Selling a business is a different process for everyone. Each business has its own industry to consider, different assets and cash flow, and each owner has a different vision for the future of the company. That being said, there are still factors that apply to any business sale. How long does it take to sell a business? That depends entirely on your efforts, whether or not you’re getting help, and if you know where to list. According to Inc, selling a business takes, on average, around six months or longer, but is subject to a number of considerations. This number is merely an average based on national trends and doesn’t necessarily reflect every business’s situation.
Valuing Your Business Takes Time
You’ll likely spend at the very least a few weeks’ time determining the value of your business. This is a time-consuming process, as it involves taking a close look at financial information, the assets your business has in its possession, as well as putting all of that information in a detailed report for your potential buyers. This report should be as detailed as possible and include both intangible and tangible assets, your profits and expenses, and any outstanding debts your company is responsible for.
If you’re struggling with the valuation process, it’s understandable, as not everyone is great with numbers. Your account can help you in this situation, or, if you prefer, you can hire a broker or other expert to help you out. Learning how to sell a business easily can benefit you down the road if you decide to buy or sell another company, so pay close attention to the process and all of its little details.
Listing the Business
This part of the sales process is probably the most time-consuming. You’ll pretty much be at the mercy of yours and your broker’s marketing efforts and the effectiveness of the listing service you use. It can take months to reach the right buyer, or it can take only a few days. The length of time you have to wait to get in touch with buyers depends entirely on how well you’ve valued the business, your place in the industry, and how well you’re marketing the sales post. Just because you’ve listed on a website, doesn’t mean you don’t have to help spread the word.
There are dozens of ways to list a business for sale and plenty of websites to choose from, but the way to get the best results and reach the most people is to diversify your efforts. Posting on only one website gives you access to only that site’s users, which can be incredibly limiting. Post your business on multiple sites if you can, and utilize tools like social media as well to help spread the word about your business for sale.
The Buying Process
Once you’ve reached the right potential buyer, you’ll be entering the often lengthy negotiation process to complete the sale. You’ve made it this far, now all you have to do is close the sale, right? Unfortunately, this isn’t as easy as it sounds, as many buyers will make offers that are too low, or that you find downright offensive. You should definitely have a minimum in mind that you would be willing to sell the business for, and this should be based on the value of the business as a whole; however, you also don’t want to resort to the minimum if you can get as close to your asking price as possible.
Negotiation may take several weeks or even several months to complete, but you’ll feel much better at the end of it knowing you got the best price for all of your hard work. Investors and prospective CEOs want to acquire the business for the lowest price possible, but that doesn’t mean you have to settle for it; especially if you’ve valued your business properly!
After the Sale
Once you’ve sold your business, if you chose to stay on with the company, you’ll get a first-hand look at how the new owner will direct the business. You might find you disagree with the new direction, which makes it important to know who you’re selling to. Don’t be afraid to ask questions about where the new owner(s) plan to take the business. Your business is the product of hard work and dedication, and you don’t want someone to run it into the ground within the first year of selling it.
The Bottom Line
Selling your business will likely take several months to accomplish, but there is a chance that you get lucky and find the right buyer within weeks of listing. Be sure you value your business properly, don’t settle for low-ball offers, and use a broker service if you’re feeling lost during the selling process.