Let’s be honest, when it comes time to sell your business, it’s tempting to think, “Why pay a broker? I’ll just do it myself and keep the extra cash.”
On the surface, it makes sense. Broker fees can sit anywhere around 8–10% of the sale price. On a $1M deal, that’s $80k–$100k you’d rather keep in your pocket.
But here’s the reality most owners don’t see coming… the fee you “save” can end up costing you a whole lot more.
Take a real-world style example.
A well-established business comes to market. It’s solid—50% contracted revenue, $650k in assets, and generating around $500k in EBITDA. On paper, this is the type of business buyers love: predictable income, strong fundamentals, and tangible backing.
Yet the owner sells it privately for $1M.
Now, if you’ve been around business sales long enough, you’ll know something doesn’t quite stack up.
In New Zealand, businesses are commonly valued by applying a multiple to earnings like EBITDA. And those multiples shift based on risk, growth, and stability, but a business with recurring revenue and strong profit typically commands a higher multiple than a distressed or unpredictable one.
So what happened?
This is where selling privately can quietly work against you.
First, valuation blind spots.
Many owners either undervalue or overvalue their business when going solo. In this case, it’s likely the owner anchored to a number that “felt right” or responded too quickly to a buyer’s offer. Without access to comparable sales data or understanding how buyers assess risk and return, it’s easy to miss the true market value.
Second, limited buyer reach.
When you sell privately, you’re typically fishing in a very small pond. Brokers, on the other hand, bring a pool of active, qualified buyers and create competition. More buyers = more tension = better price. Without that, you’re negotiating in a vacuum.
Third, negotiation experience.
Buyers do this all the time. Most sellers… don’t. Experienced brokers know when to push, when to hold, and how to structure deals so you don’t leave money behind. Without that expertise, it’s easy to accept a “safe” offer instead of the best one.
And here’s the kicker.
Even if a broker charged, say, 8% on a properly marketed sale, the result could have been significantly higher. A stronger process, broader exposure, confidentiality and sharper positioning might have driven the price well beyond $1M, easily covering the fee and leaving the owner hundreds of thousands better off.
That’s the part that stings.
Selling your business isn’t just a transaction; it’s often the biggest financial event of your life. Trying to save on fees can feel smart in the moment, but if it leads to undervaluation, reduced competition, or weak negotiation, the real cost is hidden in what you don’t get.
