Selling a business is not an easy endeavor. It takes commitment and proper planning to sell a business successfully. The primary goal when selling a business is to usually sell for as much money as possible in the smallest time frame.
Selling your business can be a tedious process. When you consider factors like the prospective buyer, purchase price, type of business, location, structure and organization that could affect the timeline of a sale, it should come as no surprise that selling a business takes a while.
A 2022 study by IBBA shows that, on average, it takes 6-10 months to sell a business, and only 20-30 percent of the companies that go to market sell.
However, by getting to know how the selling process works and putting together an effective strategy, you can sell your business quickly and for a profitable price. In this guide, we've outlined five steps to sell a business quickly.
5 steps to sell your business fast
There are several ways to go about selling your business, and your approach might differ slightly based on whether you're trying to sell a large company or a small company. Here are five steps you can actively take to sell a business quickly.
Prepare your business for sale
The first and most important step is getting your documents in order. Ensure you tidy up your older records dating back to 4 years. This is because, during the due diligence process, the prospective buyer will review all relevant historical business data.
Having your documents ironed out signals to the buyer that you have your affairs in order. It also helps you facilitate a smoother transfer after the sale is complete. Here's a checklist of documents and information to prepare for prospective buyers:
- Ensure your tax returns and financial records are in order.
- Provide all legal documents, including leases, contracts and agreements, etc.
- Collate all useful customer information.
- Document the business's organizational structure, operations, and systems.
- Provide unaltered business assets and inventory records.
Determine the accurate value of your business
When you start considering selling your business, knowing how buyers will value your business is a great place to begin. Here's where getting a business valuation proves useful. A business valuation evaluates a business's financial data and assets to determine its worth, which informs the asking price.
Additionally, if you only plan to sell your business in the near future, knowing your business's value helps you work to increase its worth. By improving the right metrics, such as the value of your assets, how much revenue your business generates, and intangible entities like your brand and reputation, you can dramatically drive up the value of your business.
Have a marketing plan you can leverage
Your marketing plan can benefit your buyers, especially if you've got a proven track record of raising awareness, generating interest, and setting your business apart from competition. A buyer would want to know your unique selling proposition and how your products and services resonate with customers.
So, make buyers understand your strategy for generating leads and boosting sales and future growth opportunities. Buyers want to be assured that your marketing strategies can be replicated and applied after they purchase the business.
Hire a business broker
You might not require a business broker when selling to a trusted friend or current employee. But if you do decide to use one, it's essential to find a competent business broker to guide you on how to sell a company. They can help free up time for you to focus on running the business while they look for qualified buyers.
As much as selling a business is a financial decision, it is also a personal one. A broker can help guide you through the personal aspect of a business sale. They can help supply answers to questions potential buyers may have concerning the reason why you're selling your business.
Hiring a broker can be tricky, and you want to ensure you get it right. Here are some questions to ask before you hire:
- What are your qualifications and certifications?
- How do you plan to market this sale?
- How much do you charge for your services?
- What's your success rate and job history?
- What other things should I expect from using your services?
We can match you with the right professional agent for your business if you're struggling to find a suitable broker. Click here to find a business broker.
Find the right buyer
A broker can help you smooth things along, but settling for the right buyer and finalizing the process can still be a hassle. Here's a list of things you want to make sure you're checking during the sales process:
- Deals falter, so make sure you get at least three potential buyers.
- Maintain communications with prospective buyers.
- Ensure prospective buyers qualify for financing before sharing any vital detail about your company.
- Negotiations are good but do not settle for less, especially considering the company's future value.
- Work out the nitty gritty with your accountant or lawyer, and make sure to put agreements into writing. Also, the buyer should sign a confidentiality/ nondisclosure agreement to protect your information.
FAQs on selling your business quickly
How long does it usually take to sell a company
On average, it takes about 6 to 10 months to sell your business.
How do you value a business
You determine the value of a business by adding up the value of assets, including inventory and equipment, and subtracting any debts or liabilities.
Find out more about valuation methods, benefits and examples in our guide on valuing your business.
How do you sell a business quickly
There's no one size fits all way to sell your business quickly. However, by implementing some tried and tested strategies like getting your documents in order, hiring a broker, and doing a business valuation, you can sell your business faster.
How do you sell a business without a broker
You sell your business without a broker by taking charge of everything involved in creating a smooth transfer of ownership to your buyer. These include negotiations, asset migration, buyer vetting, and hiring professionals to certify your legal fees and financial statements.
Can you sell a failing business
Yes, you definitely can, although the process will differ from selling a profitable business. For one, much time and effort is spent on the due diligence process to give buyers a better understanding of why the business is failing.
If you'd like to understand more about the process, you can read our selling a failing business guide.
The bottom line: selling your business quickly
Several factors affect how fast you can sell a business, including the size of the company. Taking practical measures such as hiring a broker, knowing your business's value, and getting your financial and legal affairs in order will help speed up the sale process.
Equipping yourself with the right information is vital to a successful business sale. If you’d like, you can spend time reading through our articles dedicated to business owners looking to sell their business.
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