In order to sell one’s business using the services of a business intermediary, a representation agreement is almost always required.
For the owner of the business, signing the agreement authorizes the broker to start the process of selling the business. This simple act of signing represents the beginning of the end of ownership, although the end is not determined until the owner accepts and then closes the deal. For most business owners, it means heading into uncharted territory after the business is sold. For many it also signifies the end of a dream. The business owner may have started the business from scratch and/or taken it to the next level. A little of the business owner may always be in that business. The business, in many cases, has been like a part of the family.
For buyers, the signed agreement can be the beginning of a dream, an opportunity for independence and the start of business ownership. The buyer looks at the business as the next phase in his or her life. Pride of ownership builds.
So that simple piece of paper – the representation agreement – is the bridge for both the seller and the buyer. Although representing just one party or the other in any particular transaction, the business broker looks at that piece of paper through the eyes of both the buyer and the seller, working to help both parties progress through the business transaction process into the new phase of their lives.