How Long Does it Take to Sell a Business?
September 19, 2020
Most people who sell their business do not expect this to be easy, but many are surprised at how hard it can actually be and how long it sometimes takes to get a good price, in a good time.
However, it is important not to let fears lead you at the time of sale. Most of the frustrations and challenges in the experiences of sellers can be easily avoided with some helpful information. There are a lot of challenges you have to go through in the process of selling a business; below, you can read about those that you must avoid, because they have a significant impact, both for selling the business and for your peace of mind.
- Insufficient preparation
Lack of training is by far the most common mistake that small business owners make. Just as you have improved your house a little before you put it on sale, it is just as important to analyze and fine-tune certain aspects of your business before putting it on the list of selling businesses. Financial documentation, profitability, issues related to renting space, employees and other issues will not only influence the stability, but will also affect the price of your business, on the market.
- Distrusting the professionals
You may be an expert in running your business, but not in selling it, unless you are also a broker, a lawyer etc. Therefore, do not hesitate to take advantage of the experience business brokers provide.
- Leaving all tasks in the care of the professionals you hire for this job
On the other hand, be aware that once you hire a broker, your job is not over! Even if the broker will work hard to promote your business to potential buyers, there is no one has better motivated to sell it than you, or with more knowledge about it than you have. So, make sure to have a conversation with your broker about how you could promote the business too without following in his footsteps, so that you two do not work on the same things.
As a salesperson, you want to present your business in the best possible light, but that does not mean you have to exaggerate. Misrepresentations will influence prospective buyers, when they review the current financial statements, but will also become the basis for legal actions, after the sale.
- Failure to set post-sale terms
Many homeowners are so focused on selling their businesses that they completely neglect the transition process that will take place after closing. Some buyers will insist that the seller stay with them for a few months, while others prefer to end the collaboration once the purchase has been made. Either option is good, as long as the buyer and seller have discussed everything on the transition process and reached a consensus.
If you take these aspects into account and work with an experienced business broker, you have the chances to sell your business in 6 months; otherwise it might take longer than 12 months.