Selling my business. Have broker but want to deal private party.
So I signed a deal with a sales broker who has put up my business on the online listings. I found someone not through him who wants to buy the business. Will I still have to pay him a commission. Also  is there a legal template I can use to transfer the business to the private party? I wouldn't mind using him to close the deal for his expertise but don't feel like he should be entitled to the full commission as I found this buyer.
[{"id": "fcixxfj", "text": "You sure that buyer didn\u2019t come across any of your brokers marketing?\n\nHis paperwork with you will have language to protect him from you doing exactly what you are trying to do. \n\nYou should expect to pay them in full", "replies": [{"id": "fciyfj6", "text": "One hundred percent sure. I'm sure using the broker will make things a lot smoother. I was thinking of still using him but maybe asking for a rate reduction as he didn't find them. I don't want to pay him $8K for this. I am not sure how hard it is to do the paperwork for the sale. Just looking for advice I guess.", "replies": [{"id": "fcizcay", "text": "The advice I have to offer is that you\u2019re being a schmuck. Pay the broker.", "replies": [{"id": "fcizi09", "text": "OK Diarrhea.", "replies": [], "depth": 4}], "depth": 3}, {"id": "fcj82qe", "text": "Remember he likely has a 50 percent split with his firm and then has to pay taxes on whatever his net ends up being. Just something to keep in mind.", "replies": [], "depth": 3}], "depth": 2}, {"id": "fcj8lc6", "text": "Even if it's half of what I was originally asking and he keeps the full commission?", "replies": [{"id": "fcjatf5", "text": "If you didn't set it up as a percentage of the sale, that's on you.  That said I'd ask the broker politely to take a haircut.", "replies": [{"id": "fcjawkr", "text": "It was a set rate. Now I know better incase it happens again.", "replies": [], "depth": 4}], "depth": 3}, {"id": "fcjb8vc", "text": "it should be a percentage. so they would be making half the fee with half the sale price", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "fcizf9e", "text": "Read your contract. That\u2019s where you will find the answer.", "replies": [], "depth": 1}, {"id": "fcizw1b", "text": "I'm in a similar situation but I discussed this with my broker when I signed the contract. He gets 12% but if I bring him the buyer he gets 6% and we still use the broker to draw up contracts and do everything else related to the sale.", "replies": [{"id": "fcj074i", "text": "I see. I am selling the business for $35K and he get's 7K if it sells. Seems high if I brought him the customer. Plus in 1 years time I have reduced the asking price multiple times and he has only had one person see the store.", "replies": [{"id": "fcj32cr", "text": "Wtf? That commission seems crazy high.", "replies": [{"id": "fcj3bn3", "text": "Well the asking price was $70K but for a quick sale I kept lowering it but never realized that his commission fee stayed the same. I have told my landlord I am leaving in March but would rather make something than nothing. Never tried selling a business so i won't make that mistake again.", "replies": [{"id": "fcj4nxj", "text": "What was your ebitda?", "replies": [{"id": "fcj5g96", "text": "Ballpark is $160K", "replies": [{"id": "fcj7ur6", "text": "Wait, that sounds like gross revenue. Ebitda is also known as your cash flow after all expenses, but before taxes and interest payments (generally). \n\nUsually businesses sell for a multiple of their ebitda - normally 1 - 3x. So if your business cash flow was $160k, the buyer is purchasing in theory, $160k in cash for the year. So IF your buyer is getting it at $35k, that is one hell of a steal.\n\nI am going to guess that is gross revenue and your cash flow is closer to 25-45k. In which case the 70k initial asking makes sense.", "replies": [{"id": "fcj8gx8", "text": "No its $160K. I have known I had to move out of state and I priced it much lower than normal for a very quick sale. Thing is a quick sale never happened. So i tried concessions such as free rent. Nothing.  Now I'm in a spot where i have told my landlord that I was going to be out by January or February. I just happened to meet a guy who regularly shops by me and he happened to say he was looking at a low cost business to get into. I gave him the rate that has been posted and it seems like he wants to do it after checking out all my numbers. It's a personal family issue so I either sell and make something and have a new tenant in place or just hand the keys to my landlord.", "replies": [{"id": "fcjpwa7", "text": "Pm me. I'm interested in your biz.", "replies": [{"id": "fcl3bfo", "text": "&gt; I have come to terms with the buyer and the broker has decided to cut his fees by a couple of thousand.", "replies": [], "depth": 10}], "depth": 9}, {"id": "fckcl20", "text": "Please PM me your biz detail. I\u2019m interested too", "replies": [{"id": "fcl3afz", "text": "I have come to terms with the buyer and the broker has decided to cut his fees by a couple of thousand.", "replies": [], "depth": 10}], "depth": 9}, {"id": "fckj9xo", "text": "Pm me I\u2019ll pay you a lot more for the business. Don\u2019t lose out on the 35k!", "replies": [], "depth": 9}], "depth": 8}], "depth": 7}], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "fcj42w2", "text": "If its an exclusive right to sell you lose.", "replies": [{"id": "fcj5ic5", "text": "That's just it. I cannot find a copy of the agreement.", "replies": [{"id": "fcjaoa7", "text": "That's not material if the document was fully executed by both parties and the other side can provide proof of execution/delivery.  You're familiar with liens, yeah?", "replies": [{"id": "fcjatpd", "text": "Yes I am.  I'm just going to ask if he is willing to renegotiate the deal.", "replies": [{"id": "fcjb20v", "text": "I just read through the whole ordeak: the mistake isn't in the contract, or who sourced what... it's in the original deal.  That commission as a percentage IS crazy high, you clearly shouldn't have agreed to that.  Ask him to take a reduced fee, but it doesn't sound like you have too much legal ground to stand on.  Lesson learned.", "replies": [{"id": "fcjfdt9", "text": "As mentioned before. I have never sold a business. And never thought I would have lowered the price by half as it was priced pretty low. This will never happen to me again.", "replies": [], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "fcj6q43", "text": "Tell him you were doing end of year paper work and accidentally shredded it or threw it away, anyway you need a copy for your file. \n\nUsually there is a time limit and a set percentage, not a price point that goes on forever... but you need that contract.", "replies": [{"id": "fcj8rtn", "text": "Thanks for that. He already knows I am turning in my keys if it doesn't sell within 60 more days. Its stressful.", "replies": [], "depth": 2}], "depth": 1}, {"id": "fcjgl59", "text": "Did you a hire a broker to sell the business or real estate associated with the business?", "replies": [{"id": "fcjjp4p", "text": "A broker who primarily sells businesses.", "replies": [{"id": "fcjk72h", "text": "This subreddit is for real estate related items only.", "replies": [{"id": "fcjkb5d", "text": "I apologize. When I typed in the subject this was the first forum that came up.", "replies": [{"id": "fckekgi", "text": "No worries!   I just want to make sure there\u2019s context as the brokers that may respond this thread are doing so with real estate in mind.", "replies": [], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "fcjvwaa", "text": "Finding a buyer is the easy part. Closing the deal can be much, much harder and is exactly where you would need a competent broker (from your comments you don\u2019t even know which forms to use, aren\u2019t good at negotiating, and can\u2019t keep track of you paperwork). \n\nPay the broker the agreed amount and let them get it closed for you. Trying to give the broker a haircut right before you actually need their negotiating skills and experience is usually not a good plan, especially for such a small deal. You will just piss them off when you need them the most.", "replies": [], "depth": 1}, {"id": "fckjdi8", "text": "I\u2019m really lost here, everyone is giving you advice as if this is a real estate broker, but without reading all of the comments it sounds to me like you are talking about a business broker???", "replies": [{"id": "fckptx7", "text": "Yes. It's someone who works with people who want to buy or sell a business.", "replies": [{"id": "fckt0qi", "text": "I\u2019ve dealt with 3 of these people only but I thought they were all con artists in one way or another.\n\nYou are in the wrong sub though. I don\u2019t know what normal fees are for business brokers.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}]