I've been browsing businesses for sale for about six months now, mostly on the big marketplaces. It seems like the majority of listings I see are months old, sometimes over a year, with no price change and no updates. Some still say 'actively seeking buyer.' What gives? Are these sellers just testing the waters, or are brokers keeping dead listings up to look busy? Curious what others have observed.
Listings
Why do so many marketplace listings go stale?
A lot of it is sellers who aren't serious. They list because they think they might want to sell, but when a real offer comes in, they get cold feet. The listing stays up because the broker doesn't want to lose the listing agreement.
I've noticed the same thing. What bugs me more is when you inquire and get no response at all. If they're not motivated enough to reply to a basic question, what else are they cutting corners on?
Honestly, some of these listings are just placeholders. The broker signs a listing agreement, throws up a basic profile, and then never updates it. It's frustrating from a buyer's perspective.
Could also be unrealistic pricing. Seller wants a number that the market won't pay, so it just sits there. Nobody wants to be the broker who tells them to drop the price by 30%.
I've seen listings that are over two years old. At that point, it's not a listing, it's a permanent fixture. I've stopped even opening ones that haven't been updated in six months.
That That's a good filter. I do the same. If there's no activity in the last quarter, I assume it's a ghost listing.
Not always the seller's fault. Sometimes the business just isn't sellable at the moment. Maybe it's a restaurant with a lease about to expire, or a retail shop in a declining area. The broker might keep it up hoping something changes, but it's basically dead on arrival.
I inquired about one listing last year and the broker told me the seller was 'testing the market' and wouldn't consider offers below a certain multiple that was way aboev industry average. Why even list it then?
Because some brokers get paid a retainer or a fee to list. It's not always about closing the deal. That's a cynical view, but I've seen it.
There's also the issue of seller fatigue. After six months of no offers, they just stop caring. The broker might keep the listing active out of habit, but the seller has mentally checked out.
I wonder how many of tHese are actually sold but never taken down. I've seen a few where I know the business changed hands, but the listing still shows up on the marketplace months later.
That happens too. Brokers are slow to update, or they just forget. It's not a good look, but it's common.
From a buyer's side, it's a huge time sink. You have to weed through, so much noise to find anything that's actually for sale by a motivated seller.
Thanks for the insights. The seller fatigue angle makes sense, but I still think there's an incentive problem on the broker side. If there's no penalty for leaving a stale listing up, why bother removing it? Anyway, I might start calling brokers directly and asking point-blank if the seller is still motivated. That might save some time.