19 Oct Timeline Checklist & Tips for Selling a Business
We manage the buyers from enquiry through to the settlement and everything in between (see our timeline checklist and tips)
It is often asked by sellers of businesses how long roughly does it take to sell a business?
Well there is a general statistic within our industry that suggests between 6-9 months of being on the market. There is so many variables that can see this change dramatically one way or the other. Some of the best businesses I have had on the market may have taken 12 months and sometimes others have taken less than 6 months.
If you have prepared your business for sale, have all the documentation ready and the business is listed with a fair return on investment and more risks eliminated than not and have a good marketing strategy you are on the right track.
So here is the general process and journey a buyer may undertake which is only a guide not the rule
- Engages the broker often through a business website
- Is provided a verbal brief or a business summary about the business
- Completes a confidentiality agreement and returns it to the agent
- Receives further information such as information memorandum and
- The broker depending on the business may want more information about the buyer before releasing
- Financials, asset lists, leases and other relevant annexures
This process may take a few days to a week generally speaking
- The broker asks or solicits feedback
- The buyer if still interested may ask questions and/or may want to see their accountant
- A process of Q & A may occur over a week or a couple of weeks
- If still interested the broker will often try to create an inspection/meeting with the owner
- The broker will then seek feedback and often further Q & A may occur
- The buyer if interested may now seek an approval in principle from their bank which may take a week or weeks
- The broker will assist and solicit an offer
- The broker will prepare sales advices for the parties to enter into a contract
- The broker will assist with the timing and general process from deposit, contract issue, exchange of contracts through to settlement to ensure everyone is on track.
This is a broad guide and many other things will need to be done and larger businesses may include more detailed steps but this is just to assist you with an understanding of some of the key steps in the process.