Straight answers to the questions business owners ask most.

Business brokers in New Zealand work on a commission basis. Commission is only payable on the successful sale of your business, typically calculated as a percentage of the sale price. There may be some marketing costs to advertise your business to buyers, but there is no large upfront fee. If your business does not sell, no commission is payable.

Most SME sales take between three and twelve months from going to market through to settlement. Businesses that are well-prepared and well-priced tend to sell faster. Pre-sale preparation, including the appraisal, documentation, and Information Memorandum, typically takes one to four weeks depending on the complexity of your business.

You are not required to use a broker, but using an experienced broker typically results in a significantly better outcome. A broker brings a qualified buyer database, marketing expertise, negotiation skills, and a structured process that is difficult to replicate privately. Brokers who use a structured multi-offer process consistently achieve stronger results than private sales.

Confidentiality is one of the most important aspects of a business sale. Advertisements are written to describe the business without identifying it. All prospective buyers sign a confidentiality agreement before receiving any information. Staff are typically not notified until the agreement is unconditional, at which point the timing is managed carefully with your input. Customers and suppliers are typically only told after settlement, where you and the buyer carefully transfer those relationships.

A multi-offer situation occurs when more than one qualified buyer submits an offer on your business at the same time. Buyers are required to submit their best offer, with you then choosing one party to negotiate with. This creates genuine competition, which typically results in a higher sale price, better terms, and the ability to choose not just the best price but the best buyer.

There is no universal right time, but the best outcomes tend to come when a business is performing well, financials are clean and growing, and the owner is not selling under pressure. That said, circumstances do not always allow for perfect timing. Whether you are selling by choice or necessity, a good broker will help you present the business in the strongest possible light. Getting an appraisal early gives you time to improve the outcome before going to market.

A business appraisal is an assessment of what your business is likely to sell for in the current market, taking into account your financials, industry, growth potential, and comparable recent sales in New Zealand. It gives you a realistic price range and helps you understand what factors affect value. Joel offers free appraisals with no obligation.

Net profit is the bottom line on your accounts after all expenses including your salary, tax, interest, and depreciation. EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) strips out financing costs and non-cash items to show underlying operating performance. SDE (Seller's Discretionary Earnings) and EBIPTDA (Earnings Before Interest, Proprietors' income, Tax, Depreciation and Amortisation) both go further by adding back the owner's salary and any personal expenses run through the business. The two terms are used interchangeably in NZ business sales. SDE or EBIPTDA is the standard earnings measure for SME valuations in New Zealand because it represents the total cash benefit available to a new owner-operator. The goodwill multiple in a business sale is applied to SDE or EBIPTDA, not to net profit.

A formal business valuation is a structured legal document produced by a registered valuer, typically required for court proceedings, relationship property settlements, or specific financing purposes. A business appraisal is a practical market assessment of what your business is likely to sell for based on current buyer demand, comparable sales, and your financials. Most business owners searching for a "business valuation" are actually looking for what an appraisal provides: a clear, informed view of what their business is worth in today's market.

A business appraisal from an experienced broker takes into account your financials, industry sector, growth potential, comparable recent sales in New Zealand, and current buyer demand. It gives you a realistic price range and helps you understand what drives value. Joel Costello provides free, no-obligation appraisals for business owners across New Zealand. Request one here.

Yes, completely. There is no fee, no catch, and no obligation to proceed. Business brokers work on commission, which means the appraisal is part of the service. If a sale goes ahead and settles, commission is earned. There is no pressure to list and no contract to sign at the appraisal stage.

Absolutely. Many of the best sale outcomes start with an appraisal two or three years before the owner is ready to sell. It identifies what drives value in your business, what could be improved, and what to focus on in the meantime. Coming to market well-prepared consistently results in a better outcome than going to market unprepared in a hurry.

An Information Memorandum (IM) is a detailed document prepared by your broker that gives prospective buyers a comprehensive picture of your business. A well-prepared IM goes beyond facts and figures. It is designed to engage buyers, help them visualise owning the business, address concerns early, and lead them toward making an offer.

Due diligence is the buyer's opportunity to verify all the information provided and satisfy themselves and their advisors that everything is as represented. It typically involves the buyer's accountant reviewing financial records, their lawyer reviewing contracts and legal matters, more in-depth questions about how the business operates, and sometimes a site inspection. For most straightforward businesses this takes ten to twenty working days.

Once all conditions of the sale and purchase agreement have been satisfied, the agreement is declared unconditional. This is typically when the deposit is paid and held in a trust account, you then notify your staff, and the buyer begins arranging new contracts and building relationships with staff and suppliers. From unconditional through to settlement is typically two to four weeks.

Most business sales include a handover period where the vendor works alongside the new owner to transfer knowledge, introduce key relationships, and help the transition. For most straightforward businesses this is around four weeks, though it can be negotiated as part of the sale. The length and nature of the handover is agreed in the sale and purchase agreement.

Tax implications of a business sale in New Zealand will depend on your individual circumstances, the structure of the sale, and how assets are allocated in the sale and purchase agreement. This is an important area where you should get advice from your accountant before signing anything. Joel can help with structuring the sale in a way that works for both parties, but specific tax advice should always come from a qualified accountant.

Buying a business typically involves finding a suitable listing, signing a confidentiality agreement, having an initial call with the broker, reviewing the Information Memorandum, meeting the vendor, making an offer via a sale and purchase agreement with conditions, completing due diligence, and settling. See the full buyer process here.

From signing a sale and purchase agreement to settlement, most straightforward purchases take four to eight weeks. Due diligence alone typically takes ten to twenty working days. Finding the right business and going through the process to the point of making an offer can take considerably longer, depending on what you are looking for and what is available.

Due diligence typically covers financial records (profit and loss statements, balance sheets, tax returns for at least two to three years), legal matters (leases, contracts, employment agreements, intellectual property), and operations (key staff, supplier relationships, customer concentration). An accountant and lawyer with business sale experience are strongly recommended.

A confidentiality agreement (sometimes called a CA or NDA) is a document you sign before receiving detailed information about a business for sale. It protects the vendor by committing you not to share or misuse information about the business. It is standard practice and does not commit you to purchasing.

No. Almost all business sales in New Zealand are structured as asset sales. You purchase the tangible assets, stock, and goodwill into a new company. The existing company stays with the vendor along with all its debts, liabilities, IRD history, accounts receivable, and cash in the bank. You start fresh with a new entity trading under the same business name. This means you do not take on the previous owner's financial obligations, and the vendor retains any money owed to the business at the time of sale.

In an asset sale, the buyer acquires the business assets into a new company. The vendor keeps their existing company with its liabilities and history. This is the standard structure for SME sales in New Zealand. In a share sale, the buyer purchases the shares of the existing company itself, taking on its full history including any liabilities. Share sales are much less common for SMEs but can occur where contracts or licences cannot easily be transferred to a new entity. They require considerably more legal and accounting involvement to protect the buyer.

No. In a standard business sale, the vendor pays the broker's commission. There is no direct cost to the buyer for the broker's involvement. It is worth understanding that in a standard sale, the listing broker's primary duty is to the vendor. If you want dedicated representation as a buyer, a buyer's agency arrangement is available.

Most brokers treat a business sale as a transactional process. Joel's approach is built around deeper buyer engagement, maintaining control of the sale process, and generating genuine competition. He personally phones every enquiry, prepares an Information Memorandum designed to engage buyers rather than just inform them, and runs a structured buyer process that consistently produces multi-offer situations. He also calls every vendor regularly throughout the process so there are no surprises and no waiting for news.

Joel is based in Auckland but works with business owners across New Zealand. He specialises in small and medium-sized businesses across manufacturing, construction, education and training, automotive, professional services, cleaning and property services, and more.

Joel specialises in small and medium-sized businesses, primarily in the $500,000 to $3 million-plus price range. If you are unsure whether your business falls within this range, a free appraisal conversation will give you a clear answer with no obligation.

Everything discussed with Joel is treated in strict confidence. Your business is not advertised or listed until you have reviewed and approved all materials. All prospective buyers sign a confidentiality agreement before receiving any information about your business.

The first step is a free, no-obligation conversation. You can request a free appraisal, call Joel directly on 021 229 8070, or send an email to joelcostello@barkerbusiness.co.nz. Joel personally responds to every enquiry, usually within one business day.