How Much Do Brokers Charge to Sell a Business?

A decision to sell a business is a milestone, full of big ambitions and (understandably) a few jitters. With so much at stake, understanding how much do brokers charge to sell a business empowers sellers with control over their financial future.

Highlights

• How much do brokers charge to sell a business: Business brokers typically charge 5% to 15% commission, with an average around 10% of the final sale price.
• Smaller businesses will often see higher percentage commission, while larger deals may use a tiered or sliding scale.
• Flat fees or hourly rates are available in select scenarios, especially for consulting or lower-touch deals.
• Most brokers are paid after a successful sale, but many require a retainer or upfront fee for services like valuation and marketing.
• The size, industry, and complexity of the business—as well as the broker’s track record and market conditions—can all affect the final fee.
• Additional costs may include legal, accounting, due diligence, and marketing expenses, which are often separate from broker commissions.
• Broker fees are negotiable; savvy sellers will compare, question, and negotiate for the best terms and alignment of incentives.
• The seller usually pays broker fees, which may be tax-deductible depending on the specifics of the transaction.
• Choosing the right broker—based on fee transparency, experience, and fit with the business—can lead to a smoother sale and optimized outcomes.

Understanding How Much Do Brokers Charge to Sell a Business

One of the first steps toward a successful exit is grasping how much do brokers charge to sell a business, why they matter, and how to avoid pitfalls that drain sale proceeds.

A clear idea of business broker fees can mean the difference between a satisfying payout and closing table surprises. Ready to step into this new chapter with confidence? Here’s an in-depth look at the true cost of professional guidance when selling a business.

Why Business Broker Fees Matter

Professional business brokers are the engines behind many successful sales, connecting sellers to motivated buyers, handling negotiations, and navigating deals through the closing process. These pros:

• Present businesses attractively to maximize sale value
• Manage marketing, vet buyers, and negotiate offer terms
• Expedite due diligence and coordinate legal paperwork

Yet, broker fees directly reduce the net proceeds a seller receives upon closing. Imagine finishing a marathon only to find a surprise toll booth at the finish line—understanding the toll in advance is vital! By being informed, sellers can plan, budget, and negotiate with confidence.

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Common Business Broker Fee Structures

Brokers have a handful of fee models, each with its own pros, cons, and nuances. Here’s the full breakdown for the question: how much do brokers charge to sell a business?

1. Commission-Based Fees

Most business brokers earn a success-based commission payable at closing.

• Standard commission rates: 5% to 15% of the total sale price (BizBuySell), with Main Street businesses (up to $1 million) typically paying 8% to 10%.
• The average fee hovers around 10%, but commission can climb higher (up to 20%) for very small businesses or those in certain niches.
• Example: A coffee shop sells for $250,000. At a 10% commission, the broker receives $25,000.
• Some brokers require a minimum commission, usually $10,000–$15,000, regardless of sale price.

2. Tiered or Sliding Scale Commissions

Larger businesses or more complex deals often trigger sliding scale commissions:

• The fee percentage decreases as the sale price increases.
• An example structure:
• 15% on the first $500,000
• 10% on the next $500,000
• 5.5% on $1 million to $5 million
• For a business selling for $1,200,000:
• 15% of $500,000 = $75,000
• 10% of $500,000 = $50,000
• 5.5% of $200,000 = $11,000
• Total fee: $136,000

Tiered structures reward brokers for big wins but curb excessive percentage-based costs for larger transactions.

3. Flat Fees and Hourly Rates

• Some brokers offer fixed-fee packages or charge hourly rates—these are common when a seller only wants consulting or limited support:
• Hourly rates range from $50 to $300+
• Flat fees cater to straightforward, low-value, or quick-turn sales

Pros:

• Predictable spending; easier budgeting
• No surprises due to sale size
  Cons:
• May lack the full-service engagement and buyer network of commission brokers

4. Retainers and Upfront Fees

• Many brokers require an upfront fee (sometimes called a retainer or engagement fee), between $1,000 and $50,000.
• Retainers often cover business valuation, creation of marketing materials, and buyer vetting.
• Some engagement fees are non-refundable; others convert to commission at closing. Always clarify before signing!

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Factors Influencing Business Broker Fees

Fee structures aren’t set in stone. Here’s what can affect how much brokers charge to sell a business:

• Business size: Smaller deals mean higher percentage rates.
• Industry: Specialty sectors (e.g., SaaS, healthcare) may incur higher fees.
• Business complexity: Multilocation, regulated, or distressed businesses demand more work, often meaning higher fees.
• Geographical market conditions: Cities with more brokers and buyers may drive rates down; niche markets may drive them up.
• Broker reputation and track record: Seasoned, high-success brokers are likely to command premium rates.
• Amount of prep and marketing: Deals needing lots of buyer vetting, custom marketing, or extensive due diligence may come with additional charges.

Negotiating Broker Fees: Strategies and Tips

The power of negotiation is real, and nowhere is it more important than when budgeting for the sale of a business. Broker fees aren’t just presented—savvy sellers question, compare, and negotiate how much do brokers charge to sell a business before signing an engagement agreement.

Checklist: How to Negotiate Broker Fees Like a Pro

• Request a written explanation of all fees up front.
• Ask about minimum fees, additional charges, and tiered commissions.
• Clarify what services are included in the fee—are marketing, buyer vetting, or due diligence assistance extra?
• Seek alignment of incentives; commissions based on successful closing are preferable.
• Compare offers from multiple brokers, factoring in both total cost and value provided.
• Don’t be shy—brokers expect negotiation! If a fee feels high, ask for justification or negotiate for added support/services.

Hidden Costs and Additional Expenses

Broker commissions are just one piece of the closing cost puzzle. Expect other expenses, too, including:

• Marketing or advertising: Premium listings or digital campaigns to attract buyers often incur extra charges.
• Legal and accounting: Due diligence and contract reviews can run $2,000–$10,000+.
• Valuation services: Sophisticated business valuation may be bundled in, or charged as a separate fee.
• Escrow and closing fees: Local regulations or escrow requirements can add hundreds or thousands.

If you’re wondering how much do brokers charge to sell a business, it’s important to request a breakdown of ALL fees and likely third-party expenses so there’s complete clarity on net take-home proceeds.

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Case Studies: Real-World Examples of Broker Fees

Case Study 1: Main Street Retail Shop

• Sale price: $400,000
• Broker fee: 10% commission ($40,000)
• Additional expenses: $5,000 legal/accounting, $1,500 marketing
• Takeaway: Standard percentage with moderate third-party costs; planned and straightforward.

Case Study 2: Tech Company with Sliding Scale

• Sale price: $1,500,000
• Broker fee: Tiered (15% on first $500,000, 10% on second $500,000, 5.5% remainder)
• $75,000 (15% of $500,000)
• $50,000 (10% of $500,000)
• $27,500 (5.5% of $500,000)
• Total commission: $152,500
• Takeaway: Sliding scale dramatically impacts net proceeds as deal size grows.

Case Study 3: Consulting Via Hourly Fee

• Consulting engagement for a small startup: $150/hour, 30 hours ($4,500 total)
• Provided valuation, advisory, and some marketing—seller managed the rest.

Key lesson: Hourly or fixed fees best suit sellers who only need guidance, not full-service brokering.

Making Informed Decisions on Broker Fees

Preparation and empowerment pay off in every business sale. Understanding how much do brokers charge to sell a business is more than reading a percentage on a checklist—it’s about transparency, negotiation, and strategic planning. The right broker isn’t just the cheapest, but the best fit for the unique circumstances and goals of the seller. Find your perfect partners and resources at the Small Business Expo.

How Much Do Brokers Charge to Sell a Business FAQs

What is the average commission a business broker charges?

The typical commission hovers between 5% and 15% of the sale price, with 10% common for Main Street businesses and lower rates for larger deals. Specialty markets may range higher, answering the question how much do brokers charge to sell a business.

Are broker fees negotiable?

Yes—broker fees are almost always negotiable. Sellers are encouraged to interview several brokers, compare service offerings, and seek an arrangement that prioritizes both value and closing success.

Who typically pays the broker’s fee?

In most sales, the seller pays the broker fee from the closing proceeds. In some high-stakes or unique markets, fees may be split or negotiated as part of the purchase agreement.

Are business broker fees tax-deductible?

Broker commissions and fees may be tax-deductible as selling expenses, but sellers should consult a professional tax advisor to unpack specific implications for their business and local regulations.

How do I choose the right broker for my business sale?

Focus on the following criteria:

• Experience and track record in your industry
• Fee transparency and flexibility
• Breadth of network and buyer connections
• Fit and trust—the ability to communicate openly and work collaboratively