A discussion on the benefits, challenges, and best practices of co-brokering in the business brokerage industry.

In the dynamic world of business brokerage, few topics generate as much debate and controversy as co-brokering. Co-brokering, the practice of collaborating with other brokers to facilitate business sales, has been a subject of keen interest for James E. Parker, a renowned figure in the field. In a recent webinar titled “Let’s Rumble… Talking About Co-Brokering Business Sales,” Parker brought together a panel of experts to delve into this contentious topic. In this article, we summarize the key insights shared by the panelists: Roberta Caputo, Treve Kinsey, and Joe Santora.

Meet Our Experts Panelists:

Roberta Caputo

• Founder and managing director of Capital Business Solutions, an international firm specializing in mainstream mergers and acquisitions.
• Material expert and best-selling author on business brokers
• A 16-time winner of Florida’s “Million-Dollar-Plus” Award
• 2019 Chairman’s Award recipient which is one of the state’s highest honors: recognizing outstanding work and dedication to the industry.

Treve Kinsey

• Vice President of sales for Transworld for the last 11 years.
• He oversees 80 brokers and over 1100 listings.
• Treve’s team of brokers have over 350 closings per year, 35% of which are co-brokered.

Joe Santora

• Joe, also with Transworld, is a member of the Carolinas-Virginia Business BrokerAssociation [CVBBA].
• He has been instrumental in bringing co-brokering to the CVBBA over the last few years.

Benefits of Co-Brokering:

• Increased inventory: Co-brokering allows brokers to tap into a larger pool of available businesses for their clients, leading to enhanced service capabilities.
• Financial gains: Co-brokering has proven to be financially rewarding, providing additional revenue streams for brokers and agencies.
• Greater exposure: Collaborating with other brokers increases the visibility of business listings, attracting more potential buyers.
• Retention of buyers: With buyers often venturing beyond their original preferences, co-brokering ensures brokers can present alternative opportunities, thus retaining potential buyers.

Challenges and Implementation:

• Resistance to change: Some brokers may resist co-brokering due to unfamiliarity or concerns about losing control over the listing. Education and gradual implementation can help address these concerns.
• Regional association involvement: Regional associations play a crucial role in implementing co-brokering practices and establishing standards for qualified brokers to participate.
• Establishing ground rules: Open communication, clearly defined roles, and professional and ethical conduct are essential in ensuring a smooth co-brokering experience. Listing agents should maintain control and act as the primary point of contact for sellers.

Moving Forward:

• MLS development: Associations are exploring the establishment of MLS (Multiple Listing Service) platforms to facilitate co-brokering and enhance collaboration among brokers.
• Educational initiatives: Educating brokers, buyers, and sellers about the benefits of co-brokering and setting expectations for all parties involved are crucial for successful implementation.
• Learning from successful models: Associations can seek guidance from established organizations like the Business Brokers of Florida (BBF) to develop effective co-brokering guidelines and minimum standards for membership.

Conclusion:

Co-brokering presents significant opportunities for business brokers, allowing them to expand their inventory, increase revenue, and provide enhanced services to clients. While challenges exist, such as resistance to change and maintaining control over listings, the consensus among experts is that co-brokering is a valuable practice for the business brokerage industry

 

The information contained in this blog first appeared as part of our webinar Let’s Rumble… Talking About Co-Brokering Business Sales. Head over to our YouTube channel to learn more from co-
brokering experts Roberta Caputo, Treve Kinsey, and Joe Santora—not to mention BGI’s very own James Parker.