Selection of Local or National Representation to Sell a Business

May 16, 2019

May 1, 2019 I successfully facilitated the sale of a privately held company in a stock sale for $7,500,000.  The sale, by the founder of the business, was retirement motivated. Unfortunately, several calendar years passed between the time the entrepreneur first engaged professional representation to sell his business and when the transaction was completed. IBA was one of three business brokerage firms engaged during the time period to sell the business. IBA was the only one of the M&A firms with a corporate headquarters in the same state as the business.

It is possible to sell a company virtually.  Transactions of that nature are professionally facilitated monthly in the United States.  It is also possible to travel from Redmond to Seattle during rush hour in a half hour, if optimal conditions exist.

Owners of privately held companies frequently make executive decisions related to hiring employees and selecting service providers.  Every business owner can tell stories of correct and bad decisions.  The selection of an intermediary to sell a business is one of the most significant decisions made by an entrepreneur. The decision will have financial implications and has the potential to impact the lives of employees, customers, and vendors.  Selection of a business broker should start with an assessment of knowledge, experience, and their professional negotiation & deal facilitation skill set.  Only intermediaries who receive a grade of “A” in this assessment should be considered in the final group for representation.

A secondary consideration in the selection of a business broker is their physical location. The following are three reasons to seriously consider the selection of a local business broker to professionally sell a privately held company or family business.


Communication between a business sale intermediary and their client can occur in written form, virtually, or in person.  It is very important that a business broker has the ability to communicate sophisticated business concepts in writing.  A poorly written email can cause confusion and potentially negatively impact negotiations and/or a transaction.  It is also critical for conveying positions and administrative processes accurately.  It is strongly encouraged that email correspondence with an intermediary be evaluated for comprehension & content prior to engaging a business broker.  Strong written skills in the frequently employed communication venue of email correspondence are critical for transaction success for both local and national representation of a entrepreneur in a business sale.

Telephone and video conference communication are also commonly employed by intermediaries in business sale transactions.  It is important that a business broker with articulate, persuasive, knowledgeable verbal communication skills be selected for representation.

The menu of communication choices for a nationally based business broker traditionally stop after written & virtual verbal communication, except in the later stages of negotiations. This is not the case with local representation.  A local business broker has the ability to meet with their client and/or potential buyers in person. The sale of a business is potentially a life changing decision for both the seller and buyer in the transaction. The ability to meet, discuss, problem solve, and listen in person allows for enhanced communication. An email can convey an issue in “black & white” and has the potential to rub parties the wrong way due to its flat nature. Once trust & communication between parties are damaged they are difficult to repair. A telephone conversation can be held without receiving the full attention of the other person.  A meeting allows parties to discuss and problem solve through issues collaboratively to achieve a “win-win” outcome.  A business broker that conveys they can achieve the same level of communication virtually that they can in person is being dishonest.  Think of a child that has had their first fender bender.  Would you want to discuss the situation as a parent via text, phone, or in person.  Multiply the significance of the discussion several fold and make it about hundreds of thousands or millions of dollars and ask yourself if you want to have that conversation in person with your business broker or over the phone or email.

Market Creation

The sale of a business requires both a seller and BUYER.  Creating a competitive marketplace to sell a business has the potential to enhance the sale price and terms achieved in the marketplace.  A national or local business broker has the ability to market a business for sale in the same venues.  The number of venues employed is a function of the marketing budget for the project and the broker’s knowledge.  Both parties also have the ability to employ purchased databases to identify parties that could be candidates for strategic acquisition of the company.

However, a large, well established, business brokerage firm, like IBA, offering local representation will also know who is looking for acquisitions in the local marketplace.  It is impossible for a national firm to know local buyers in every marketplace, especially given that the time a party is actively looking to purchase a business can be only a few months in length.  Every year IBA completes numerous transactions to buyers in our buyer database program. These transactions occur quicker than transactions where a buyer needs to be found through marketing efforts.  The speed of the transactions to parties with known capital resources, industry focuses, and geographic preferences also enhances the likelihood a business can be sold in a confidential environment without the transaction becoming known in the public domain before disclosed by the parties.   Information that a business is for sale in the public domain can result in the loss of customers, key employees, and/or damage relationships with vendors.


The purchase & sale of a business is a team process on both sides of the transaction.  Both parties generally engage attorneys & accountants to provide professional representation. A local business broker can likely be a source for referrals to quality, experienced professionals who have the ability to mitigate trailing liability in legal documentation, reduce the tax implications of the transaction, and/or assist with due diligence, if a party does not have an accountant or lawyer.  However, the need for local referrals does not stop with these professionals.  It is also common for a transaction to need equipment & real estate appraisals, environmental assessments, and insurance policies. It is beneficial to have a business broker facilitating the transaction that has a large Rolodex of local professionals that can be accessed to keep the transaction train moving down the line to its final destination.

There is also a fundamental rule in mergers & acquisitions. Transactions cannot close without the money regardless of the desires of the parties.   A local business broker will have an established network of bankers willing & able to fund acquisitions to refer to business buyers.  Locally engaged banks are generally more aggressive in funding transactions than banks without local “boots on the ground”.  This is true because in addition to the interest income benefits of a loan for a bank, a local bank has the added incentive to finance a deal, so they can secure business banking & merchant service relationships with the business.

I cannot begin to count the number of deals IBA has successfully facilitated that were destined for failure because we had an established working relationship with local lenders and attorneys who were willing to listen and problem solve through issues collaboratively, often over a cup of coffee in person.

The “best of the best” in mergers & acquisitions have the ability to facilitate transactions virtually without personally engaging with the parties.  IBA has facilitated transactions from California to Massachusetts and Arizona to North Carolina with limited in person engagement with our clients because our firm has market leading verbal & written communication skills.  That said, if a transaction is experiencing turbulence it is always the preference of our deep and talented team of business brokers to meet in person in one of our confidential office conference rooms or at a location of our client’s selection.  Knowledge, experience, and a high professional skill set are critical to achieving the best possible outcome in a business sale, but given those exist in the intermediary it is beneficial to have the option of sharing a cup of coffee and talking in person, if a deal is in jeopardy of failing.

IBA, the Pacific Northwest’s premier business brokerage firm since 1975, is available as an information resource to the media, business brokerage, and mergers & acquisitions community on subjects relevant to the purchase & sale of privately held companies and family owned businesses.  IBA is recognized as one of the best business brokerage firms in the nation based on its long track record of successfully negotiating “win-win” business sale transactions in environments of full disclosure employing “best practices”.