I've been running a specialty manufacturing business for 18 years. When I decided to sell, I talked to a few brokers. They all wanted 10% and control of the process. But I realized that if I handle the sale myself, I get to decide everything: who I talk to, what terms I accept, and when I walk away. It's more work, but the outcome is entirely in my hands. Curiosity: has anyone else gone the direct route and regretted it?
Selling
Why direct selling gives you total control over the outcome
I did direct selling for my HVAC company. It worked because I knew the three local competitors who might buy. But you need to be ready for tire-kickers.
Control sounds nice until you realize you're negotiating against yourself. Brokers bring buyers to the table that you'd never reach. i tried direct first and wasted six months on a guy who couldn't get financing. Eventually listed with a broker and closed in 90 days. Hard to say if that was worth the commission, but the outcome was better.
What kind of manufacturing? That affects the buyer pool a lot.
Precision metal parts for aerospace. Niche, but I have long-term contracts. The buyer pool is small and I know most of them.
Direct selling only works if you have the stomach for it. I sold my landscaping business myself and hated every minute of negotiation. But I got the price I wanted. My brother used a broker and got 15% less but slept better. Depends on your personality.
Total control also means total liability. If you misrepresent something, even accidentally, you're on the hook. A broker's paperwork and process can protect you from that that. Just something to consider.
I'm in the middle of a direct sale right now. The hardest part is keping it confidential while still doing due diligence. Employees talk. Customers talk. One slip and you've got a mutiny.
Brokers don't give a crap about your outcome. They want a closing. That's why I'll never use one again.
That's a bit harsh. A good broker can be worth their weight if they know your industry. But I agree that the wrong broker is worse than none.
CobaltKite, you clearly had a bad experience. But saying all brokers are the same is like saying all business owners are the same. Not true.
Direct selling gives you control over the process, but not over the market. You can control who you talk to, but you can't control what they offer or whether they have money. And if you're in a hurry to sell, that control evaporates.
How do you handle the legal stuff? That's what scares me about going direct. I wouldn't know where to start with the purchase agreement and escrow.
I hired a transaction attorney. Flat fee, no commission. She's reviewed everything and made sure I'm protected. It's not free, but it's a fraction of what a broker would cost.
The other thing is time. Direct selling took over my life for four months. My business suffered because I was too busy selling it. A broker would have handled the noise andd let me focus on operations. That's a real cost.
Control is an illusion if the buyer has all the leverage. If you're desperate to sell, you don't control anything. The only control you have is the ability to say no and walk away. If you can't do that, direct selling is a trap.