A Q u a r t e r l y D i g i t a l P u b l i c a t i o n o f t h e I n t e r n a t i o n a l B u s i n e s s B r o k e r s A s s o c i a t i o n
T H E B E S T I N S I G H T S O N B U Y I N G A N D S E L L I N G S M A L L B U S I N E S S E S
By Erin Crawford,
2025 IBBA Chair
Expanding Value and
Advancing Growth
Plus Insights on:
+ Justifying the Price
+ Mistakes to Avoid When Selling a Small Business
+ How Early Expectations can Make
or Break Deals and More!
Fall 2025
The insights and opinions expressed herein are those of the authors and do not represent professional counsel nor an endorsement by the IBBA.
FALL 2025
The best insights
on buying and selling
small businesses
6
12
16
22
LETTER FROM THE CHAIR
JUSTIFYING THE PRICE
MISTAKES TO AVOID WHEN SELLING A SMALL BUSINESS
HOW SETTING CORRECT EXPECTATIONS FOR SELLERS AND BUYERS
FROM THE BEGINNING CAN MAKE OR BREAK DEALS
THE SHIFTING LANDSCAPE OF BUSINESS BUYERS
In this Issue
FALL 2025
Dear IBBA Members,
As we move through this quarter, I am excited to
share some of the latest developments within the
IBBA that underscore the tremendous growth
and value of your membership. Our mission has
always been to provide resources, education, and
opportunities that elevate your success as business
intermediaries, and I’m pleased to highlight two
recent enhancements that do just that.
EXPANDING MEMBER VALUE
WITH BIZPROVALUE
We are thrilled to announce that IBBA members
now receive a complimentary 1-Year Navigator
Subscription Plan from BizProValue, a benefit
valued at $600. This plan allows you to create two
CORE level project per month, with six additional
complimentary projects (3 CORE and 3 ULTIMATE)
available immediately. These tools are designed to
help you deliver deeper insights and greater value to
your clients, reinforcing your role as trusted advisors
in every transaction.
MAKING CERTIFICATION MORE ACCESSIBLE
Earning your Certified Business Intermediary
(CBI) designation has never been easier. With the
introduction of CBI Online Proctoring, candidates
ERIN CRAWFORD
CBI | 2025 IBBA Chair
Expanding Value
and Advancing Growth
Your continued participation and commitment are what
make IBBA the premier professional organization for business
brokers worldwide. With every new benefit and innovation,
we strive to empower you with the tools, education, and
community you need to thrive.
can now complete their exam online rather
than traveling to a physical testing center. This
advancement not only saves time and expense but
also reflects our commitment to removing barriers
and supporting your professional growth.
LOOKING AHEAD: LEADERSHIP AND EVENTS
We are preparing to announce the slate of candidates
for the 2026 Board of Governors election, and I
encourage you to engage in this important process
of shaping IBBA’s future leadership. In addition,
planning is already underway for the 2026 Annual
Conference in Minnesota. This promises to be
another exceptional event, bringing together the
best minds in our industry to share knowledge,
strategies, and networking opportunities.
Your continued participation and commitment
are what make IBBA the premier professional
organization for business brokers worldwide.
With every new benefit and innovation, we strive
to empower you with the tools, education, and
community you need to thrive.
Thank you for being a valued part of the IBBA family.
Best regards,
ERIN CRAWFORD | CBI, MBA
Chair of the Board of the International Business
Brokers Association (IBBA)
LETTER FROM THE CHAIR
The IBBA: Over 3,000+
Members Strong, and Climbing!
FALL 2025
Justifying the Price
JOE CAFFREY
CBI
JUSTIFYING THE PRICE
We often discuss the importance of having a
valuation done when considering selling a business.
From the amount of time a business remains on
the market to being able to justify the asking price,
without a valuation there’s no way anyone involved
has much of an idea what the business being
offered is worth– with the possible exception of the
buyer.
And when the buyer knows more than the seller
– when that buyer knows what similar businesses
have sold for or are currently available for – the
seller and their broker are at an immediate and
distinct disadvantage.
Like any new business broker, when I started
Worldwide Business Brokers back in 2001, I needed
listings. I would always value the business ahead of
time but, still, I needed listings. I might know the
value and be able to explain it to our potential client
but the client very often had a number in mind and
no plan to deviate from that number.
This need I had for listings resulted in my taking a
couple of early ones at the price the seller wanted; a
price that I knew would render the business un-
sellable. But I needed listings.
The gory details of the following two examples – my
first two listings back in the very early 2000s – are
taught in our courses and are constant topics in our
weekly support sessions. Both are true stories.
SELLING WITH THE RIGHT PRICE
The first listing I took was for a wholesale business
located on the east coast of the U.S. We valued the
business at $1.25 million.
I took that valuation – a 24-page graphic-rich opus
– to the owners, explained where we got the data
we used, the number of valuation techniques we
employed, the methodologies we utilized, the final
calculation approaches we brought to bear and
how we determined and applied specific levels of
importance to each method’s result to arrive at our
final range of likely values.
The sellers took a weekend to review the document.
When we got together the following week, they
asked a few questions about the numbers but soon
their questions were more about how we planned to
market their business; questions that were related
to process. No longer were we discussing value.
They agreed with the valuation and agreed to list
the business at that price.
I sold that business in four months – marketing,
LOI, purchase contract, due diligence, contingency
removal, financing sourcing and closing; four
months. When we showed prospective buyers how
we arrived at the business’ value, we received not
the first peep of argument. We found a buyer for the
business at full price.
FALL 2025
SELLING WITH THE WRONG PRICE
The second listing I took was for a small mobile
home business which we valued at about $750,000.
This was the first time – and there have been plenty
since – I heard the refrain, “But I need more than
that.”
The seller wanted it listed for $1 million. I could not
dissuade him. But because I needed listings, I took it
at $1 million, knowing it would not sell.
Over the first couple of months, we received several
offers, all of which were within shouting distance
of our $750,000 estimate of value. But soon, traffic
tapered off.
By month 10, we were able to get the seller to
reduce the price – but only to $900,000. This move
– significant to the seller but modest relative to the
business’ value – excited no one. Traffic remained
flat. But a couple of months later, the seller agreed
to reduce the price a second time: to $825,000
Within 30 days we had a buyer for the business
– at a price slightly above the valuation number –
and the deal closed 60 days later. It took almost 16
months to get this one done and the main reason is
that the asking price was totally unrelated to value.
Once the price was reasonably close to value, we
had a buyer pretty quickly.
WHAT THESE FIRST TWO DEALS TAUGHT ME
During the long slog to get that second listing
sold, I discovered something that has been proven
true repeatedly over the past 25 years. It’s not that
the price has to reflect the value – although that’s
certainly true. The lesson was this:
Buyers don’t come back as the price drops
gradually to something close to market value.
They’ve moved on. Sure, we reached out to everyone
who had expressed interest in this business but the
reception we received was lukewarm at best.
Some of those potential buyers had found other
businesses to buy; businesses whose sellers
understood that the price has to reflect the value.
Others knew that a business that had been on the
market for more than a year probably had suffered
some reputational damage, a condition few buyers
want to tackle.
THE BOTTOM LINE
When selling a business, we’ve never had anyone
– buyer, seller, lender, baker, candlestick maker or
Indian chief – challenge our valuations.
We’ve had seller’s say, “I need more than that” and
we’ve had buyers say, “I’m not going to pay that
much”. But no one has ever said that our methods,
calculations or conclusions were wrong. We
provide too much data in such a clear and easily-
comprehended manner that, when logic is applied, our
conclusions are confirmed. This is what I mean when
I advise our new brokers that they have to be able to
justify the price of any business they bring to market.
When bringing a business to market, the price asked
(if one is asked – as opposed to asking for bids) must
be justifiable – that is, it must be related to the
business’ value. A savvy buyer or their broker will
ask, “How was the price arrived at?” If that question
can’t be answered clearly and backed up with data,
the chances of a successful sale are reduced.
JOE CAFFREY | CBI
jcaffrey@WorldwideBusinessBrokers.com
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FALL 2025
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October 1-3 | December 10-12
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Learn How to Properly Price a Business & Close More Deals
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11
Market Pulse Q2 2025 Highlights now available
Learn more and participate in our next survey to
gain access to exclusive participant benefits.
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ADVISORS REPORTING MINIMAL TARIFF IMPACT ON CLIENTS
68%
90%
Seller’s Market Sentiment Q2 2012-2025
SELLER’S MARKET CONFIDENCE
Q2 2025 Highlights
‹$500K
$500K-$1M
$1M-$2M
$2M-$5M
$5M-$50M
MARKET SEGMENTS STUDIED
MAIN STREET
LOWER MIDDLE MARKET
20
40
60
80
82%
76%
MAIN STREET
LOWER MIDDLE MARKET
Percent reporting minimal impact (0-20%)
"Tariffs are certainly something buyers and sellers are aware
of, but they’re not driving the decision to go to market for
most business owners. Unless a company has significant
exposure to China trade or imported goods, we’re not
seeing tariffs delay deals in any meaningful way."
- Scott Mashuda, Managing Director of REAG
FALL 2025
RAAVI SRAVEN,
CBI
Mistakes to Avoid When Selling
a Small Business
13
Most successful business owners plan, strategies
and work very hard over the years to build a
successful business but when it’s time to sell,
business owners make drastic mistakes resulting
in selling the company for a lower value (If the
business sells), stress, and all the hard work going
down the drain, it is basically like growing a tree
for many years but not be able to enjoy the fruits
of your labor. These mistakes are often easily
avoidable.
According to the data from BizBuySell and other
industry sources, it usually takes at least six to
eleven months to sell a business, and it is mostly
true in our experience of selling businesses, so this
article is about business owners who want help in
understanding the mistakes that avoidable and
make the process of business sale as smooth as
possible. Let’s look at the ten common mistakes to
avoid when you have decided to sell your business.
MISTAKE 1 # Not reaching out to the right
professional in the early stages of planning &
trying to sell your own business
In our opinion, if this first mistake can be avoided,
most of the other mistakes are very unlikely to
happen. Finding the right business brokers and
assembling a good transaction team with the help
of a business broker is crucial to your success.
Planning the sale with your team way ahead of
time (Depending on the type of business) puts you
and your business in the driver’s seat, especially
when you are going through this process for the
first time. Serious buyers are looking at many
businesses, and when you do not stand out, they
move on to the next business very quickly.
A good transaction team consists of a certified
business broker, financial team (accountant/
bookkeeper), Legal team (transaction attorney),
Tax Professional, etc. Speak to each professional
and make sure they have substantial experience in
selling businesses, and let your broker handle the
process and coordinate the entire sale process while
receiving constant updates.
MISTAKE 2 # Misrepresentation of business facts
to potential buyers in an attempt to sell quickly
As a business owner, it is your responsibility not
to misrepresent any facts to potential buyers. As
discussed above, the process of a sale is lengthy, and
if buyers find out any misrepresented facts during
the due diligence, they will back out immediately
and will have to start the process of finding the
buyer again, losing valuable time, hence hindering
the sales process. If the business sale goes through
and later the misrepresented facts are uncovered,
a legal proceeding can be very costly. Avoid the
temptation to exaggerate numbers for a quick sale,
do not hide any previous or ongoing litigations or
legal investigations, and disclose any unpaid taxes
or bills. Talk to your attorney and broker about
everything before passing the information to the
buyer and avoid any potential red flags that can kill
a deal.
FALL 2025
MISTAKE 3 # Having an unrealistic asking price
Pricing is the single most important factor that
determines how long a business stays on the
market, regardless of how good the business is.
Asking a premium for a well-organized(structured)
and good cash flow business is acceptable, but
asking an unrealistic value will mean buyers will
walk away. When a business is on the market for
a long time, it attracts the wrong buyers who are
looking for a bargain, which is exactly the opposite
of what you planned for when you listed the
business for a premium.
Many inexperienced sellers will value their business
based on their investment money and time, or
sometimes calculate the amount based on how
much they need to retire. None of these factors
determines the value of the business. The value
of the business is determined by many factors, to
name a few: current cash flow, seller discretionary
earnings (SDE), Future project earnings, Growth
potential, Desirability of a business(Trend), and
most importantly, market value of the business,
which is how much a similar business sold for. A
qualified business broker or a certified business
appraiser is key in valuing a business correctly, and
the main goal in valuing a business correctly is to
prepare backup material to defend the value of your
business.
MISTAKE 4 # Business not structured for a sale,
and the seller being an irreplaceable employee in
the company
This is mostly true for a small business. It is very
important to build and have a certain leadership
team that handles every aspect of the business,
making the business self-reliant like a well-oiled
machine, which keeps on running without a
snag. If the business owner is a key employee in a
business organization like leading sales driver/head
of operations/head of marketing ect.. and you have
decided to sell the business in the next year or two,
develop or train a employee in that role which will
be one of the biggest selling points of the business
and lay a foundation for smooth transition when
you sell the company.
Many inexperienced sellers
will value their business
based on their investment
money and time, or
sometimes calculate the
amount based on how much
they need to retire. None of
these factors determines the
value of the business.
15
MISTAKE 5 # Failing to get organized for a sale
ahead of time and not operating the business
properly during the sale process
These two factors are interlinked, and as discussed
above, this is very avoidable if a qualified business
broker guides you well in the initial stages of
planning. Due diligence period of sale can be very
exhausting; the buyer and their team will require
you to provide many reports related to finances,
customers, marketing, sales, vendors, employees,
etc.
So, keeping updated records, organizing books
and records by separating personal and business
expenses, resolving pending and threating
litigations, tax issues, EPA compliances, licenses,
leases, staffing issues ect will tremendously help
you when the business is listed for sale because the
main goal for the owner during the sale process
is to run the business successfully and increase
the sales of the business and not to run around
organizing or resolve things which can affect the
business. It is not possible to fix everything at once,
and when you are organized, you will have plenty
of time to address any unexpected issues that need
to be addressed.
MISTAKE 6 # Not maintaining confidentiality
during the sale process
Confidentiality is a critical aspect in understanding
why it is not advisable for the owner to sell their
own business. Just imagine how hard it is for
a seller to talk with potential buyers without
revealing their own business/identity and take
phone calls during business hours. If the word
gets out that the business is on the market for
sale, employees may leave, in some cases, vendors
can hold back on deals, customers may leave,
and competitors will have other ideas; all these
can lead to disruption of normal processes,
potentially affecting sales. A good broker will
know how to market the business and maintain
strict confidentiality. Prequalifying the buyer is
very important, as you want to keep tire kickers
out of the picture and not disclose any sensitive
confidential financial information.
MISTAKE 7 # Not discussing transition, leases,
and other terms clearly till the last moment
Do not leave any unaddressed issues till the last
moment after all the effort and hard work you put
into the sale process, like discussing the transition
process ahead of time, talking to landlords at the
last moment can be deal killer if they substantially
increase the rent amount, employment contracts,
and issues with transfer of licenses or patents ect.
Selling a business is rarely easy. Selling your
business can be tricky. But if you follow our advice
and tips above for selling your business and avoid
these 7 mistakes, a lot of this frustration can be
reduced, and you will be able to make a sale happen
for the right price & terms.
RAAVI SRAVEN | CBI
raavi@urbanbusinessbrokers.com
FALL 2025
How Setting Correct Expectations for Sellers and
Buyers from the Beginning Can Make or Break Deals
SARA VAZIRI
CBI
17
In the fast-paced and often emotionally charged
world of business sales, setting clear expectations
from the very beginning of the process can make
or break a deal. Business brokers are not merely
intermediaries—they are educators, advisors,
and trusted guides. The moment a broker engages
with a seller or buyer, the tone for the entire
transaction is set. How effectively the broker
educates each party and aligns their expectations
will significantly influence the outcome.
This article outlines the most common pitfalls
when expectations are misaligned and explores
how brokers can structure their initial engagement
with sellers and buyers for smoother, faster, and
more successful transactions.
THE CRITICAL FIRST MEETINGS:
SETTING THE TONE
For many business owners, the decision to sell
is monumental. Often, they speak to only one or
two brokers before making a choice. These initial
meetings are more than just introductions—they’re
an opportunity to educate the seller about the
sales process, valuation methodology, timeline,
confidentiality measures, and buyer expectations.
Unfortunately, some brokers make the mistake
of prioritizing getting the listing agreement over
education. This short-sighted approach often leads
to frustration, price adjustments, or withdrawn
listings down the road. When sellers are fully
informed about what’s included in the price, how
long the process might take, and what buyers
typically ask during due diligence, they are more
likely to stay committed and cooperative.
OVERPROMISING: A DEAL KILLER IN DISGUISE
A common pitfall in business brokerage is
overpromising. Some brokers agree to inflated
listing prices to win the engagement, assuming they
can convince the seller to lower the price later. This
approach often backfires.
For example, one seller insisted on listing their
business at double its market value. The broker
reluctantly agreed, and after a year on the market
with no serious offers, the seller’s confidence—and
the business’s perceived value—had both eroded.
When the business eventually sold years later, it
was for significantly less than it might have fetched
if priced right the first time.
Overpricing doesn’t just delay deals—it can anchor
sellers to unrealistic numbers and damage the
broker’s credibility with buyers. Trust is hard
to build and easy to lose. Brokers should rely on
valuation data and market comps, even if it means
losing a listing. In the long run, honesty earns more
referrals than wishful thinking.
EDUCATING SELLERS
ON WHAT THE PRICE INCLUDES
Another point of confusion is what’s included in
the sale price. Sellers often assume the price they
receive is net of inventory or equipment, when in
reality, most buyers expect a “turnkey” purchase
FALL 2025
that includes all assets necessary to run the
business.
This misunderstanding can create serious issues
late in the deal. A seller who expects additional
compensation for inventory or machineries may
feel short‑changed during negotiations or become
difficult during closing.
Brokers must explain early—and document
clearly—that the price includes working capital
and all the assets necessary for the business
to continue operating smoothly. This includes
certain inventory levels, equipment, customer lists,
vendor relationships, and other operating assets.
If exceptions apply, those should be disclosed
upfront and factored into the asking price or terms.
I personally tell my prospects their business is like
a money-making machine. Anything that helps
this machine work is included in the price. If you
remove the equipment, will it continue working?
If you don’t have inventory, will it work? When we
do valuation, we use the total money this machine
makes to determine value, and that’s why all the
parts of the machine that work together to generate
that income are included in the sale.
BUYERS NEED CLARITY TOO
While brokers often focus on managing seller
expectations, buyer expectations are just as
important. Buyers—especially first‑time or
SBA‑financed buyers—need a high degree of
transparency to move forward with confidence.
They typically want to know:
• Exactly what assets are included
• How discretionary earnings were calculated
• What level of owner support will be available
post‑sale
• Whether employees will remain after closing
• If customer/vendor relationships will transfer
smoothly
Confidential Information Memoranda (CIMs)
or Confidential Business Reviews (CBRs) should
address these points clearly. Ambiguity invites
doubt, which leads to delays—or worse, deal
termination. Experienced brokers understand that
informed buyers are more likely to make offers,
conduct efficient due diligence, and close with
fewer surprises.
Selling a business is not a
purely financial transaction.
It’s an emotional process.
Many sellers built their
business over decades and
view it as part of their
identity.
19
NAVIGATING THE SELLER’S
EMOTIONAL JOURNEY
Selling a business is not a purely financial
transaction. It’s an emotional process. Many sellers
built their business over decades and view it as part
of their identity. They may also be approaching
retirement, facing burnout, or managing a family
transition.
Brokers must be empathetic yet firm. Helping a
seller understand that the market determines
value—not emotions or sunk costs—is an essential
step in aligning expectations.
When sellers are guided gently through the
valuation process and understand how buyers view
risk, they are more open to compromise. A seller
who receives early education is less likely to pull
out during negotiations due to disappointment or
distrust.
MANAGING TERMS, NOT JUST PRICE
Misaligned expectations aren’t always about price.
Deal terms such as seller financing, training periods,
and working capital adjustments often derail deals.
Common gaps include:
• Sellers assuming they can walk away
immediately after closing
• Buyers expecting a three‑month transition and
training period
• Sellers wanting full payment at closing while
buyers need seller carry
• Disagreements over working‑capital
adjustments
The best brokers address these points upfront.
During the listing and buyer introduction phases,
they clarify what support the seller is willing to
provide and what deal structures are feasible. This
avoids re‑negotiation after the LOI stage, where
emotions run higher and trust can be fragile.
BUILDING A REPUTATION
THROUGH CONSISTENCY
Setting clear expectations is not merely a tactical
move—it’s a long‑term brand strategy. Brokers
who consistently educate their clients and avoid
overpromising earn trust in the market. Buyers
know their listings are well‑researched, sellers
refer other business owners, and deal professionals
respect their professionalism.
A REAL‑WORLD CAUTIONARY TALE
A manufacturing business in Southern California
was listed by a broker who agreed to a seller’s
inflated price. The business had low margins, high
customer concentration, and was heavily dependent
on the owner—but the broker feared losing the
listing if they pushed back.
For two years, the business sat on the market.
Qualified buyers passed. Eventually, the seller’s
motivation declined, key staff left, and profitability
dropped. When it finally sold, it was for less than
60% of the original asking price.
FALL 2025
Had expectations been managed early—with
a realistic valuation and a clear roadmap—the
business could have sold quickly and at a better
price. Instead, time and value were both lost.
FINAL THOUGHTS: EXPECTATION
MANAGEMENT IS RISK MANAGEMENT
In the end, business brokers are in the business of
managing risk—both real and perceived. Setting
correct expectations with sellers and buyers isn’t just
a courtesy—it’s a form of risk mitigation. It reduces
deal fallout, builds credibility, fosters cooperation, and
protects everyone’s time and resources.
So the next time you sit down with a new client,
ask yourself: Have I told them what they want to
hear—or what they need to know?
SARA VAZIRI | MBA, MSC, CBB, CBI
sara.vaziri@zbbcorp.com