How long do Brokers typically work with a client before bringing them to market?

searcher profile

December 03, 2024

by a searcher from Auburn University in Auburn, AL, USA

How long do you typically work with a client before bringing them to market?

Throughout my search, I’ve noticed a wide range of approaches. Some advisors seem to have minimal prior relationships with their clients - often originating from a cold call or inbound inquiry - while others appear to have built relationships over several years.

To clarify, I’m not asking about the "prep stage" before running a process or listing a business, but more about the length and depth of the relationship between the advisor and the owner before formally engaging to sell.

I expected most of the relationships to be multi-year, but interested in hearing what is actually the case in the market.

0
10
61
Replies
10
commentor profile
Reply by an intermediary
from University of Missouri in Kansas City, MO, USA
Excellent question without an easy answer. There are tons of variables that can come into play that can determine how long a broker will work with a client. For example, if there are problems with the financial reporting, a broker may refer a client to an accounting firm to get the books in order. Depending on the severity of the reporting issues, that can be a matter of days or even months. If the business is big enough, it might even require a sell side quality of earnings audit which can take from a couple of months to 4 to 6 months depending. In other cases where the client's business has declined in either revenue or profit or both, the best decision might be to wait anywhere from 3 months to a full year for the business to recover and for at least TTM to improve to a level that could support a proper valuation. Every business is different so the factors that can extend and engagement or delay it are nearly infinite. But a good broker or investment banker will hang in there with you and help guide the recovery or repair process.
commentor profile
Reply by a professional
in Granbury, TX, USA
depends. if it is a warm referral pretty quick. we make sure the owner likes the price we think it can bring in first...so if it a SBA sized deal, we have a bank run the numbers...then, if they want to move forward we do...i've had others take months before the owner was ready...really up to the seller...i stress that when the deal is over, the buyer and seller have to live with what happens next...so i dont pressure them into selling unless they are ready to go...if they dont like the numbers, then we don't try to list it for higher and hope the it brings in the right offer
commentor profile
+8 more replies.
Join the discussion