How Do Business Brokers Get Paid? Breaking Down the Commission Model
Dylan Gans
April 14, 2025 ⋅ 6 min read
For most owners, selling a small business is uncharted territory. Before putting their business on the market, sellers ask, “How do business brokers get paid?” But what they really want to know is whether a broker’s fee structures reflect real value
Understanding broker compensation models helps sellers choose smart, fair, and transparent models that allow them to keep more of their profits.
How Are Business Brokers Compensated?
Understanding how business broker fees work is key to avoiding overpriced or outdated commission models. Most business brokers follow one of three common fee models: Commission-only, monthly retainer, or a hybrid structure that combines the two.
The typical business broker fee—especially in commission-only models—ranges from 10% to 15% of the sale price. But, the real cost can vary widely depending on the broker’s experience and approach.
Evaluating these risks and rewards lets sellers choose broker compensation plans that align with their goals.
Commission-Only Broker Fee
In a commission-only model, business brokers charge a percentage of the sale price—but only after the deal closes. For owners selling a business quickly or on a tight budget, this setup may seem low-risk…until the pressure to accept a less-than-ideal offer kicks in.
Commission brokers may prioritize speed over getting the right deal, jumping on initial offers even if they aren’t optimal.
Pros
No upfront fees: Sellers can test the waters of selling the business without a major financial commitment as there are no upfront fees.
Brokers close deals faster: This approach benefits those selling with urgency. A broker’s income depends on closing, so they’re often motivated to list the business, respond to buyer inquiries, and push the transaction along as quickly as possible.
Cons
Rushed, low-quality deals: Payment only happens when a deal closes, so brokers may engage with the first legitimate buyer instead of waiting for a buyer who offers greater value for the seller.
Doesn’t prioritize seller timelines: Brokers direct efforts to faster-moving deals and may not prioritize businesses wanting to wait for the right price or timing. This pressures sellers to accept a deal to meet the broker's timelines, even if doing so puts value and/or fit second.
Monthly Retainer Arrangement
Some brokers operate strictly on a retainer basis, charging sellers an upfront monthly fee whether or not a sale takes place. This model often includes hands-on strategy, frequent updates, and tailored guidance, appealing to sellers seeking deep involvement and ongoing consultation.
While some brokers may offer a flat-fee version of this model, it’s rare—especially outside the middle market, where deals tend to be larger and more complex.
Factors such as the business's size and complexity and the broker's specific fee structure influence a business's monthly retainer. However, a retainer does not guarantee a successful sale, which means a seller can incur losses if the company stays on the market for too long.
Pros
Consistent support and personalized service: Ongoing fees motivate brokers to improve marketing materials, financial packaging, and long-term outreach.
Better branding, packaging, or detailed valuations: Since sellers pay brokers regardless of the outcome, they may take on fewer clients at once, giving each listing more time and care.
Cons
Seller takes on financial risk: Sellers pay brokers even if they don’t generate serious buyer interest, eating into their capital during the transition.
Less urgency to close: A broker’s income doesn’t depend on a successful sale, so they may not push to close deals. Sellers aiming for a quicker exit could find themselves waiting longer than expected.
Hybrid Model (Retainer + Commission)
This structure is popular with boutique business brokerage firms that cater to sellers looking for deeper strategy, better outreach, and higher-quality prospective buyers. The retainer helps fund more robust marketing, while the commission motivates brokers to close.
Setting clear agreements highlighting what the monthly retainer covers and how much the success fee is lets the seller hold the broker accountable.
Pros
Balanced incentives encourage progress and quality: Brokers earn a portion upfront. As a result, they provide a more consistent workflow and stronger deal preparation as they still have a financial stake in closing the deal.
Partnership-style engagement: This model benefits owners who need regular updates and strategic planning and helps them navigate complex buyer conversations. It’s often used for high-touch transactions that benefit from collaboration over several months.
Cons
Requires upfront spending: Risk-averse or cash-conscious sellers still need to commit funds early, even if they’re unsure how long the sale process will take.
Complex pricing can cloud transparency: Unclear success and retainer fee agreements prevent sellers from measuring value, tracking deliverables, or holding the broker accountable if progress stalls.
How Do Traditional Broker Fees Impact Sellers?
Broker fees can be financially and emotionally draining for sellers. Traditional brokers often charge 10–20% of the final deal amount and other fees.
These costs hit business owners especially hard when the business is under $10 million in value. And while some broker fees may be tax deductible, sellers should always check with their accountant before making assumptions.
Sellers working with traditional brokers may face:
Confusion around deliverables and timelines when the broker doesn’t clearly outline what’s included in the service or how long the process will take.
Disappointment with slow or no results when working with brokers who lack a strong buyer network. Months can pass without offers or meaningful engagement despite ongoing retainer payments.
Frustration from unclear expectations and mismatched incentives, especially when a seller gets paid regardless of the results. Sellers may feel like they’re carrying all the risk, which leads to frustration.
And the biggest challenge? Sellers may end up paying thousands upfront without guaranteeing their business will sell.
How Do Business Brokers Get Paid, and Is There a Better Way?
Sellers often ask how business brokers get paid to better understand if a broker service is worth the cost. Broker services often rely on outdated sales models, slowing the sales process.
But you need a better solution if you're looking to sell your business efficiently—without excessive fees or outdated processes.
Baton Market helps sell businesses faster, with clear pricing and expert support from day one.
Unlike traditional brokers, Baton Market doesn’t use a one-size-fits-all model. Our platform offers multiple plans depending on seller needs, requiring no upfront retainers.
Our pricing model includes:
Free valuation: Sellers immediately get a realistic business valuation at no cost.
Lite and Premium options: Pick the right level of support based on your confidence and timeline.
Clear, capped pricing: Baton Market’s success fee is typically one-third of what traditional brokers charge, letting sellers save 50% on broker fees.
How Does Baton Market Deliver Results Without the High Fees?
Baton Market’s process relies on smart data, human expertise, and transparency. Our tech eliminates many of the pain points for small business sellers by providing:
50% faster timelines than the industry average
Smart buyer-matching powered by vetted data
Weekly updates and progress tracking to keep sellers informed
Skip the Guesswork and Sell Smarter With Baton Market
Knowing how business brokers get paid is only the beginning. Choosing a partner who truly aligns with your goals makes all the difference.
Traditional business brokers charge high commissions and upfront retainers that can wipe out your hard-earned equity. If you’re ready to sell your business more thoughtfully, Baton Market is here to help.
Baton Market delivers 10x smarter results through fair pricing and transparent support.
Start with a free business valuation. You’ve got options—and we’ll help you find the right one.