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What Does It Mean To “Buy A Listing” in Business Brokerage?

Ouch!  Well, I’ll tell you.  In real estate “Buying a Listing” is when someone tells you they can sell your property  for more than it’s worth just to get your listing.  Oh man!  that is painful!

I wish I could say it was few and far between, but I think we all know, given the crazy speculation and “flippers” in real estate, it’s not really so rare.

In Business brokerage, however…

A totally different meaning of this phrase in my World of Business Brokerage and ‘light’ M&A.   I’ll explain “my definition”  as relates to Business Brokerage in a minute.

First , let me tell you what you came to read this Blog for!

You Googled for “What Does It Mean To “Buy A Listing?” , I’m guessing because you are ticked off at how long and maybe never, that YOUR Listing ain’t selling!  Am I right?

So a couple of Quickies for your check list:

#1  And I do mean NUMBER ONE!

Make sure your property is priced right based on recently sold (not listed) properties if available.

You know I’m talking real estate, right?  But, if you could do a “comp check” with regard to a selling your own business, probably through a broker, this is still valid.  Real estate comps are 100X easier to find , because they are so many and so much real estate info is commonly available.

Hint:  This is a good reason to get in touch with me to sell your company.  Please read on…
#2 Regarding real estate, but also applied to Business Brokerage…If your starting price is too high you will lose buyers.  (Because there is a “market advantage of a new listing”.

#3 Thus: Once you miss buyers and drop your price you are then “Chasing the Market.”  Ohhh!  That’s bad!

#4 It’s only to be expected that after a property has had multiple price reductions buyers may view the property as inferior.   Can I get a Witness?

#5 Lastly, let’s get real… A bank will only finance, at best, 80% of appraised value in real estate.  True, right?   Soooooo….. Even “IF” you find a buyer willing to pay more than market value, the deal may still fall through because …. they cannot find financing.

In Business Brokerage, while all that is just as important, the term “Buy A Listing” is quite different.  It means, me, the Broker, buys your business.

This usually happens after it has been listed for many months and despite great activity, it has not sold, you want or need it “closed” and transferred and the broker (me) says, “Well, shucks! I know how good it is even if the buyers are too dumb or too doggone picky! I’ll buy it!”

Most business brokers are barely able to keep up with their own overhead and advertising budget, much less buy your company, BTW.

Pro Biz is a bit unique in this regard.  More on the next BLOG!

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