People First - Broker Relations

I recently reached out to a broker that I liked working with, even though the deal that brought us together didn't pan out. I wanted to ask him his fee structure so I can keep his expectations in my frame of mind - he mentioned wanting to bring me more deals, so I needed to know what terms he works with to keep the relationship?mutually beneficial.

• The range for broker fee on his side is usually 8-10% of gross sale price. Here's what he said:
• “I usually quote 8%, and would say half the time I have to split that with a buyer's broker.
• Other half there is no other broker, I find the buyer on my own.
• Costs on my side usually include professional pictures, and online marketing fees from BizBuySell, Loopnet, Crexi, etc.
• I do all I can to support the business owner with Contracts, Negotiating, Closing Process, New leases with landlord, and finding Bank financing.
• For Seller financing and broker fees, it is a mixed bag. The best outcome for the broker is - full commission paid out from the down payment received by the seller. Other times, it is 50% at closing, 50% when the lien is paid off. Many tiered variations in between.”

Was happy to hear his flexibility, thanked him for being transparent, and let him know more about my specific deal box. To which he responded that he's gathering financials for another deal that I was the first on the list to see. (I was quickly able to say no to the deal, but that's another story).

A big takeaway in building strong business relationships is that you make the effort to ask "What are they getting out of this interaction?"

This applies to partnerships, advisors, brokers, and sellers during deal negotiations.

During the initial deal, I spent a LOT more time building this relationship. I worked on his schedule, cooled off and made time to edit before sending any "harsh" emails, and made time to call him and answer his calls. I made the effort to fly to another island to meet him and the owners of that business. Plus I found out that he has a love for classic cars and hooked him up with a local friend that I know who buys and sells classic cars fairly often.

Pro Tip: Sometimes giving knowledge for a passion outside of a business transaction goes a long way too.

He's said multiple times he knows that I'll do a lot more deals, and hopes to send more my way.

Spending time with people is an investment. Act like it, and you'll see returns.

MORE RETURNS

A week later the same broker reaches out to send me a deal that is potentially within my deal box and preferred industry from a different broker - he’s sending me deals that he’s not going to get a red cent off of!

I responded asking if he knows the broker and could help me with an introduction - and being the awesome guy that he is said that he would set it up! That's how I can compound the relationship I’ve fostered with one person to add credibility to the next relationship - leapfrogging and reducing the time it will take to build that baseline of mutual trust.

With some emails back and forth regarding the deal, he also gave me some industry insight on metal fabrication (part of this HVAC company). The business on his island doing the same is “printing money” since it’s a niche and a need where other businesses have to import all their resources from the mainland. Potentially amazing deals like this land in my lap simply because I spend time building and preserving the relationship I have with a single person.

Just imagine what happens when you take this approach with every relationship. I’ll repeat myself for effect:

Spending time with people is an investment. Act like it, and you'll see returns.

When you're searching for the RIGHT business acquisition, cultivating strong relationships is key.

Finding ways for your wins to directly benefit the people you interact with will pave the way for ongoing collaboration. By investing time and effort into relationships — acknowledging personal interests, keeping open communication, and even meeting face to face will set you apart. You'll not only gain access to better deals and more resources but also position yourself to negotiate more favorable terms in future transactions.

I can promise you that I'm not full of hot air. I really love building relationships, helping people get deals, and sharing my knowledge to potentially save them terrible headache in the long run.

You don't have to take my word for it - I proudly share my testimonials here.

If you'd like to help me add to that list book a quick intro call and we'll discover the RIGHT business buying strategy together.

And as always - here's to your lasting success,

Sage Price