I sold my commercial cleaning company last year without using a broker. It took about five months from listing to closing. I found the buyer through a local industry Facebook group and used a business attorney to draft the purchase agreement. Total cost was around $2,500 in legal fees. The buyer's lender required an appraisal, which I paid for ($3,500). No commissions. I'm not saying brokers aren't valuable for some situations, but for a business under $500k in value, the math didn't work for me. Happy to answer questions.
Selling
How I avoided paying a dime in broker commissions
Did you have to deal with confidentiality? That's the parrt that worries me most about selling without a broker. I don't want my employees finding out before the deal is done.
How did you handle the valuation? I'd be worried about leaving money on the table without a professional opinion.
Confidentiality was manageable. I had interested parties sign a simple NDA before sharing any financials. Only two people inside my company knew: my office manager and my accountant. The Facebook group is more private than you'd think—it's a closed group for cleaning business owners, so not public.
Interesting. I tried going the no-broker route with my landscaping business but got stuck when it came to negotiating the lese assignment with my landlord. That part was a nightmare. How did you handle commercial lease transfer?
Good point about the lease. I hadn't even thought of that.
I used a broker when I sold my restaurant. Cost me 10% but she handled everything—the lease, the liquor license transfer, the employee transition. For me, that was worth the peace of mind. But I can see how for a simpler business it might not be necessary.
What was your asking price vs. final sale price? I'm curious about the negotiation gap without a broker.
Asking was $395k. Closed at $370k. I had two serious offers, so there was some leverage. The buyer's lender required a third-party appraisal, which came in at $380k, so we met in the middle. Honestly, I think a broker might have gotten me closer to $400k, but after the 8-10% commission, I'd have netted about the same. And I liked controlling the process.
That's a big assumption that a broker would have gotten you more. I've seen brokers just list and wait. A lot of them don't do much outreach.
I ended up paying a lawyer $1,200 to negotiate my lease assignment, so it is doable. But it added three weeks to the timeline.
What about the due diligence process? Buyers always want tons of documents. Did you have a system for that?
I created a shared Google Drive folder with standard categories: tax returns, P&L statements, client contracts, equipment list, employee roster (with names redacted), and lease. That covered 90% of the requests. The buyer's accountant asked for a few additional things, but nothing crazy.
Did you use a business valuation expert at all, even just for a consultation?
No expert. I used a simple multiple of seller's discretionary earnings. I looked at comparable sales in the industry from online listings and talked to a few other owners. It's not perfect, but it's what most small business buyers use anyway.
This is all helpful. I'm leaning toward trying it without a broker now. Worst case, I can always hire one later if it doesn't sell.
One more thing—make sure you have a good escrow arrangement. That's another area where a broker can help, but your attorney can set it up.