When sellers ask about broker costs, the honest answer is: it depends on the broker, the business, and the deal structure. But there are clear patterns. This article walks through the typical Australian fee structures and what each one actually buys you.
The two main components
1. Upfront listing or marketing fee
Many brokers charge an upfront fee of $4,000–$8,000 to put your business on market. This typically covers:
- Information memorandum (IM) preparation — a 15–30 page sale document
- Professional photography and video walkthrough
- Listings on the major Australian marketplaces (BusinessForSale.com.au, Seek Business)
- Marketing to the broker's buyer database
- Initial buyer screening and NDA management
The argument for an upfront fee: it ensures the broker actually invests in marketing your business properly, rather than relying on luck. The argument against: it shifts risk to you. If the business doesn't sell, you're out of pocket.
2. Success commission on sale
Paid only when the business sells, at settlement. Standard ranges:
| Sale price | Typical commission | Notes |
|---|---|---|
| Under $250k | 8–12% | Higher %, smaller absolute amount |
| $250k–$500k | 7–10% | |
| $500k–$1M | 6–9% | |
| $1M–$2M | 5–8% | Often sliding scale |
| $2M+ | 4–7% | Negotiable, often lower for mid-market |
Some brokers structure as "ladder" commissions — e.g. 10% on the first $500k, 6% on amounts above that. This rewards exceeding asking price.
Common alternative structures
No-upfront, higher commission
Some brokers (myself included for most Perth small business listings) skip the upfront marketing fee and roll everything into a slightly higher success commission. The advantage to you: zero risk if the business doesn't sell. The advantage to the broker: aligned incentives — they only get paid if you do.
Hybrid: smaller upfront + standard commission
A token upfront ($1,000–$3,000) covers IM preparation specifically, with normal commission on top. Common for larger or more complex businesses where the IM takes 40+ hours of work.
Hourly retainer (rare for small business)
Used for distressed sales, complex M&A, or owners who want to manage parts of the process themselves. Typically $300–$500/hour. Most Perth small business sellers will never encounter this.
Don't pay an upfront fee.
I work no-upfront-fee for most Perth small business listings. You only pay if the business sells — and you only pay at settlement.
See If We're a Fit →What's negotiable
- Commission percentage — for businesses over $1M, almost always negotiable. For small businesses, less so.
- Upfront fee waiver — many brokers will waive in exchange for a higher commission, especially in competitive listing situations.
- Listing exclusivity period — typical is 6 months. You can negotiate to 3–4 months if you want flexibility to switch.
- Marketing scope — what specific channels, listing tier, photography quality. Get this in writing.
- Settlement terms — when commission is paid (always at settlement, but specifically when funds clear).
What isn't negotiable (usually)
- Licensed broker requirement. In WA, anyone selling your business as an agent must hold a real estate license under the Real Estate and Business Agents Act 1978.
- Trust account handling. Deposits and stage payments must go through the broker's trust account.
- NDA enforcement. Buyers must sign NDAs before receiving any identifying business information.
Can you negotiate commission down to 3%?
Sometimes — for very large transactions or competitive bidding situations. Almost never for businesses under $1M. The reason: the work involved in selling a $400k business and a $4M business is roughly the same. The lower the price, the higher the % needs to be to make the broker's time worthwhile.
If a broker is willing to commit to 3% on a $500k business, ask hard questions about what marketing they'll actually do. There's often a cut-corners problem hiding behind cut-rate fees.
How to compare broker quotes
When you're comparing brokers, calculate the total cost as a percentage of expected sale price:
Total cost = Upfront fee + (Commission × Expected sale price)
For a business expected to sell for $800k:
- Broker A: $5,000 upfront + 8% commission = $5,000 + $64,000 = $69,000 (8.6%)
- Broker B: $0 upfront + 10% commission = $0 + $80,000 = $80,000 (10.0%)
- Broker C: $3,000 upfront + 7% commission = $3,000 + $56,000 = $59,000 (7.4%)
Broker C is cheapest in absolute terms — but if Broker A is going to actually sell your business and Broker C isn't, the cheap quote is the most expensive option. Track record and list-to-sell ratio matter more than the fee headline.