Question: I’ve been thinking of selling my business for some time now and I was wondering how long it usually takes to sell a business?
Submitted By: Jane T.
This is a question that we get asked a lot, and unfortunately there is no set answer that we can give. For the sake of answering this question we will only be looking at the timeframe from the day advertising begins, so bare in mind that preparation time will be needed before going on the market.
The reason that we cannot give a specific answer is that there are far too many variables with businesses to allow for a ballpark figure. That said, there are certainly things that you can do to try to speed up the process.
- The first thing we should mention, and perhaps the most obvious, is to make sure that the business is priced realistically. Your first hurdle in this whole process is to get enquiries and if your business is overpriced you will find that your enquiries will be limited and will often produce leads that are not prepared to take their enquiries past the initial stages.
- The second thing you can do is to be quick and forthcoming with information. Many of the hold ups during the enquiry stage will often come from a lack of preparation on the vendor’s part. I am aware that this is the second time in this response that we have mentioned ‘preparation time’, and that’s because it’s important. Make sure that prior to going on the market you have already prepared information such as profit and loss documents, information summaries for the business, equipment lists etc. The advantage of having this information prepared in advance is that your possible buyers will not have to wait for it to be produced. This is good for two reasons: one, because it helps maintain momentum; and two because it reflects positively on you and inspires more confidence.
- The third thing you can do is to have your legal documents prepared (there’s that word again) with your solicitor already. You would be surprised how much time can be lost with this step if it is done too late in the process.
- Fourth: Be active. Answer every phone call and remember that you have something that somebody else wants so it is your job to make it as accessible as possible.
Beyond these points there are a number of factors that you may not be able to control that will affect the time frame such as market sentiment, the growth or diminishing of your industry, and of course your businesses performance over the past few years. These are things that can drastically affect the speed of your sale.
So, in short (or long, as it were) it would be irresponsible of us to give you an indication as to how long it would take to sell your business without analysing it first. That said, in a best case scenario, from the date of going on the market we’ve had businesses that have settled in under 30 days. On the other hand we’ve had businesses on the market for almost twelve markets before a suitable buyer was found. It all depends on your personal circumstances.