How Much Do Business Brokers Charge in Texas?

Start With What You Keep

Owners often fixate on the commission. A better question is how much lands in your account after the sale. The fee matters, but so do price, terms, taxes and the other professionals you hire.

A broker who costs a point more and brings two serious buyers can leave you far ahead of a cheaper one who brings none. So read the fee alongside everything else on the closing statement.

Still, you should know what is normal. Here is how brokers working with Texas sellers usually get paid.

The Success Fee

Most brokers earn a success fee. It is a share of the sale price, owed only if the deal closes, and it is paid from the proceeds at the closing table. No sale usually means no success fee.

BizQuest reports that brokers commonly charge 8% to 15% on businesses that sell for $1 million or less, with 10% the most common rate. Rates tend to fall as deals get bigger.

Fees are negotiated. The rate is whatever you and the firm agree to in writing, which is why it pays to talk with more than one firm before you sign anything.

Minimum Fees

Many firms set a floor. According to BizQuest, minimums often run from $10,000 to $25,000. The broker gets the greater of the minimum or the percentage.

For owners doing $1 million or more in revenue, the minimum rarely decides the fee. It mostly bites on small sales. Check it anyway, in case the final price comes in lower than you hope.

Tiered Fees on Larger Companies

Once a sale price moves past a million or two, many firms switch to tiers. One rate applies to the first part of the price, a lower rate to the next part, and so on.

Here is a simple made up example to show the math, not a quote from any firm. Say the agreement charges 10% on the first $1 million and 6% on everything above it.

On a $3 million sale, that is $100,000 on the first million plus $120,000 on the next two, for $220,000 in total. The blended rate works out to a bit over 7%.

Ask every firm you interview to run its own formula at the same three prices. A table of dollar amounts side by side is the fastest way to compare offers that are worded differently.

Upfront Charges

Some firms ask for money before the business goes to market. It might be a flat engagement fee, a monthly retainer or a charge for a formal valuation.

Firms that handle bigger companies often charge something up front, because the prep work is heavy. Building a CIM, cleaning up financials and screening buyers all take time.

Two questions settle most of the worry. What exactly does the fee pay for, and is it credited against the success fee at closing? Get both answers written into the agreement.

Be wary of a large upfront payment paired with a sky high asking price. That pairing can mean the firm earns most of its money whether your company sells or not.

How the Fee Works on Notes and Earnouts

Few sales of established companies are all cash at closing. Part of the price often comes as a seller note paid over several years, or an earnout tied to future results.

Your agreement should say whether the broker is paid on those amounts at closing or as you receive them. Being paid on money you never collect is a real risk if an earnout misses its targets.

Many sellers push to pay the fee on deferred amounts only as the cash arrives. It is a fair request, and a broker who believes in the deal will usually discuss it.

Contract Terms That Cost More Than the Rate

The percentage gets the attention, but a few clauses in the listing agreement can matter just as much. Read these closely before you sign:

• Length of the agreement and how either side can end it
• Exclusivity, and whether a buyer you find yourself still triggers a fee
• The tail period, which can earn the broker a fee on a sale after the contract ends
• What counts as the price: cash only, or also assumed debt, notes and real estate
• Whether the fee applies if you sell only part of the company or bring in a partner

A tail clause is normal. It stops a buyer from waiting out the contract to dodge the fee. Just make sure it covers only buyers the broker actually introduced, and for a reasonable time.

The Other Costs of Selling

The broker is one of several people you will pay. Budget for a deal attorney to draft or review the asset purchase agreement, and a CPA to plan the tax side before you accept an offer.

Texas has no state personal income tax, which helps. Federal tax on the gain still applies, and the split between asset and stock sale can change what you owe by a wide margin.

There is also a Texas step on state taxes. Buyers often ask the seller to obtain a certificate from the Comptroller before closing. Our guide to the Texas certificate of no tax due covers it.

Is the Fee Worth It?

For a company doing seven figures a year, the honest answer is usually yes, if the broker does the job. The value comes from a fair price, more than one buyer and a deal that actually closes.

Deals fall apart for ordinary reasons: a lender gets cold feet, diligence turns up a surprise or a landlord won't consent to the lease assignment. A good broker sees those coming and keeps things moving.

If you are weighing whether to hire anyone at all, our page on using a broker vs. selling yourself compares the two paths plainly.

Getting Started

A fee only means something once you know what your company might sell for. Request a free, confidential valuation, or call (817) 555-0142.

We connect Fort Worth area owners with an experienced brokerage partner. Ask about fees on that first call, before you commit to anything.