How Long Does It Take To Sell a Business?

When you decide to sell your business, you’re likely to want to get it done quickly. Unfortunately, there is no hard and fast rule for how long it takes to sell a business and you should settle in for a long ride. Generally, businesses take upwards of six months to sell, and sometimes it can take more than a year.

Many factors affect the length of time it will take for your business to sell, and in this article, we’re going to cover them to help you understand a little better. Additionally, we’re going to look at ways you can prepare your business for sale and the factors that make people decide to sell in the first place. Take a look below to find out more now.

What Factors Affect the Length of Time It Takes To Sell a Business?

If you’re looking for a quick sale, then selling a business isn't going to satisfy this need. In fact, there are quite a few factors that will lengthen the process significantly that you should consider before deciding to sell. We have examined these below.

#1 Preparation

Being prepared is the key to most things in life, and it is a huge factor in the sale of your business. Preparation includes already having an exit strategy in place which can dictate how and when you will sell. Having an exit strategy will also ensure you know your business’s value and how much you’re looking to sell it for. 

Another tool for preparation is documentation. You are likely working with a business broker who should help you through the process of gathering all the correct documentation for the sale of a business. Unfortunately, procedural delays can add time to the length of the sale of your business.

An easy way to avoid any procedural delays is to work with a platform like Eden Exchange. We make the process of selling your business as simple and easy as possible, helping with paperwork and ensuring that your business is seen by active buyers.

#2 The Current Market

Market conditions affect sales of all kinds, from houses to businesses. Unfortunately, recent years have seen a dip in almost all markets due to the COVID-19 pandemic, and as such, many are only just beginning to recover.

Assessing the market conditions before going through with your sale is an easy way to limit the time it will take. If you know that the market conditions aren’t great at the moment, consider holding off if you can.

#3 Customer Demand

As with market conditions, this one is more difficult to predict but does go hand in hand with what is happening in the markets. If buyers are more hesitant to make financial commitments, or your industry is in decline, it may take much longer for your business to sell.

How Can I Prepare To Sell My Business?

Selling your business is a big undertaking, and there are lots of ways that you can prepare to get this done properly and effectively. To begin with, you should set out your objectives with the sale. How much do you want to make? Do you want to sell to someone you know? Or, do you want to sell to a big company? Knowing the answers to these questions will ensure you forge ahead in the right direction with the sale.

Next, you need to get all of your records in order. We discussed earlier how procedural delays can cause your sale to take much longer, so having things like financial reports, asset valuations, and turnover data already prepared can help any prospective buyers get a good sense of what is going on with your business.

If you are selling a physical business, like a brick and mortar store, we would next advise you to give it a really good clean and making sure it looks as good as it can. First impressions make a huge difference, so even if your business has huge profits and a great future ahead, a potential buyer may be turned off if your premises don’t look their best.

In preparation for a sale, you should also review any processes within your business and streamline them as best as possible. Making sure things like invoicing and credit control are as efficient as possible will make you much more attractive to buyers.

Lastly, you need to do some due diligence. This could include checking contracts, going over intellectual property and ensuring all registrations are up to date, and giving any supplier terms and conditions a once over just to make sure anything and everything that could come up has already been reviewed.

Why Do People Sell Their Businesses?

If you have been considering selling your business for a while, you may wonder if you have made the right decision, if it is the right time, and what factors usually influence people to sell their business. 

The answer is actually quite varied.

#1 Retirement

One of the top reasons many people decide to sell and move on is that they have decided to retire. If a business owner reaches retirement age and has no one around them that they would like to pass the business onto, they usually decide to sell it to make a profit on their hard work and leave the world of work behind completely.

#2 Health Reasons

Quite similar to retirement, but health reasons don’t always hit us perfectly at retirement age. In fact, ill health can hit us anytime in our lives and make it incredibly difficult to put in the hard work that is needed to run a business.

#3 You Want a Change

Sometimes, it is just time to try something new. Many business owners find that after working in one industry for so long they want to move on and try new things. If you have lost interest in your business or your new hobby is taking up all of your time, you might have reached a point where it is a good idea to sell and move on.

#4 The Industry is Changing

A big concern for lots of businesses is changes in their industry that may affect profitability. If technology or a new way of thinking is making your business obsolete, you may decide it is a good time to cash in and move on.

#5 You’ve Taken The Business as Far as You Can

You may have reached a point in your business where you think you have taken it as far as it can go. At this point you may sell it on to others who could take it further. This could mean selling to a company with more funds or onto the younger generation to innovate.

Selling a business takes at least 6 months, if not longer. There are ways that you can prepare for this and ensure the sale goes through as quickly and efficiently as possible, but many outside factors will also affect the sale and are generally out of your control.

If you’re looking for an easy-to-navigate platform to sell your business on, then why not get in touch with Eden Exchange today? We’re an innovative and forward-thinking space to showcase your business to make sure it is seen by active buyers in your area.

Who we are

Eden Exchange is an integrated multi-channel platform, simplifying business buying and selling. We match, refer and connect business buyers, sellers & brokers in an ecosystem that facilitates frictionless franchise, business and finance transactions. Visit www.EdenExchange.com and connect with our engaged and multidimensional transaction network today.