the DEAL @ Settlement table
Good Luck!!!

Jul 4, 2009
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The BAF Group LLC

Whether any Business Broker can sell Real Estate depends upon the Broker, him/herself and where they hace their practice. In some states, Business Brokers are licensed by their local Real Estate commissions and the licenses allow them to do both. In most states however, there is no license required for Business Brokers, although all states require that Real Estate sales be performed by licensed practitioners. Regardless of how your state governs the licensing of Business Brokers, you should take care in listing your business with a Business Broker that is also licensed for Real Estate, if your opportunity conveys with property.

As for commission rates, everything depends upon negotiation, regardless of whether there is Real Estate linked to the sale of the business. The law in all states demands that. Remember that, in some cases, you get what you pay for; if you negotiate the rate down, you may find that you sacrifice services that might normally come with that higher rate. On the other hand, just because a given Broker charges you the maximum does not mean he/she is guaranteed to do the best job for you. As one writer suggested, interview several Brokers; our suggestion is that you try to select the ones you are considering from referrals of other satisfied Buyers and Sellers.

Good luck.

Jul 4, 2009
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Broker Consulting Services
Sr Broker
New York County, NY

No, my firm charges no fee on RE, only business portion of sale. If RE and business sells for 1Million, but the business is worth 300,000, my commission is 30,000. That means the total deal was 3%

Joe is an accomplished business management consultant professional with over 30 years of hands-on experience in management positions, as a business owner, and as a consultant to businesses. He offers a proven history of implementing, analyzing, and monitoring sales, production, inventory, vendor/supplier contracts and customer service methods to improve profitability, dependability, and growth. As a former owner/operator he knows the tremendous potential as well as challenging demands any current or future business owner must face, from start up through expansion, and evaluating strategies for acquisition and divestiture. Sales, operations, human resources, project management, and strategic planning are just a few areas Joe has extensive knowledge and practical experience. These attributes coupled with a BA in management from Stanton University allows Joe to be a valuable asset in helping any business owner achieve their goals. Joe's background and commitment to helping business owners succeed make him a valuable and unique asset to both buyers and seller alike

Jul 3, 2009
Aron Culver
BTI Group / Business Team

You're right on track. Typical broker fee for business, depending on the size is 10% average and the real estate 5-6%, at least in California. Business brokers in CA must be licensed by the Department of Real Estate and can sell the real estate too. However, it is always best to interview several brokers to determine who can and will do the best job for you.

Jun 8, 2009
Julie A. Barnes, CPA
Small Business Exchange, Inc.
Travis County, TX

Hi Bob,

You're right on target - the sale of the business would be subject to the 8% - 12% or whatever is negotiated with the business broker and the usual commission of 2% - 6% would be paid on the portion of the sale that is attributable to real estate.

A business broker must have a real estate license in order to receive the real estate related commission.

Good Luck!
Julie A. Barnes, CPa
Small Business Exchange Inc.

May 30, 2009