What is a Cooperative Brokerage Agreement, or Fee-Sharing Brokerage Agreement?

Value Business Brokerage Inc. engages with business owners wishing to sell their businesses, as well as with prospective owners seeking to purchase a business.  However, from time to time it is possible for us to engage with other business brokers in order to best address our clients’ needs and to help facilitate the sale or purchase of a business.  This is called “cooperative brokerage” and it is an arrangement that allows two brokers—one for the buyer and one for the seller—two work together to help complete a sale.

How do we address the concerns of cooperative brokerage?

When Value Business Brokerage Inc. engages with a cooperative brokerage, both brokerage firms will come to agree on a contract that dictates how the brokerages will interact with each other, with each other’s clients, and how the commission will be administered.  An example of this type of brokerage agreement is available on our website and demonstrates Value Business Brokerage Inc. as the selling brokerage firm, but note that this language is generic and will be altered to meet the needs of an actual engagement.  The cooperative brokerage agreement should address the following concerns:

  • How, if at all, any expenses will be shared between the brokerage firms
  • How the firms will divide the sales commission
  • The manner in which the firms agree on showing the business to prospective buyers
  • Any type of confidentiality clauses that the parties agree to, and
  • Any other concerns that either firm has regarding the sale.

If you are a business broker in need of a buyer or seller for your client, please contact us today at (703) 527-5102 or email us at broker@valuebusinessbrokerage.com to get started.