Business broker fees, from the firms' own pages

Published fees, checked

How to compare two fee quotes

1. Convert both to dollars at your price. A 10% commission with a $25,000 minimum and a 12% commission with no minimum cross over at $250,000. The percentages tell you nothing until you put your own number in.
2. Add everything payable before the sale. Retainers, listing fees, marketing packages and valuation charges. On the published side of this record that ranges from nothing to $100 a month; with an adviser it can be thousands.
3. Ask whether the ladder is blended or tiered. Empire Flippers publishes a blended ladder, meaning the lower rates apply only to the money above each threshold. A tiered ladder applies one rate to the whole price and produces a very different number.
4. Find out when it falls due. Two of the published schemes here are payable only on closing, and one says so in terms. A fee invoiced on signing is a different risk.
5. Ask what happens if you withdraw. None of the eight firms read publishes this. It is the term most likely to surprise a seller who changes their mind.

The commission, and what the published ones look like

Three of the eight US firms read for this record print a seller commission. Flippa's success fees start from 5%. Acquire.com prints three bands by asking price: 8% below $250,000, 7% to $1m and 6% above it. Empire Flippers prints a blended ladder whose first rate is 15% and which falls to 8% and then 2.5% on the money above each threshold.

All three sell online businesses, and that is not a coincidence. A marketplace whose buyers are remote cannot operate on a fee you have to ask about, so its price list is public. The routes whose buyers turn up in person publish nothing.

The floor underneath the percentage

Empire Flippers charges a flat $10,000 on anything selling under $66,666.66, which on a $50,000 business is 20% rather than the 15% band above it. Main-street brokers work the same way with minimums that go unpublished.

That is why the first question about any fee is the minimum in dollars rather than the rate. Below roughly $250,000 of sale price the floor decides the price of selling; above it the percentage takes over.

What is payable before anything sells

On a marketplace it is a listing fee: $29 for a sixty-day term on Flippa, $25 to $100 a month on Acquire.com depending on the asking price. It is the only money in that route that is not contingent on a sale.

With an M&A adviser it is a monthly retainer, which is normal at that size and which none of the advisers read for this record publishes. With most brokers in between it is nothing: Website Closers states a 100% success-based model with no upfront fees or retainers.

Common questions

What is a typical business broker commission?

Where it is published in this record it runs from 5% to 15% of the sale price. Raincatcher's own selling guide says brokers typically charge a commission of 5% to 10% of the final sale price, which is a range for the trade rather than any one firm's price.

Do I pay a business broker if the business does not sell?

On a marketplace, yes: the listing fee is not contingent. With most brokers, no, and two of the published schemes here say so in terms. With an M&A adviser a monthly retainer is normal and unpublished.

Are business broker fees negotiable?

Often on larger deals and rarely at the published end. A marketplace rate card is a rate card; a broker quoting on a multi-million-dollar business is quoting, and the scale at the top of the range is the part worth negotiating.

Who pays the business broker, the buyer or the seller?

The seller, out of the proceeds at closing, in every published scheme in this record. Acquire.com states it plainly: the closing fee is due in full at closing and is only owed if the business sells.

Coverage by selling route

• Small business brokers: who they are and what they charge
• Software business brokers: who they are and what they charge