Let’s be real—if you’ve ever thought about selling a business, at some point, you’ve probably wondered: Are business brokers just middlemen taking a fat cut for doing nothing?
I know I did.
A few years ago, I had a business that was doing well—consistent revenue, solid team, decent brand recognition. But I was burnt out. Late-night strategy meetings and endless operational headaches had me questioning if this was really the life I wanted. So, I started exploring the idea of selling. Enter: business brokers.
At first, I thought they were just salespeople in suits, throwing around buzzwords like exit strategy and valuation multiples to justify their commissions. But the deeper I got into the process, the more I realized: These people actually do a lot. And their paychecks? Well, let’s just say they’ve figured out a pretty lucrative game.
So, if you’re like I was—skeptical, curious, maybe even a little paranoid that someone’s taking a bigger slice of your pie than they should—let’s break it down. How do business brokers actually make money, and are they worth what they charge?
1. The Standard Commission (a.k.a. The Big Cut)
The bread and butter of any business broker’s income is their commission on the sale price of the business. And this isn’t chump change.
Most brokers charge anywhere from 5% to 12% of the total sale price. So, if your business sells for a cool $1 million, that’s anywhere from $50,000 to $120,000 straight into the broker’s pocket.
Now, you might be thinking: Wait… I’m the one who built this business! Why am I handing over six figures to someone who just made a few phone calls?
Fair question. But here’s what most people don’t see:
- Brokers find buyers—and good ones. The kind of buyers who won’t waste your time with tire-kicking and lowball offers.
- They negotiate like sharks, making sure you get a price that reflects the true value of your business (not just what some bargain-hunting buyer wants to pay).
- They handle the paperwork—and trust me, the legal and financial red tape in a business sale is not something you want to DIY unless you have a law degree and a high tolerance for pain.
So yeah, that commission stings. But if they can get you 10-20% more on your sale price and take the stress off your plate, suddenly it doesn’t feel like highway robbery.
2. Retainer Fees (a.k.a. The “Are You Serious?” Fee)
Some brokers don’t just work on commission—they also charge a retainer fee upfront.
This can be anywhere from $2,000 to $20,000, depending on the size of your business.
Why? Because brokers don’t want to waste their time with uncommitted sellers who think they want to sell but won’t actually pull the trigger. The retainer weeds out the just browsing folks and ensures they’re dealing with serious sellers.
It also covers some of their upfront costs—things like business valuations, marketing, and outreach to potential buyers.
If you’re selling a business under, say, $1 million, you can probably avoid this fee by working with a broker who only takes commission. But if your business is in the $5M+ range, expect to pay a retainer.
3. Valuation Fees (a.k.a. The “Let’s See What You’ve Got” Fee)
Not sure what your business is worth? Brokers will happily charge you for a valuation.
Some offer this for free as part of their commission deal, but others charge anywhere from $500 to $10,000, depending on how detailed you want the report to be.
If your business is complex—multiple revenue streams, real estate holdings, intellectual property—expect to be on the higher end. But for a simple Main Street business, a basic valuation should be affordable (or free).
Pro tip: Before paying for a valuation, ask the broker if they’ll waive the fee if you sign a contract with them. Some will, especially if they’re confident they can sell your business.
4. Marketing Fees (a.k.a. “Why Am I Paying to Sell My Own Business?”)
This one can feel like a scam—some brokers charge marketing fees to cover the cost of advertising your business to potential buyers.
This can be anywhere from a few hundred to a few thousand dollars. If you see a marketing fee in your broker’s contract, ask what it actually covers. Are they running ads? Listing your business on high-traffic platforms? Creating a slick sales brochure? Or just pocketing the cash?
The best brokers include marketing in their commission—so be wary of anyone trying to double-dip.
5. Success Fees (a.k.a. “The VIP Bonus”)
Some brokers add a success fee for selling your business above a certain price.
For example, they might say: If we get you more than $2 million, we take an extra 2% on anything above that.
Sounds sneaky? Maybe. But it also gives them incentive to push for a higher sale price, which could mean more money for you in the end.
If your broker proposes a success fee, make sure it’s structured in a way that benefits both of you—not just them.
So… Are Business Brokers Worth It?
It depends.
If you have a small, local business and a buyer already lined up, you probably don’t need a business broker. Save the commission and close the deal yourself (with a good lawyer, of course).
But if you’re selling a business with real value—one that requires serious negotiations, strategic marketing, and access to high-quality buyers—then yeah, a broker can be worth their weight in gold.
The key is finding the right broker.
- Look for brokers who specialize in your industry. A broker who sells manufacturing businesses might not be the best choice for a tech startup.
- Avoid brokers who ask for huge upfront fees without a clear plan.
- Negotiate the commission and ask if they’ll structure it based on performance.
At the end of the day, a good broker makes you more money than they cost. A bad broker? Well, let’s just say you’d be better off selling the business yourself.
Ready for a successful exit? Make sure you know exactly how your broker gets paid before you sign anything. Your future bank account will thank you.