How Much is a Business Brokers Commission?

by Vanessa Lovie 7th of March, 2025

How Much is a Business Brokers Commission?

Typically, a business brokers commission is between 5-12% of the business sale price. Though there may be additional fees, with business brokers often charging an upfront marketing fee of $4,000+

These days, a broker will normally want to earn a minimum of $20,000 sales commission, though it can be $100,000+ if selling a multi-million-dollar company. There are many factors that impact how much a business broker will charge. Undertsanding their fees and services can help you make a decision on which business broker to choose or whether to sell privately.

We take a look at what you should know when choosing a business broker and how to make comparisions to get the best outcome for your business sale.

What you'll Be Paying

1. Understand the Commission Structure

Typically, a business broker only gets paid if your business sells.

For example, on a $500,000 business sale, a 5% commission would be $25,000, while a 10% commission would be $50,000. While this might sound like a lot, a good broker will invest significant time and resources into selling your business and could help secure a higher sale price.

So, how much commission will a business broker charge? It depends.

Several factors influence broker fees, including:

The complexity of your business - does it require a niche buyer? How large is the business?
How sale ready your business is - if it's well-prepared, you may be able to negotiate a lower commission.
Market conditions - are there active buyers in your industry?
The time required to sell - brokers typically don’t want a business sitting on the market for longer than six months without serious interest.

For smaller businesses, particularly those under $300,000, commissions tend to be closer to 10%. Why?

Ironically the time it takes to sell a $160,000 cafe (Lets say 10%, or $16,000) could take just as long as it does to sell a $3 million transport company (At say 5%, $150,000). Its always about matching a buyer with a seller, and the due diligence process takes time. The broker needs to first find the buyer, then facilitate the communication between all parties, it takes time.

This is also why smaller businesses, under $300,000 may struggle to firstly find a business broker to work with, or once they find one, may not be happy with their level of service. It has alot to do with the commissions they are earning, and the amount of effort they are willing to put into the sale. Especially if they land a bigger business, with more commissions.

Sometimes, small business owners are shocked by how much a brokerage wants to charge. This can happen for a few reasons. One of the common reasons, if the broker isn’t particularly interested in taking on the listing, they might quote a high commission to discourage the client - or if the client agrees, at least the broker is well-compensated for their time. It’s the classic 80/20 rule in action, where brokers focus on the listings that will bring the highest return for their effort.

So collect multiple appraisals, and fee structures from different brokerages.

Commission Guide:

Sale Price of Business >	$100,000	$200,000	$300,000	$500,000	$1,000,000
5% Commission Rate	$5,000	$10,000	$15,000	$25,000	$50,000
7% Commission Rate	$7,000	$14,000	$21,000	$35,000	$70,000
10% Commission Rate	$10,000	$20,000	$30,000	$50,000	$100,000
12% Commission Rate	$12,000	$24,000	$36,000	$60,000	$120,000

2. Understand the Upfront Fee

We are seeing alot more business brokers charging an upfront marketing fee of $4,000+.

Is this a good or a bad thing?

The Good...

If the brokerage is committed to selling your business and has a strong reputation, this money should go towards effective marketing. It should be used to get your business in front of serious buyers - not just by listing it online but through active networking, outreach, and strategic advertising. A good broker will use these funds to attract the right buyers and guide the sale process.

The Bad...

Unfortunately, some brokers take the money and do very little. They list the business on a few business for sale websites and wait. After three months, with little interest, they may suggest lowering the price. At six months, when the agreement is nearly up, they might push for a further discount or ask for more marketing spend. This is where sellers can get stuck.

So what to do?

Ask for a clear breakdown of how your money will be spent. Unlike real estate, there are no signboards, photography, or videos required - so where is the marketing money going? A good broker should have a solid marketing strategy and a clear plan for prospecting buyers. Get these details upfront before committing.

3. The Cost of Mistakes

While this isn’t money directly out of your pocket, well it could be if you’re paying for a service that isn’t delivered.

The real risk lies in making the wrong decision or leaving your business sitting on the market too long, losing value, or being unprepared when the right buyer comes along.

You risk becoming 'burnt out' in the process, and just wanting to 'get rid of the business'.

If you want to sell your business for the best price, preparation is key.

A business broker’s job is to sell your business, but they’re not magicians. They can’t take an unprepared business and sell it for top dollar in six months. As the owner, you need to do the groundwork. Take a look at these 7 common mistakes, and try to avoid them.

How is a Business Brokers Commission Earnt?

A business broker is there to assist you from start to finish with the business sale. The broker is normally involved in the following functions:

Appraising the business to determine its market value.
Preparing detailed information memorandums for potential buyers.
Reaching out and prospecting for potential buyers.
Creating and delivering marketing strategies.
Screening prospective buyers to asses if they have the finances and are serious buyers.
Facilitating negotiations between the buyer, seller, and their advisors.
Assisting in closing the deal and ensuring a smooth transition.

We take a full look at the role of a business broker in this article.

How to Choose a Business Broker

If you have watched 'Luxe Listings Sydney' you probably have an idea of how the top end of real estate in Sydney works. You have the 'hot shots' you have the expertise to get you the best price. They 'know the market' and can 'get you the best price'.

They highlight the importance of setting a realistic price, and when young inexperienced agents enter the market and promise a client 'top dollar', it usually falls apart after a month, when the market doesnt agree. The property is then listed with the top agent and sold at the market value - rather than some over ambitious sale price.

The same applies for business sales.

There are over 600 business brokers on Bsale, in Australia there are about 800 if you include real estate agents who sell 1-2 businesses a year.

When you start getting appraisals, you will find an array of options. Often, to get your business through the door. So do your research, learn who is the best business broker for your industry or area. Collect multiple appraisals.

We wrote about this in our how to choose the best business broker guide.

Updated March 7, 2025

Originally Posted: 2019

Tags: selling a business business brokers commission