So, you’re thinking of selling a billboard or your billboard company?
On the surface, it may seem like a cut and dry transaction.
What’s so hard about contacting a few competitors and striking a deal? Do you really need a billboard broker?
If you’re asking yourself these questions, you are not alone! Here are a few things you should consider when it comes to whether or not your need a billboard broker:
As a seller, your number one objective should be to have an advisor with a full database of qualified buyer — and the transaction experience to match your assets with the right buyer. In many businesses it’s all about who you know, and the billboard industry is no different. It’s important for your broker to align billboard company owners with the best-equipped buyer for each unique acquisition.
Like all real estate transactions, your broker should thoroughly understand the geographical landscape and the local market. After all, you are paying for their expertise! And while you may think you don’t need a broker when you’re selling in your own backyard, that isn’t necessarily true. In many transactions, the buyers end up being new to the area or a relative unknown in the market. Additionally, a broker will have connections at the corporate level in many larger companies that could outweigh what you can find on your own.
When you’re looking to buy a billboard company, the same principle exists. You need someone on your side who knows the ins and outs of this niche business to negotiate on your behalf and find the best assets for you.
Pro: Brokers Are Experts at Setting Property Expectations on the Front End of the Deal
Due to years of transaction experience, a billboard broker will have knowledge of comparable sales to best help set proper expectations for both yourself as the seller and all prospective buyers.
Pro: The Perception – and Reality – of a Brokered Opportunity
A broker with a successful track record will often do their own due diligence on the assets before representing them, which helps legitimize all opportunities to prospective buyers.
While business is often focused on who you know, it’s also centered on the perception of reputation. If a professional firm is representing your interests, prospective buyers realize the legitimacy of the opportunity and that their competitors down the street are reviewing it, too. This way, you can command a higher price and buyers won’t tend to “lowball” their initial offers.
Pro: Brokers Overcome Obstacles
You need a broker who is detailed-oriented and knows the business. This isn’t a passive transaction. A lot of deals get derailed after a buyer is found because something comes up during the due diligence. Not only does a broker act as an intermediary to help buffer the high emotions from buyers and sellers, but they know how to overcome barriers and effectively handle hurdles that pop up — or as we like to call it, “getting scrappy!”
OK, we’ve covered a lot of pros, but that’s because we believe there are more pros than cons when it comes to using a billboard broker in your sale! However, the two largest cons that tend to sway people to try to sell their assets on their own include:
Con: Giving Up Control
When using a broker, you will have to give up some control and be OK with someone else driving the process. The right broker will have your best interest at heart, and that’s an important point to keep in mind through what could be a high-stress transaction.
However, if you’re too busy with other interests, investments or development projects, having a broker take control and take the deal off your already-full plate may be seen as a hidden blessing!
Con: Commissions for Brokered Deals
In today’s environment, you can expect to pay a “success fee” based on a percentage of the total transaction price. The percentage often depends on the complexity of the transaction and can range anywhere from 1-10%.
However, in this business, and as outlined in the above points, you get what you pay for. A professional broker crosses their Ts and dots their Is, overseeing every detail to ensure a successful transaction. If your paperwork isn’t pristine or done just right, your deal could be tossed and you’ll be back to square one on your search for a new buyer.
If you’re still on the fence about hiring a billboard broker, here are some more questions to ask yourself.
Still unsure if a broker can, or will, help with your goals?
Stark Capital Solutions is always available for free consultations. We’re down to Earth and trusted advisors with the professionalism, experience and connections you need to get your billboard bought or company sold. Contact us today to set up your appointment.