How to Buy a Business Without a Broker

Business brokers perform a variety of tasks that range from simply introducing a buyer and a seller to managing every legal and financial detail during the transaction. When you buy a business without a broker, the process is similar to purchasing a home without a Realtor. In exchange for forgoing a broker's help, you are responsible for finding the business you want to buy, sorting through legal paperwork, financial statements and valuation claims made by business owners. If you can employ a good team of legal and financial advisers who can aid in your acquisition, the seller can save commission fees by avoiding a broker-based transaction. In return, you may get a better price for the business.


  1. Image titled Develop Critical Thinking Skills Step 27
    Determine the type of business you want to buy. Conduct an assessment of your personal goals, interests and time availability. New business owners have a better chance of success if they buy a business in an industry they understand.
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    Conduct research on the industry you want to pursue. Preliminary research is your responsibility, with or without a business broker. Begin by ensuring that the market in your geographic area isn't saturated with similar operations. Consider embarking in an industry with sales that aren't limited to one region; this ensures opportunities for additional revenue streams.
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    Assess your financial situation. Know how much money you can realistically put toward buying a small business, then research how much money it costs to buy one in your chosen industry. Whether or not you utilize the help of a business broker, you must investigate the industry yourself.
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    Assemble a personal financial statement. This document displays your liabilities and assets. Business owners always ask for this to qualify potential buyers. Buyers can get help assembling this document from small business consultants and sometimes business brokers.
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    Research small businesses for sale. Since most business sales transactions are through word-of-mouth, ask industry leaders if they know of any businesses for sale. Start with your local chamber of commerce and related trade association. Also peruse trade publications and small business sales websites such as
    • Some business brokers also search newspaper classified advertisements to locate businesses for sale. Search online editions of newspapers to locate businesses.
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    Choose a business to carefully examine. Approach a small business owner and express your interest in buying their operation by offering to sign a non-disclosure agreement (a promise not to share confidential information about the business).
    • Business brokers usually negotiate the first approach. You will need to take care of this first meeting yourself when a broker isn't involved. By foregoing a broker's services, the business seller is saving money on commission fees and may be wiling to offer a lower price.
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    Present your personal financial statement as a sign of your commitment to examine their business in closer detail. A letter of intent indicating your commitment may also be required by the buyer. While business brokers can provide letter of intent templates, you can locate them online or in business buying books.
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    Review the business history, financial statements and operating history. Ensure that the owner has acquired a wide variety of clients responsible for revenue, then look for consistent growth and steady sales with short accounts receivable time frames. Many brokers analyze this information before listing a business for sale, but without a broker's assistance you must do it yourself. Find assistance from small business consultants at your chamber of commerce office.
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    Employ the aid of a certified public accountant. A certified public accountant is the best person to determine the accuracy of the business' financial statements. A business broker will usually contract accounting services when conducting a transaction, but you can locate a qualified CPA through your chamber of commerce.
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    Examine vendor contracts and leases. Always verify that existing agreements for real estate, equipment and inventory are transferable to a new owner. While some business brokers can review this information for potential buyers, an attorney is the best person to help with this process.
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    Look at employment records. Ensure the business doesn't have employee lawsuits or consistent claims against the operation by current and past employees or government entities. Some business brokers may include this research in their fee but you can find this information yourself by contacting your state employment office.
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    Decide whether or not to acquire the business. If you choose to move forward with a purchase offer, have a business sale contract ready. A business broker's main purpose is to prepare contracts during a sale. However, you can handle this step by hiring a lawyer who specializes in creating business contracts. Your sales contract will describe what you are willing to pay for the business.
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    Expect the business owner to counter-offer. Without a business broker, you will be responsible for negotiating a final offer. Be ready with a backup contract that ensures you get a good deal while making the owner happy with the purchase. New contracts can be obtained through your attorney.
  14. Image titled Write a Letter for Proof of Income Step 13
    Notarize the business sales contract. Once all parties agree on a price, take the sales contract to a notary.
    • Next, transfer all other legal agreements into your name.
    • Conclude the sales process by following the transition schedule you and the business owner have agreed upon.


  • Anyone can say they are a business broker. With the exception of a few states, this field has few regulations or licensing required of its practitioners unless real estate is involved in the transaction. Instead of relying on a business broker for your small business purchase, employ the aid of licensed professionals such as CPAs and lawyers to help in your acquisition.


  • Do not waste your time on a small business owner who cannot present a detailed prospectus and legible financial statements. Inability to present these critical selling tools is a sign of disorganization within the operation.

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Categories: Buying & Forming a Business