What does a business broker do?

What is a business broker?

A business broker is an intermediary who represents the owner of a private company in its sale, the way a real estate agent represents the seller of a building, except that the thing being sold is a going concern with customers, employees, equipment, a lease and three years of tax returns. The broker's job is to turn that company into something a stranger will pay for, find the stranger, and get the deal to the closing table without the business losing value along the way.

The trade divides roughly by size. Business brokers work the Main Street and lower middle market, companies worth up to about $2 million, where the buyer is usually an individual with an SBA loan. Above that, the same work is done by M&A advisors and investment bankers, who run a curated process for strategic and private-equity buyers and charge a retainer plus a sliding fee. The line is blurry and the title is not protected in most states; the difference is spelled out in business broker vs. M&A advisor. Illinois is one of the few states that regulates the work itself, under the Business Brokers Act of 1995, administered by the Secretary of State, which is why a registration line sits at the bottom of every page on this site.

What a broker is not: a lawyer, an accountant, a lender or an appraiser. A good one works alongside all four and knows what each will ask for. A CPA-led firm, which is what Lakeshore is, does the accountant's part of the job in-house, and that changes the order of the work, which is covered below.

What does a business broker do, step by step?

Seven jobs, in the order they happen on a sale. The fee is earned only if all seven get done; the first one is where most of the price is won or lost.

Start to finish, that calendar runs six to ten months for a company under $2 million in value and about a year above it, according to the IBBA and M&A Source Market Pulse survey for the second quarter of 2026; the Chicago-metro median listing in 2025 spent 179 days on the market (BizBuySell). The month-by-month version is in how long it takes to sell a business, and the papers each stage needs are in the documents needed to sell a business.

How does a business broker get paid?

By a success fee, charged as a percentage of the sale price and paid at closing out of the proceeds. In Chicago and across Illinois the usual range is 8 to 12 percent, and 10 percent is the number you will hear most. Under about $1 million many brokers also set a minimum fee of $10,000 to $25,000; above about $2 million the fee usually slides, so a Double Lehman scale nets 6 to 9 percent on a $3 million sale. Some firms add an upfront retainer or a marketing fee; most Main Street brokers do not. Lakeshore charges 10 percent at any size, agreed in writing before the business goes to market, with no retainer. The structures, the clauses that cost owners money and the fee worked out at each sale price are in business broker fees in Chicago.

What that comes to per deal depends entirely on the price. On the median Chicago-metro sale of 2025, $265,590 (BizBuySell), a 10 percent fee is about $26,600, which is why the minimum exists. On a $1.5 million machine shop it is $150,000, and the broker has usually spent six to nine months earning it. Because the fee is paid only at closing, a broker who lists twenty businesses and closes eight is paid on eight; the economics push brokers toward companies that will actually sell, which is worth knowing when one tells you yours will.

Do business brokers work for buyers?

Usually not. A listing broker is engaged by the seller, paid by the seller and owes the seller the duty of getting the best price and terms. The broker will be courteous and useful to a buyer, will send the financials after the NDA and will walk a buyer through the SBA process, but the buyer should read everything the way a buyer's accountant would, because that is the only person in the room working for them. Buy-side engagements exist, where a buyer retains a broker to find and approach companies that are not listed, and they are paid by the buyer, often as a retainer plus a fee at closing. Dual agency, where one broker represents both sides, is legal in most places and is the arrangement to be most careful about. Lakeshore represents sellers; when we buy a business ourselves we say so in writing up front and take no fee.

What does a business broker not do?

A broker does not set the price. The buyer's accountant and the buyer's lender set the price, and the broker's job is to put a defended number in front of them before they can set a lower one. A broker does not draft the purchase agreement; that is the attorneys' work, and the SBA's own guide to selling a business tells owners to have one review it. A broker does not give tax advice, though a CPA-led one will tell you what the allocation on IRS Form 8594 does to the proceeds before you agree to it. A broker does not finance the deal, though the good ones know which SBA lenders close and which do not. And a broker does not run your company for the six to nine months it is on the market. In our experience that last point is where unrepresented sales come apart: the owner spends the year selling instead of operating, revenue slips, and the price moves at closing.

A broker also cannot make a company worth more than its books say. Where a buyer's accountant finds cash-basis books with no monthly close, one customer over about 20 percent of revenue, or a business that cannot run without the owner, the broker can price around the problem or help fix it, but cannot make it disappear. Fixing those items before the listing, rather than explaining them during diligence, is the whole of preparing a business for sale.

What does a CPA-led business broker do differently?

The order of the work. A conventional brokerage starts with the listing and lets the buyer's accountant find the problems. A CPA-led one starts with the audit, before there is a buyer: the earnings are rebuilt from the tax return line by line, the add-backs are tested against what a lender will accept, the working-capital target is set, and the deal file is assembled before the first NDA goes out. Lakeshore does that first step as a free confidential value range (revenue, industry and an email; two business days) and, where the fixes are structural, as a two-week Exit-Readiness Review for $4,500, credited against the success fee if we later list the business. The marketing, screening, negotiation and closing that follow are the same seven jobs in the table above. What changes is that the buyer's accountant finds the deal file already waiting, and the 60 to 90 days from the letter of intent to closing are spent closing.

Do I need a business broker to sell my business?

Not always. Hire one when buyers have to be found, the sale has to stay quiet and the company is worth more than about $1 million. Sell without one when the buyer is already known, the sale is to an employee or family, or a 10 percent fee outweighs what the broker would add. The five-question test, the break-even arithmetic and how to vet a Chicago broker before you sign are in should I hire a business broker. If you want to know what the business would bring either way, the value range costs nothing and commits you to nothing.