Business Sales and Acquisitions

Frequently Asked Questions

PacificRealtors.net

818-991-5200



Q. How long has your firm been licensed to sell businesses?

A. Since 1987.

Q. What geographical areas do you cover and what size transactions?

A. We represent buyers and sellers of businesses located in Los Angeles County and Ventura County where the sale is at least $250,000.

Q. Does your firm provide business appraisals?

A. No. While we will estimate the value of any business where we are representing a buyer or seller, our valuation is not the same as a full appraisal prepared by a licensed appraiser that specializes in business appraisals. Only a third party appraiser can be totally objective because he or she will not earn a commission upon the sale of the business. Any broker who represents himself as being 100% objective when it comes to establishing the value of a business is either unrealistic or dishonest.

Q. Is the primary factor in valuating a business the net income before taxes?

A. Yes, but there are other important factors to be considered such as:

Is the net income trend increasing or decreasing, and if so, why?
   
Is the industry growing or shrinking?
   
Is the business location improving or deteriorating?
   
Is the income of the business diversified, or is it generated by only a few sources?
   

Q. What do business brokers charge for selling a business?

A. The range is from 8% to 12% with 10% being the average. The commission will be set by supply and demand like any other price.

Q. Are you able to assist us with financing the sale or purchase of a business?

A. Yes. When we are representing the buyer or seller of a business, we will assist you by either providing the financing or obtaining it.

Q. Does Pacific Realtors cooperate with other business brokers?

A. Absolutely.

Q. When marketing a local business, do you target potential foreign buyers?

A. Absolutely. In Los Angeles County and Ventura County foreign buyers and immigrants make up a large percentage of the buyers of small and medium sized businesses. While these buyers come from all nations, in our experience, most are Chinese, Korean, Japanese, Mexican, Persian, and Indian (Republic of India). We also target other business brokers, private equity groups, and many others.