In rural markets, it might make sense for the person that would sell your home to also sell your business, because there simply is not another option. But living and working in Denver, if a person says that they can sell both your home and your business, I would run, not walk, to the mountains! There really should be no overlap between the services provided by a real estate agent or commercial broker and the services provided by a business broker.
A real estate agent or commercial broker in Denver and a business broker in Denver do have one thing in common though! They are all licensed real estate agents in the great State of Colorado. However, this is the beginning and end of their overlap. The main identifying difference between real estate agents or commercial brokers and business brokers is their specialization. Real estate agents, as most of you well know, specialize in facilitating the buying and selling of residential properties, while commercial brokers work in business properties. A business broker specializes in facilitating the buying and selling of businesses.
Why are we focusing on the difference between a real estate agent (or commercial broker) and a business broker, you might ask? Well, it is not uncommon for us to learn of and deal with situations where a seller has an interest in putting their business on the market and a friend, who is also a practicing real estate agent, offers to provide services for them. So that seller chooses to work with their friend rather than work with a brokerage firm. Six months later, we receive a call saying their business is in terrible shape, the sale of their business has not been kept confidential and they are in the midst of a fairly trying situation. If they had chosen to work with a reputable brokerage firm, their business could have been sold already, given the market average of 7 months!
As business brokers, while we are licensed real estate agents, we have spent a lot of time being trained and working through continuing education so that we have the best tools to sell a business in the current market. The skill sets of a business broker versus a real estate agent (or commercial broker) are completely different and thus their services should be used as such. As brokers, we understand our core competencies as well as our limitations. These core competencies involve an excellent understanding of how to market and present a business for sale. We understand the real reasons for and how to keep full confidentiality surrounding the sale of your business. As business brokers, we also have finely honed skills in the complexities of accounting and negotiating. And finally, our marketing channels and networks are completely separate from a real estate agents.
Our limitations, of course, are that we are not skilled in the buying and selling of homes or commercial properties and we don't pretend to be. We do not have contact lists of homebuyers looking to purchase a home in Littleton, CO or lists of companies preparing for a future office building move. But we do have access to contact lists of buyers looking to purchase a small to mid-size business in the Littleton-Englewood-Greenwood Village area of Colorado. And we will work hard to identify sellers we can connect them with!
Another appreciable difference between a real estate agent (or commercial broker) and a business broker, is that brokers hold memberships with organizations, completely separate from the real estate industry. The main organizations that Transworld supports are the Colorado Association of Business Intermediaries (CABI) and the International Business Broker Association (IBBA). These organizations provide industry support and a great network for brokers. They also offer many of our continuing education and training opportunities and help us stay connected with the pulse of the market and industry regulations.
The bottom line is that real estate agents and business brokers are two separate lines of work and service. You wouldn't hire a car salesman to sell your business because they are not versed in the industry of business sale. So why would you hire a real estate agent or a commercial broker? It is the same concept. Our ultimate goal is that sellers choose a professional business broker with the proper training, expertise, and network to sell their business, so they can receive the greatest return on their investment. Even if Transworld is not the business brokerage firm for you, we can introduce you to local and national professionals who might be!
For more information on?the Transworld service offerings and how we can help you sell your business visit our website at www.tworlddenver.com or schedule a consultation today!
Al Fialkovich is the Managing Director at Transworld Business Advisors of Denver. In his role, he oversees a team of brokers and the sale of an average of 25-30 small to medium size businesses each year. His focus has always been on running seamless transactions, fostering constant and honest communication and maintaining strong relationships with his clients. This commitment has earned Al multiple awards for Transworld, but most of all it has brought him true satisfaction in his career. If you are interested in buying or selling a business contact Al today!