Questions to Ask a Business Broker Before
Hiring Them to Sell Your Business

  1. How many years has your firm been in business?
  2. Are you a member of the California Association of Business Brokers (CABB)?
  3. Are you a member of the International Association of Business Brokers (IBBA)?
  4. Are you a member of M&A Source?
  5. Does your firm solicit international buyers?
  6. Where do you advertise your business listings?
  7. What is. your valuation process?
  8. How do you screen potential buyers?
  9. How do you maintain strict confidentiality?
  10. Who writes the articles on your website?
  11. Does your firm request any advance fees?
  12. Can you help us renegotiate the terms of our premises lease?
  13. Who will prepare the sale-purchase contract when I sell my business, and will I need an attorney?


Our Answers -

  1. Our firm was founded in 1987. We have been providing business buyers, sellers, and merger clients with services for over 35 years.
  2. Absolutely. We are corporate members of CABB and we strictly adhere to their code of ethics.
  3. Absolutely. We are corporate members of IBBA and we strictly adhere to their code of ethics.
  4. Absolutely. We are corporate members of M&A Source and we strictly adhere to their code of ethics.
  5. Yes. We have a Director of Marketing - China who was born in Wenzhou, China. She speaks English, Mandarin Chinese, and Wenzhounese. We also have a Director of Marketing - Taiwan who was born in Taiwan. She speaks English, Taiwanese, and Mandarin Chinese.
  6. Other than pocket listings, we advertise on,,, CABB, IBBA, LoopNet, our own website, and other listing sites we believe will be valuable in marketing a particular listing.
  7. Our valuation process starts with a calculation of Sellers Discretionary Earnings (SDE), sometimes referred to as Sellers Discretionary Income (SOl), or EBITDA which is Earnings Before Interest, Taxes, Depreciation, and Amortization, whichever is applicable. We then apply a multiplier to the income. The multiplier is based on actual industry sales that have recently taken place, and then adjustments may be made based upon our best collective judgment. See: Receive a Free Broker Opinion of Value.
  8. How do the business brokers at Pacific Business Advisors screen potential buyers?

Screening buyers requires several steps. Before a prospective buyer is asked to sign a Non-disclosure Agreement (NDA) and provided any confidential information about a business, we want to determine the following: (1) Does the person have the financial ability to buy the business and have adequate reserves, (2) Does the person have a genuine interest in owning and operating the specific type of business; and (3) Does the person have the ability to run the business. We do not want to start the buying process with someone who will change his or her mind prior to closing, or who will be unable to successfully run the business after the closing. This is vitally important if seller financing is involved.

  1. Given that confidentiality is critical to business sellers, we have provided our Non-Disclosure Agreement or NDA on our website for your review. Sometimes a Non-Disclosure Agreement is referred to as a Confidentiality Agreement. While professional business brokers and investment bankers make it a practice to maintain confidentiality, we insist that all potential buyers sign an attorney drafted NDA because it is critically important that no unauthorized person finds out that a business is for sale until the transaction has closed and the seller is ready to make an announcement.
  2. All of the articles on our website were written by Michael Chulak, the founder of Pacific Business Advisors. They were not provided by a third-party service.
  3. Our firm never requests an advance fee. We are paid after we perform.
  4. Absolutely. has a sister company,, which represents commercial tenants exclusively.
  5. As a corporate member of the California Association of Business Brokers (CABB), we are entitled to use their attorney prepared forms and contracts, including their sale-purchase agreement. Notwithstanding, our firm recommends that buyers and sellers consult with their own attorney and CPA or Enrolled Agent before entering into a contract to buy or sell a business.
Office: 818-991-5200
Direct: 818-991-9019