How Much Money Does A Business Broker Make? A Career Math

A business broker is a highly demanded specialist that makes selling a company easy. These experts have experience in many different industries. From marketing, sales, and negotiations to business valuation and legislation, business brokers have to cover sizable ground.

Business owners usually don’t have sufficient expertise to sell companies on their own. The process is so intricate that even the smallest mistake could lead to a failed deal. Business brokers can handle the sales process from scratch, using their connections and experience to ensure smooth negotiations.

A business broker specializes in facilitating the buying and selling of businesses, while a CIS Statement caters to the unique financial requirements of self-employed individuals in the construction industry.

Business Broker: Salary

In 2021, the average annual salary of a business broker is $125,000. It’s important to understand that business brokers are different. Some handle the entire process on their own while others hire various specialists to do it.

If you are planning to get a job at a brokerage firm, your starting salary is likely to be around $70,000. However, with time you can get it up to as much as $200,000.

Business Broker: Percentage

After the deal is finalized, the business broker receives a percentage of the sales price. If you are working on your own, this fee is yours to keep. If you have a brokerage firm, you need to pay salaries.

The commission is usually between 5% and 12% of the price paid at closing. Its size can depend on several factors, including the broker’s expertise, the complexity of the deal, and the final sales price.

According to the Orlando Business Broker, the fee can also vary based on the size of a company you are selling.

How can you make more money as a business broker?

While business brokers have high salaries, becoming one isn’t easy. To choose brokerage as a career path, you need to be ready to learn. High-paid brokers have extensive experience in many areas. Some of it requires years to obtain.

IBBA Membership and Certification  

Besides having experience, the business broker has to get certified. Brokers who is Certified Business Intermediary (CBI) is likely to get more clients than a broker who doesn’t have proper certification.

The International Business Broker Association (IBBA) certifies business brokers who can prove their experience, expertise, trustworthiness, and willingness to provide top-notch services. To become a CBI, you need:

•         IBBA membership and good standing
•         68 credit hours in IBBA University or M&A Source courses
•         Pass a CBI exam
•         Attend at least one IBBA conference

If you’ve been working as a business broker for at least some time, you can try and obtain this certification. If you are just starting out, you probably don’t have the necessary IBBA membership standing.

Another certification you may want to consider is a realtor’s license. In some states, you are obligated to have this license in order to sell businesses.

Experience

The more experience you have, the higher your salary is likely to be. Business owners are usually looking for brokers who already have at least five years of experience selling businesses. You can get this experience by working at someone else’s brokerage firm.

While your salary may not be as high as expected, you can gain valuable knowledge and start your own business.

Web Presence

If business owners can’t find a broker by asking for recommendations from people they know, they go on the internet. That’s where you should have a solid presence. A poorly designed website will push potential clients away.

You need to take the time to create a user-friendly website that has all the necessary information about your experience, past deals, and qualifications.

Marketing

Many business owners are looking for brokers who have marketing experience. Since marketing is an integral part of the sales process, you need to know how to do it. If a client can’t get all services in one package, they may decide against working with you.  

Besides selling companies on your website, you should work with other business listings. Learning how to do that is integral to getting higher fees.

The Takeaway

A business broker is a high-paying job. However, it requires substantial experience, expertise, and qualification. To earn high fees, you need to become an expert in different niches, get certified, and obtain experience by working with other brokers.

Becoming a business broker is a long journey. Once you complete it, you can have the job of your dreams.