Owners ask me this directly, and they should. A brokerage fee on a $3M transaction is real money, and anybody selling you the service has an obvious interest in the answer.
So here is the honest version, including the cases where the answer is no.
When You Probably Do Not Need One
Three situations where paying a fee makes little sense:
• You already have the buyer. A key employee, a partner, a family member or a competitor who has approached you directly. You still need a CPA and an attorney, and you still need a defensible valuation so you are not negotiating blind, but the expensive part of brokerage is finding and qualifying buyers and that work is already done.
• The business is very small. Below roughly $250,000 of value the fee structure stops making sense for either side. Those transactions happen, and they happen on marketplaces with an attorney handling the paperwork.
• You are transferring inside the family with no price discovery needed. That is an estate and tax planning exercise. It needs a valuation and a lawyer.
Everything below is about the cases that are not those.
The Core Problem in This Market
A price is set by competition among buyers. That is the whole mechanism. If two qualified buyers want your company, you have a market. If one does, you have a negotiation you are losing.
The Chattanooga metro is about 588,000 people across six counties, with roughly 297,000 nonfarm jobs as of November 2025. Metropolitan Atlanta is about 6.4 million. That gap is the single most important fact about selling a business here, and it does not mean your business is worth less. It means the buyers who would pay the most for it mostly do not live here, and nothing about listing a business locally reaches them.
An owner selling on their own in a market this size has a structural problem. The pool of local buyers who can write the check, qualify for the debt and actually run the company is small, and once you have exhausted it there is no obvious next step. The businesses that get the best outcomes here are the ones marketed into Atlanta, Nashville and Knoxville, and to individual buyers relocating for the right company. Atlanta is under two hours down I-75.
Confidentiality Is Genuinely Harder Here
In a metro this size the trade communities are small. Your competitors know your service manager. Your banker plays golf with your landlord. A single conversation with the wrong person moves faster and further than it would in a larger city.
What happens when word gets out is not hypothetical. Your best employees update their resumes. Customers with a renewal coming hedge and take a second quote. A competitor uses it in a sales call, accurately, which is worse.
A professional process markets a blind profile that describes the business without identifying it, and releases anything specific only after a signed non-disclosure agreement and financial pre-qualification. In this market that profile has to be written more carefully than in a big city. "Commercial HVAC contractor in Hamilton County with 22 technicians" is a description that identifies you to every competitor you have. Getting that balance right is most of the skill in the first month, and it is not a thing a spreadsheet does.
What Selling It Yourself Actually Costs
The case for doing it alone is the fee, and the fee is real. What owners underestimate is the other side of the ledger.
• Pricing error. The most common self-managed outcome in this market is a price set from a competitor’s rumor or an online calculator. Too high and the business sits until it is stale. Too low and you find out at closing, when a buyer accepts immediately. Either error is usually larger than the fee.
• Time taken from the business. A sale runs six to twelve months and consumes real hours: fielding inquiries, most of which go nowhere, assembling documents, answering the same questions repeatedly. Revenue that dips while you are distracted gets renegotiated by the buyer, and that renegotiation comes out of your price.
• A single buyer instead of several. Without competition you are not negotiating, you are accepting. This is the largest cost and the hardest to see, because you never learn what the second buyer would have paid.
• Terms you did not know were negotiable. Escrow size, holdback period, working capital target, non-compete geography, the standby terms on a seller note. Each of these is worth money and each gets set inside the letter of intent.
• Deals that die in diligence. Most transactions that fail, fail after the LOI. Somebody has to keep the landlord, the lender, two attorneys and an accountant moving in the same direction every week for three months.
None of this means a fee is always worth paying. It means the comparison is not the fee against zero.
What the Fee Actually Buys
Six things, and it is worth being specific because "we market your business" is not an answer:
• A defensible opinion of value. Built on your actual recast financials and comparable transaction data. This is the number you negotiate from, and getting it wrong in either direction is expensive.
• Confidential marketing. The blind profile, the marketplaces, the direct outreach to strategic buyers, and the buyer database. In a market this size the outreach matters more than the listing.
• Buyer qualification. Proof of funds or lender pre-qualification, executed non-disclosure agreement, and enough background to judge whether they can run it. This protects your time as much as your information.
• The recast and the lender package. Add-backs a seller believes in and add-backs a credit committee will allow are different lists. Reconciling them before a lender sees the file is what keeps a deal from dying in underwriting.
• Negotiation on terms, not just price. Since SOP 50 10 8 took effect on June 1, 2025, an SBA change of ownership needs a minimum 10% equity injection, and a seller note counts toward it only on full standby for the life of the loan and only up to half the injection. Two offers at the same price can put very different money in your hands, and knowing which is which is the job.
• Keeping the transaction moving. Diligence runs thirty to ninety days and it is where deals die. Somebody has to chase the landlord, the lender, both attorneys and the accountant, weekly, while you run the company.
The Two-State Problem, Which Is Specific to Here
Three of the six counties in this metro are in Georgia. Catoosa, Dade and Walker sit immediately south of the city, and a company in Ringgold or Fort Oglethorpe is a Georgia business with a largely Tennessee customer base and labor pool.
That has consequences a single-state broker will not have thought about:
• Tax. Tennessee has no personal income tax, and taxes entities at 6.5% of net earnings and 0.25% of net worth. Georgia taxes the owner’s gain at a flat 4.99% for 2026. Which produces the better outcome depends on entity, basis and allocation, and it should be modeled before a price is agreed.
• Licensing. Tennessee and Georgia waive the trade exam for electrical contractors, though the Tennessee business and law exam still applies. Georgia offers no reciprocity for HVAC or plumbing. A buyer who cannot legally work the Georgia half of your customer base is buying a smaller business than the one you are selling.
• Registration and payroll. If crews cross the line, obligations run in both states. A buyer’s accountant finds every gap, and finding one mid-diligence costs leverage at the worst moment.
• Closing costs on real property. Tennessee charges realty transfer tax of $0.37 per $100. Georgia charges $1.00 for the first $1,000 and $0.10 for each additional $100, plus an intangible recording tax of $1.50 per $500 of the note capped at $25,000.
The firm is licensed to transact in Georgia, Tennessee and South Carolina, and Devon Griger is admitted to the bar in Georgia and Tennessee. On a file that touches both states that is the practical reason it matters.
What a Broker Does Not Do
Worth being clear, because overselling this is common:
• A broker does not make an unprofitable business sellable. If the earnings are not there, no process manufactures them.
• A broker does not clean your books. That is a bookkeeper and a CPA, and it has to happen before going to market.
• A broker does not give tax advice. Entity structure and purchase price allocation belong to your CPA, and they are the largest lever on what you keep.
• A broker does not draft the purchase agreement. That is an attorney, and it is not optional.
• A broker cannot guarantee a sale. Anyone who does is telling you something they cannot know.
How to Choose One Here
Ask five questions and listen for specifics:
• How will you reach buyers outside this metro? If the answer is only a marketplace listing, that is not a strategy in a market of 588,000 people.
• Are you licensed in both Tennessee and Georgia? If your business or your building touches the Georgia side, this is not a technicality.
• What have you closed in my industry and at my size? Selling a $500,000 retail store and a $6M industrial services company are different jobs.
• Walk me through your recast on a deal like mine. The answer tells you whether they have sat in front of a credit committee.
• What is the fee, and what is the term of the agreement? Both should be stated plainly and in writing before you sign anything.
How Fees Usually Work
Business brokerage in this range is generally a success fee, paid at closing, calculated as a percentage of the transaction value, with the percentage falling as the deal size rises. Larger transactions sometimes carry a retainer credited against the success fee, which exists to make sure both sides are serious.
Ask three things and get them in writing: what the percentage is and how transaction value is defined, whether seller financing and any earn-out are included in that calculation, and what the term of the agreement is along with what happens if you decide to stop. A broker who is vague about any of those is telling you something.
The number that actually matters is not the percentage. It is whether the process produces more than one qualified buyer. A fee on a competitive process beats no fee on a single unqualified offer every time, and in a metro of 588,000 people creating that competition is the entire product.
The Honest Summary
If you have a buyer already, you need a valuation, a CPA and a lawyer. If you do not, the question is whether you can reach enough qualified buyers to create competition while running your company and keeping the process quiet. In a metro this size, with a buyer pool that mostly lives somewhere else, that is a harder job than it looks from the outside.
I am happy to tell you which situation you are in before either of us signs anything.
Schedule a confidential consultation → https://calendly.com/nolan-nolanscottteam
Or call me directly at 404-247-5880. Every conversation is completely confidential.