How Much Do Business Brokers Charge in Canada?

Business brokers charge a commission on the final sale price, paid at closing, and the rate usually falls as deals get larger. The International Business Brokers Association (IBBA), a US-based association, says business broker commissions on Main Street sales can range from 8% to 15% of the final sale price and may be subject to an agreed minimum (IBBA, Your Guide to the Business Brokerage Profession, 2021).

How broker fees are structured

Most Canadian business brokers work on a success-fee model: you pay nothing unless the business sells. The commission is calculated as a percentage of the final transaction value and is paid at closing from the sale proceeds.

Two common structures exist in the Canadian market:

Straight percentage. A single rate applied to the full sale price. Typical for transactions under $2M. A broker might quote 10% on a business listing for $800,000 — meaning their fee at closing is $80,000.

Upfront fee plus success fee. Some brokers charge an upfront fee, for example for a Broker Opinion of Value, which is then applied against the closing commission (IBBA, Your Guide to the Business Brokerage Profession, 2021). This structure signals that the broker expects meaningful work before a deal closes; ask whether the fee is refundable.

What drives the rate

The rate a broker quotes typically depends on three factors:

Deal size. Smaller deals carry higher percentage fees. A $300,000 transaction at 10% requires the same or more broker effort than a $2M deal at 5%, because the work of preparing a business for sale, marketing it, and managing due diligence does not scale linearly with price.

Business complexity. Businesses with multiple locations, complex financials, or thin documentation commonly carry a premium because they require more preparation work and take longer to close.

Broker experience and specialization. Generalist brokers typically quote at the lower end of the range. Specialists with demonstrated deal flow in a specific vertical or deal-size band may command higher rates and are often worth it — a specialist's buyer network and industry knowledge can meaningfully affect final price, not just the time to close.

The Lehman scale

Some M&A advisors use a tiered structure based on the Lehman formula or a modified version of it. The classic Lehman Formula charges 5% of the first $1 million, 4% of the second million, and so on down to 1%; "Double Lehman" starts at 10% and falls to 2% (Firmex, Global M&A Fee Guide 2024-25). Brokers handling smaller deals more often quote a flat percentage.

What to ask before signing

Before engaging a broker, clarify:

• Is there an upfront retainer, and is it refundable or credited against commission?
• What is included in the fee — marketing costs, professional photos, OM preparation?
• What is the minimum fee if the deal closes below the listing price?
• What is the exclusivity period, and what happens if you find the buyer yourself?

The engagement agreement governs all of this. Read it carefully, or have a lawyer review it before signing.