Ecommerce business broker
Ecommerce business broker or a direct buyer?
A broker markets your store to buyers for a fee. Here is what brokers do, how they are paid, when one is worth hiring, and when selling directly to a buyer is simpler.
What an ecommerce business broker does
A broker acts as the intermediary between you and potential buyers. Typically that means valuing the business, preparing a listing or sales memo, finding and screening buyers, running the offer process and helping manage due diligence through to closing. Some brokers specialise in online businesses. Others handle small businesses of every kind.
How ecommerce brokers get paid
Most brokers are paid a commission on the sale price, usually by the seller, and some add upfront or listing fees. BizBuySell, a business-for-sale marketplace, describes 10 to 15 percent as the standard range for businesses valued between $100,000 and $1 million, with very small businesses often on flat fees and larger ones on lower percentages. Fees are negotiable.
Whatever you are quoted, get the fee schedule in writing: the percentage, any minimum, upfront fees, how long the agreement lasts, and whether you owe a fee if you find the buyer yourself.
When a broker is the right choice
- You want several buyers competing for your business.
- Your business is larger than a direct buyer like Cadence covers.
- You don't have the time to run a sale process yourself.
- You want help with valuation, positioning and negotiation.
When selling directly makes sense
- You would rather talk to the person who makes the decision.
- You want to avoid a public listing or an auction.
- You want to avoid paying a commission.
- Your brand matches what the buyer actually buys.
Broker or direct buyer, side by side
| Business broker | Direct buyer (Cadence) | |
|---|---|---|
| Role | Intermediary between you and buyers | The buyer |
| Cost to you | Commission on the sale price, sometimes upfront fees | None. No listing, no auction, no commission. |
| Buyers reached | Whoever the broker markets to | One: Cadence |
| Process | Listing, outreach, offers, due diligence | A short note, mutual NDA, the numbers, a written offer, close and handover |
| Best for | Larger businesses and sellers who want competing offers | Small health and wellness brands, roughly $100K to $2.5M a year |
How to choose a broker if you hire one
- Ask how many online businesses in your category and size they have closed, and ask for references.
- Ask for the complete fee schedule and the length of any exclusivity period.
- Ask who the buyers are and how they are screened.
- Ask how your business stays confidential while it is marketed.
Where Cadence fits
Cadence is the buyer, not a broker or an aggregator. We buy small online health and wellness brands directly from the founders who built them, and you deal with the buyer from the first email. See also how ecommerce aggregators work.
Source: BizBuySell, "Understanding Business Broker Fees". It describes business brokers in general, not only ecommerce.
Questions
Ecommerce business brokers: the short answers.
What does an ecommerce business broker do?
A broker is an intermediary between you and buyers. They typically value the business, prepare a listing, find and screen buyers, run the offer process and help manage due diligence through to closing.
How much does an ecommerce business broker charge?
Most charge a commission on the sale price, paid by the seller. BizBuySell cites 10 to 15 percent as the standard range for businesses valued between $100,000 and $1 million. Fees are negotiable, so get the full schedule in writing.
Do I need a broker to sell my ecommerce business?
No. You can sell directly to a buyer. A broker can help if you want competing offers or don't have time to run the process. A direct sale avoids the commission.
Is Cadence an ecommerce business broker?
No. Cadence is the buyer. We buy small online health and wellness brands directly from the founders who built them, with no listing, no auction and no commission.
How do I start a direct sale to Cadence?
Email info@cadenceacq.com with your brand name, store URL and rough annual revenue. That is enough to tell whether there is a fit.