Mr. Pasqualino, I don't argue with what you say about some, perhaps more than a few Brokers. Again, my concern is about judging all Brokers on the basis of those kinds of situations, and how to overcome or guard against being victimized by them. As I stated, make them put it in writing! We do. We stand by our information, and when there are questions about numbers, we have specific documentation that backs up any potential error - which is documentation we receive from the Sellers, by their own hand.
And once again, you point to another Restaurant, which is to say another Cash business. People in this forum or with whom we directly deal asked frequently, "How do I value a Restaurant?" or other Cash business. And our response is ALWAYS something to the effect that we cannot stand behind such businesses. Which is AGAIN, why we do not normally list them. Because we can NEVER document the Cash Flow.
And I am not knocking Restaurateurs, either. Let's stick to the initial topic, which is to say there are good Business Brokers and there are bad ones. And the bad ones should be drummed out of their own businesses. Those need to be held up to the light of day and made to take responsibility for their actions.
But they are not all crooked; there are some I would trust implicitly. They are not all unskilled; but there are some that I know for a fact, cannot read a P&L Statement. They are not all uninformed; but there are some that have no idea that it means to own and operate a business of their own.
As a Broker, I am embarrassed by some of them, do be certain. I deal with some of them from your perspective, because we act as Buyer Brokers with some frequency, and we have some of the same difficulties you do, in the issues you are relating. But we do so with infrequency because we ask the questions that need to be asked, BEFORE we waste time with the bad ones.
We turn away almost 80% of the business people that come to us, asking us to list their businesses for sale. We refuse the ones that have poor records, obviously false Tax Returns, businesses that should never have been opened in the first place or some that are outmoded and cannot possibly have a future. And we still get burned from time to time, by Sellers. Does that make all Sellers crooks? Not by a long shot. And neither are all Business Brokers. Neither are the large number of Buyers that waste my time, who have 10 cents in their pockets and want to buy a million dollar business.
We need to put all of these things into perspective. We were called by an Accountant once, whose Client was extremely ill, needed to sell and had no idea his Deli was worth anything. The Client was just going to throw the keys in and walk away. We sold his business for almost $700,000. (In his defense, the Seller's illness really clouded his judgement, but he was seriously going to walk away from the business!) That was three years ago, and I just bought lunch from the Buyer who said the business was up 60% under his ownership, in spite of the economy; he was still, extremely happy with his purchase and he has sent me two Buyers as referrals. Getting it financed was a killer, and I know we could not get him the same loan, today. But it was our contacts that got his funding for him. His Accountant was from out of State, and almost structured the deal in a way that would be terrible for the new Owner, because of strange laws in Maryland that pertain to Depreciation; we helped the Accountant understand that issue and gave him resources to check our information, since we are not Accountants, and can only suggest that he look into our suggestions. We had no reason to do that, because if the Buyer got screwed on that issue, what was it to us? Our Client was the Seller. But se spent a large number of hours researching our position, before presenting the information for the Buyer's Accountant to consider. And we worked with the Landlord to make him comfortable with the new Owner, in the process getting a Lease that was beneficial to all.
You want more inane stories? We have a number. Brokers do SOME good work, sometimes...