The Cost of Selling a Business

Selling your business is one of the most significant financial decisions you will ever make. While every transaction is unique, most business owners encounter many of the same considerations—and are often surprised by the costs associated with preparing for and completing a successful sale.

A well-executed transaction typically involves professional services such as accounting, legal counsel, tax and estate planning, and M&A advisory. Although these costs should be carefully considered, they are often an investment in achieving a higher purchase price, more favorable transaction terms, and a smoother closing process.

Working with experienced advisors allows you to navigate the complexities of a transaction with confidence while remaining focused on leading your business. At Piedmont M&A Advisors, we guide business owners through every stage of the M&A process, helping them maximize value and achieve their personal and financial objectives.

We are responsible for:

• Assisting in setting expectations for preliminary valuation
• Marketing your company and finding potential buyers
• Managing the selling process
• Negotiating the transaction
• Overseeing due diligence
• Negotiating definitive agreements

What it Costs to Work with M&A Advisors

Every investment banking firm is different when it comes to the cost of selling a business. Each firm has specific minimum fees they collect. Additionally, fees will differ depending on the transaction type.

Unpacking the Two Main Types of Merger and Acquisition (M&A) Advisory Fees

While fee amounts may vary, there are generally two types of fees associated with working with an M&A advisor:

Retainer or Work Fee

Typically, investment bankers require a monthly retainer/ work fee for the time required for the sales process. Portions of the fee are normally credited toward the success fee upon a completed sale.

Success Fee

The success fee may be a fixed percentage of the transaction price or vary as a sales price increases. The success fee is charged once the business is sold, but the percentages are outlined from the beginning in the engagement contract. Most success fees are offset by a portion of the amount already spent on retainer costs.

It is important to consult with your investment banker, wealth manager, attorney, or CPA regarding strategies when selling your business. Piedmont M&A appreciates your relationship and brings years of experience and knowledge to ensure that we meet your expectations.

If you would like to understand the process of selling your business, please do not hesitate to contact us at 404.719.4792. We look forward to helping you achieve your M&A goals.