Broker fees

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by a searcher from Murdoch University
in Chicago, IL, USA

2yrs ago

Broker fees

What are the market normal fees for a broker to sell a small business? We have a Plumbing company and we are at around 900k EBITDA and I'm interested to learn the following:

1. What percentage do brokers normally charge on a deal this size?
2. Are there generally any upfront or monthly costs?

I welcome people to write about their experiences. Thank you

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reply by a searcher 2yrs ago
from Johns Hopkins University in Los Angeles, CA, USA

Most business brokers charge up to 10%, investment banks which specialize in larger transactions charge in the 5% range. Business Brokers take on dozens of clients and send out their listings to a wide range of buyers. Investment Bankers are more focused on their engagements. Happy to chat further if you like.

reply by an intermediary 2yrs ago
from University of British Columbia in Vancouver, BC, Canada

5% is common. Can go higher depending on the brokerage. They usually have charges for the marketing material they would prepare. It would depend on individual terms if they would charge them upfront or as part of their commission later on.