Characteristics | Business Broker | M&A Intermediary |
Size of Business Sales | $100k – 3M | $3M-100M |
Type of Businesses | Retail Stores | Manufacturers |
Restaurants | Distributors | |
Service | Service | |
Documentation | Minimal | Extensive Offering |
Brief Write-up | Memorandum (30-50 pages) | |
Type of Buyers | Mostly Individuals | Strategic |
Locals | Private Equity Groups | |
National/International | ||
Compensation | Usually no Retainer | Retainer |
10-12% Commission | Structured Commission | |
Minimum $150 to $500k | ||
Sale Process | Advertising | Controlled Auction |
Email Blasts | Specific Time-line | |
Many Buyers Visit Seller | Few Management Meetings | |
Firm’s Advantage | Number of Seller Listings | Specific Industry Focus |
Duration of Contract | 12 months | 6 months then Renewable Thereafter |
Confidentiality | Extremely Tight | Involve CFO & probably Sales Manager |
After Hour Visits | ||
Only Owner Aware | ||
Financials | Use of very limited figures | Extensive Analysis |
Past/future | ||
Decision Maker | Founder/CEO | Founder/CEO and/or Board of Directors |
Fees | Around 10% Commission | Scaled depending on size such as: |
4% on $10M deals and 1% on $100M deals | ||
with minimums of $150k, $200k or $500k, etc. |
Business Broker vs M&A Intermediary
