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How to Run a Business Brokerage

The value of nurturing repeat business, gaining an edge through specialisation and more.

There are some very good reasons for going it alone when it comes to making the most of a career as a business broker: you get free rein to target your preferred clients and sectors, and you can reap greater rewards from growing profits.

Buy an established firm and you’ll inherit existing clients, repeat business and a reputation built over many years.

Once you’ve gone through the buying process, it’s time to manage the transition to new ownership with as little disruption as possible. After familiarising yourself with day-to-day operations, you can then consider your strategy for growth.

Specialisation

What sectors does your new business specialise in? A broker can sell businesses in a broad range of industries, but specialising in one or two can be a strategic path to success.

Customers tend to favour firms with a reputation for overseeing deals in their industry.

Does your new business make the most of its expertise in selling hotels, restaurants or manufacturers? You could look to champion such unique selling points more volubly and intelligently on your website and social media accounts and in your email marketing.

But there are risks to specialisation too. Imagine there’s a sharp downturn in your specialist sector and business dries up. 

“If you’re in retail, for example, businesses are consistently going down rather than up,” says Eddie Pampalian, general manager at business brokerage franchise Network Infinity .

A ‘jack of all trades’ would be less exposed to a retail downturn.

So if the business you’ve acquired specialises in a troubled industry like retail and little else, it might be worth diversifying to make your business more resilient.

Specialisation in value-adds like business valuation and premium advisory services can also give you an edge over the competition.  

Quality not quantity

Pampalian emphasises the importance of doing your job well throughout the customer’s journey – not just in winning their business in the first place. “Making sales is what makes a good business broker – actually selling businesses rather than just taking them on,” he says.

In other words, your success rate at finalising deals – at fair prices – is far more important than the number of businesses on your books. This is the metric by which most savvy sellers will judge you before hiring you.

That said, you always need to be on the lookout for new business. Don’t rely too heavily on one or two big sales coming to fruition. 

It’s worth remembering that businesses can be on the market for quite a while before they sell – some might not even sell at all. You need a steady stream of sales to keep your business ticking over.

Paperwork

If dealing with paperwork is interfering with your ability to build and nurture client relationships, consider recruiting an office manager, even if your balance sheet only allows for a part-time hire.

“You will have lots of paperwork – dealing with solicitors, accountants and other stakeholders for each sale,” says Pampalian. “It’s easy to get bogged down, and you need to keep the ball rolling with new listings to sell and enough buyers interested. Otherwise, it could break your business.”

Your digital shop front

Although much of your business will come through word-of-mouth referrals, even a ‘ relationship’ business like brokerage cannot afford to ignore digital marketing. Yet surprisingly many brokers do – creating an opportunity for you to gain a real advantage when it comes to finding new business.

Optimising your SEO needn’t cost a fortune with innumerable SEO firms vying for business. If money is really tight, you could find specialists through peer-to-peer platforms like Upwork.com to catapult you up the search rankings for terms like ‘business broker NSW’ or ‘sell a business Queensland’.

Your website is your digital shop front and can make a powerful first impression – positive or negative. There’s no excuse for neglect here; a professional-looking website can be produced relatively inexpensively through website-building platforms like Squarespace.

Displaying the current businesses you have for sale will help attract buyers as well as sellers to your site. Because it’s regularly updated content, it can help you climb Google search rankings too.

Does your website have a testimonials channel? If not, then ask satisfied former customers if they’re willing to give you a testimonial and set up a dedicated channel in your top navigation bar.

Prospective clients can find you through LinkedIn too. Make sure your profile is up to date with all qualifications, certifications, career highlights and anything else that burnishes your credibility with prospective customers. It’s a great way to reassure customers that the new owner is as capable and qualified as the previous incumbent.

Eddie Pampalian recommends spending money on third-party listing sites. “External business listing platforms, like BusinessesForSale.com, are important for brokers: you get more bang for your buck in terms of website listings and you can piggyback off them. Although they can be expensive, they’re critical.”

Repeat business

And finally, make repeat business a primary focus of your strategy. It will make your business more valuable when you come to sell up and it eases the pressure around constantly bringing in new business.

It’s worth investing time and effort nurturing relationships with serial entrepreneurs: those who regularly start, buy and sell businesses. Similarly, a major franchise network can be an excellent source of repeat business if you can persuade them to sell their franchise resales exclusively through your firm.

Credentials

Although business brokers don’t need industry accreditations and formal training to operate, it will help you attract clients and deliver a better service. 

That the process of buying or selling a business is increasingly data-driven and specialised makes professionalisation more important still. The Australian Institute of Business Brokers can help with the following training programmes:

  • State licence or certificate courses
  • Certified practising business broker
  • Continuing professional development
  • Senior business broker
  • Registered business broker

Browse our business brokerages for sale



Faye Ferris

About the author

APAC Sales & Marketing Director for BusinessesForSale.com, the world’s most popular website for buying and selling businesses globally and attracting over 1.5 Million visitors each month. To contact Faye please email faye@BusinessesForSale.com

@YouAreYourBoss

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