What Does a Business Broker Actually Do?
A business broker acts as an intermediary between you and potential buyers. Their core services include creating a Confidential Information Memorandum (CIM), marketing the business through their network and listing platforms, screening and qualifying buyers, managing NDAs, coordinating showings and meetings, negotiating the Letter of Intent, and guiding the deal through due diligence to close.
A good broker brings a pipeline of pre-qualified buyers, knowledge of deal structures, and experience managing the emotional complexity of business sales. A mediocre broker collects your listing, puts it on BizBuySell, and waits for the phone to ring.
Side-by-Side Comparison: Broker vs. DIY vs. Exit Advisor
| Factor | Business Broker | Sell Yourself | Exit Advisor |
|---|---|---|---|
| Cost | 5-12% commission ($150K-$360K on $3M) | Attorney + CPA fees ($30K-$60K) | Flat/hourly fee ($15K-$50K) |
| Buyer access | Broad network + listing platforms | Your personal network only | Connects to brokers/buyers as needed |
| Time required from you | Low-Medium | Very High | Medium |
| Negotiation support | Full (they negotiate for you) | You negotiate directly | Strategic coaching + preparation |
| Incentive alignment | Close the deal (any deal) | Your interests 100% | Your best outcome (not tied to close) |
| Best for | Businesses $2M-$10M needing broad buyer reach | Known buyer or very small deals | All sizes, especially when preparation is key |
When Should You Hire a Broker?
A broker makes sense when you need broad market exposure, don't have an obvious buyer, and your business is in the $2M-$10M range where broker economics work well for both parties.
- You don't know who your buyer is
- Your business is worth $2M-$10M
- You don't have time to manage the sale process
- You need access to a buyer network beyond your personal contacts
- Your industry has active acquisition interest from PE or strategic buyers
When Should You Sell Without a Broker?
Selling without a broker works when you already have a likely buyer and the transaction is relatively straightforward.
- You have an employee, family member, or competitor ready to buy
- The deal value is under $1M (broker economics don't favor you)
- You have professional advisors (attorney, CPA) who can support the transaction
- You're comfortable with negotiation and deal management
- Confidentiality is paramount and you want to limit exposure
Not Sure Which Path Is Right for You?
We help Metro Detroit business owners evaluate their options with no commission pressure. Book a free consultation to discuss your specific situation.
Broker vs. DIY FAQ
How much does a business broker charge in Michigan?+
Most Michigan brokers charge a success fee of 8-12% for businesses under $2M and 5-8% for $2M-$10M deals. Some also charge an upfront retainer of $5K-$25K. On a $3M sale at 8%, that's $240,000. The key question: will the broker's involvement add more than their fee in final sale price and deal quality?
Can I sell my business without a broker?+
Yes, but you'll need to invest significant time in preparation, marketing, buyer screening, negotiation, and due diligence management. Owners who sell without brokers typically already have a buyer in mind (employee, competitor, customer) or have professional advisory support (attorney, CPA, exit advisor) to fill the gaps.
What is the difference between a business broker and an exit advisor?+
A broker markets your business, finds buyers, and negotiates deals in exchange for a commission. An exit advisor helps you prepare, value, and navigate the entire exit process (including working with or without a broker) typically for a flat fee or hourly rate. An advisor's incentive is aligned with your best outcome, not with closing a deal to earn a commission.
How do I find a good business broker in Metro Detroit?+
Look for Certified Business Intermediary (CBI) credentials from the IBBA, 5+ years of experience in your industry, a track record of completed transactions (ask for references), and clear fee terms. Interview at least 3 brokers and compare their marketing plans, buyer networks, and deal structures. Avoid brokers who promise unrealistic prices to win your listing.
Ready to Take the Next Step?
Find out how ready you are or talk to an advisor about your options.