Honesty is, without question, the cornerstone of life and business. However, not everyone operates by this principle. Unfortunately, some unscrupulous business brokers and advisers continue to oversell their services or purposely mislead business owners. Their exaggerated promises and "too good to be true" claims have, for years, trapped unsuspecting business owners into agreements that rarely deliver what was promised.
Having spent over 12 years advising business owners on their exit strategies, I’ve seen firsthand the devastating consequences of trusting the wrong adviser. The reality is this: there are no shortcuts to selling a business if you want your adviser to work in your best interests and secure a deal that reflects your hard-earned success. If you’re looking for a quick sale, the process should have started last year – proper preparation takes time and effort.
Here are five of the most common false promises or exaggerations used by some business brokers, and why you should approach these claims with caution.
1. “We Already Have a Buyer Lined Up.”
This is one of the oldest tricks in the book. Claiming to have a buyer ready and waiting may sound like the perfect scenario, but it’s often a red flag. If true, this should be just the starting point of the sales process, not the solution. Securing the best deal requires competitive tension, which means engaging multiple potential buyers. Without competition, you risk accepting a less favourable offer than your business is worth.
2. Overvaluing Your Business.
A broker telling you your business is worth far more than you expected may seem like good news – but tread carefully. Overvaluing a business can be a sign of dishonesty or incompetence, and either way, it’s a major warning sign. While it’s reasonable for an adviser to aim for the higher end of fair market value, they should be able to justify their valuation with evidence. If they can’t substantiate their claims, don’t fall for the flattery. An inflated valuation often leads to disappointment when serious buyers fail to materialise.
3. Promising a 90-Day Sale.
The idea of selling your business in just 90 days is tempting – but highly unlikely. For share-based transactions, the legal and due diligence process alone can take 90 days, not to mention the months required for marketing and negotiations. Selling a business properly takes time. Any broker claiming otherwise is either setting unrealistic expectations or cutting corners – neither of which works in your favour.
4. Low Fees Mean Better Value.
Selecting an adviser based solely on low fees is a mistake. The right adviser should focus on securing you the best deal, not just offering the cheapest service. Selling your business is a return-on-investment process, and an experienced adviser can often negotiate a far higher sale price than an inexperienced or cut-rate broker. Remember, low fees might sound appealing initially, but the wrong adviser could cost you significantly more in the long run.
5. “We Have the Largest Network of Buyers in the UK.”
This is another common exaggeration. In reality, most brokers have access to the same core buyer databases. It’s not about the size of their database but the quality of their research and targeting. A successful sale doesn’t require hundreds of buyers – it requires the right buyer. Finding that buyer often means engaging with hundreds of cold targets early in the process to secure a handful of serious, qualified offers. A good adviser focuses on quality, not quantity.
How to Choose the Right Business Sale Adviser
Before engaging a business broker, do your research. It’s good practice to speak with at least two or three different advisers to compare their approach and experience. Don’t be swayed by flashy offices or claims of being the largest firm – what matters most is the expertise of the individual dealmaker who will guide you from start to finish.
A trustworthy adviser will be honest about the challenges of selling your business, provide realistic timelines and valuations, and work tirelessly to secure the right buyer at the right price. If what they’re promising sounds too good to be true, it probably is.
In conclusion, honesty really is the best policy in business. The process of selling your business is one of the most significant financial transactions of your life. Don’t let misleading claims jeopardise your future – choose an adviser who values integrity as much as you do.
If you want some positive and truthful advice about your business sale, even if you are with another broker, please contact us in confidence at info@vexus.co.uk
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