One of the most common questions we’re asked by potential franchisees is what they’ll need to do about licensing – in other words, how to get your business broker license.
In short, the answer is pretty simple: You don’t.
There isn’t actually such a thing as a “broker license.” But there are, however, different ways to make yourself stand out from the field, including certifications that are as close to “licensure” as it gets.
Here’s a look at what you need.
A Real Estate License
Not every state requires you to have a real estate license, but several of them do, and a few more have explored laws to require it before. The laws and regulations can (and sometimes do) change very quickly, though, so it’s important to research the requirements in your individual state.
Additionally, if the business you’re selling involves the transfer of a physical property, you’ll need a real estate license regardless, so it’s a prudent decision to take the course and get your license.
While there is no actual license, there are several brokerage organizations that educated and experienced business brokers can join in order to increase their reputability. By earning these certifications, a broker aids their credibility in the eyes of prospective clients.
To become certified, brokers typically need to apply and pay a fee. The most notable organizations and their certifications include the International Business Brokers Association (IBBA), which offers the Certified Business Intermediary (CBI) designation, and the American Business Brokers Association, which bestows the Accredited Business Intermediary (ABI) designation to qualified brokers.
Other states also have state-specific organizations that offer credentials of their own.
It’s not uncommon for business brokers to work from home. In fact, it’s a widely accepted practice, and one that’s rapidly growing – nearly 40 percent of business brokers work away from traditional offices.
But while it might be easy to call clients and negotiate business deals from the couch in your pajamas, it’s not practical for serious business brokers that hope to be successful.
At the very least, it’s important to have a professional space to meet prospective clients in, and even to have a buyer and seller in the same room to meet, negotiate, and sign paperwork. And while doing that from a home office might be okay with an established customer with whom you’ve developed rapport, doing so with a new client can be an awkward and uncomfortable experience.
For more information on franchising with Transworld Business Advisors, contact us today.