Hello, business owners and entrepreneurs! Nate Lind here, your go-to online business broker. Today, we’re diving into a question I hear all the time: “What is a realistic timeline for the sale process?” If you’re asking yourself, “how to sell a business,” or perhaps “how do I sell my business,” you’re in the right place.
So, you’ve decided to sell your business. Congratulations! That’s a big decision, and now you’re probably wondering how long this whole process will take. Is it like selling a hot dog at a baseball game, or more like convincing your teenager to clean their room? Spoiler alert: it’s a bit closer to the teenager scenario.
Preparing Your Business for Sale
The first step is preparing your business for sale, which can take anywhere from one week to three years. Yes, you read that right. This is where you clean up your bookkeeping and taxes. You might be able to do 1-2 years worth of bookkeeping in one day, or it might take you forever if you procrastinate.
Some people have never done their bookkeeping and need to go transaction by transaction, categorizing everything. If that’s you, I recommend doing this yourself using QuickBooks Online and setting up automatic rules. When you download your transaction data, QuickBooks will automatically categorize your transactions for you. Then you just need to review it to ensure it’s 100% correct.
I cover categories and add-backs in my book, which you can find linked in the description. These are crucial elements to understand because buyers will want to see accurate income statements, balance sheets, and cash flow statements. They’ll likely ask for your bank statements and may even re-do the bookkeeping or spot-check it to see if you’re keeping accurate records.
If one thing is off, it creates doubt in the buyer’s mind about everything else you present. These financial statements allow you to showcase your business at its best! If you can’t handle the bookkeeping yourself, hire a bookkeeper from Indeed.com or Fiverr.com. However, you must review their work because bookkeepers won’t know the details of your Amazon purchases. Are they samples from competitors or competitive research? Or was that a new video game for your kids?
This isn’t just about putting lipstick on a pig. We have to be professional here! But seriously, getting your business ready is crucial and sets the tone for the rest of the process.
Listing Your Business
Once your business is looking polished, it’s time to list it. This listing stage can take about two weeks. However, finding the right buyer can take up to six months. You might wonder why it takes so long. Well, finding the right buyer is a bit like dating. You don’t just settle for the first person who swipes right. You want someone who truly clicks with your business, someone who sees its value and potential. So, patience is key, grasshopper.
Due Diligence and Closing
After you’ve found your perfect match – the buyer who’s head over heels for your business – you enter the due diligence phase. This part is like the buyer looking under the hood of a car, kicking the tires, and ensuring there are no skeletons in the closet. This can take another 1 to 3 months. More waiting, yes, but trust me, it’s worth it.
Finally, if everything checks out, you move to the closing phase. This can take a few weeks to a couple of months. Think of it like the final countdown in an action movie. All the big moves have been made, and now you’re just wrapping things up, signing papers, and handing over the keys.
Conclusion
In total, selling your business can take anywhere from 6 to 12 months, sometimes longer. I have sold businesses in as little as two months, but that is VERY rare. Usually, it’s a marathon, not a sprint. Having a business broker like me, Nate Lind, by your side can make the journey smoother and faster. By the way, I’m a triathlete in real life, so I’m VERY familiar with planning and executing long-term projects. I’ve got the experience, the connections, and let’s be honest, the charm to help you through it.
If you found this article helpful, please leave a comment below! Also, if you want to learn more about how to sell a business, value your online business, and get the most out of it when you sell it, pick up a copy of my free book, “Maximum Exit,” here. Thank you for reading, and happy selling!
