So you Think your Business is Saleable? Think Again!
I have recently read a number of quotes stating that only 1 in 10 business owners successfully sell their company. Personally I believe it’s around 3 in 10 – which results in 70% of business owners not selling their business at the first attempt.
I have met owners who have been trying to sell their business for years. If you are wondering why they haven’t managed to sell then let me explain. Selling a business is similar to selling a car, although in most cases there is obviously more money involved with the sale of a business.
Years ago I purchased a lot of cars at auctions. I clearly remember many instances where I would arrive at an auction and enthusiastically find the lot number for my chosen target. Lots of people would be flocking around and examining it with a fine-tooth. It may have had a few marks but that’s expected. I would open up the boot and realise how very grubby it was inside. Some people would obviously be put off and would walk away.
Some of us would ask to see the service book and discover that the owner had never had the car serviced and that the V5 registration form was not available either. A few more people would lose interest and abandon the car whilst some would be thinking that they might be able to get a good bargain.
The driver would start the car and get ready to drive it into the auction hall. Upon listening to the engine – which didn’t sound good either, more people would lose interest. The few of us remaining would look inside at the dashboard and notice warning lights flashing everywhere – everyone would now walk away, resulting in not a single bid being placed on that car. At times the same car would go round week after week but no-one would buy it.
Similarly, when it comes to selling your business, it may appear to look good on the outside, and the numbers may be great. However, do you really know what the prospective buyers and their advisors will be looking for under the bonnet of your business? Furthermore, do you know what will actually put a buyer off from buying your company? Make sure your business is ready for the exit journey or you may find that interested parties completely lose interest and just walk away.
Please do get in touch if you have any questions or queries.
Wishing you every success.
Malcolm Murray
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FAQs – Selling Your Company
How do I sell my business in the UK?
Selling a business in the UK typically involves preparing financial information, obtaining a valuation, identifying suitable buyers and negotiating the terms of a sale. Most owners work with an M&A adviser to manage the process confidentially, approach qualified buyers and maximise the value achieved.
At Entrepreneurs Hub, we talk about five key areas that make the difference between success and failure when selling your business. Read more…
What is my business worth?
A business is typically valued using a multiple of its profit, usually EBITDA or adjusted net profit. The multiple depends on factors such as growth potential, recurring revenue, customer diversification and management strength. Professional valuation provides a realistic price range and helps position the business effectively for buyers.
Determining your business’s value is more than just calculating a number it’s complex with key factors, that said the basic equation is actually quite simple. Read more…
How long does it take to sell a business?
Selling a business in the UK typically takes between six and nine months from preparation to completion. The timeline depends on business readiness, buyer demand and the complexity of due diligence. Early preparation and clear financial reporting can help shorten the process.
When is the best time to sell a business?
The best time to sell a business is when it is performing strongly, growth prospects are clear and you are not under pressure to sell.
Business owners often achieve the strongest outcomes when:
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Profits and revenue are growing
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Financial records are clear and well prepared
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There is visible future growth for buyers
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The owner has planned the sale 12–18 months in advance
Market conditions can also influence valuations. Strong buyer demand, sector growth and favourable economic conditions can increase acquisition activity, but a well-prepared business can attract interest in most markets.
Deal activity often increases during spring and autumn, although transactions complete throughout the year. In practice, preparation and business performance usually matter more than trying to perfectly time the market.
Ultimately, the best time to sell is when both the business and the owner are ready, with the company positioned to demonstrate strong value to potential buyers.
Do I need an adviser to sell my business?
Many business owners choose to work with an M&A adviser to manage the sale process. Advisers help value the business, approach qualified buyers confidentially and negotiate terms. This structured approach can increase the likelihood of achieving a higher value and a successful transaction.
How is confidentiality protected during a sale?
Confidentiality is protected through controlled information sharing, anonymous buyer approaches and strict non-disclosure agreements. Potential buyers receive limited information initially and must sign an NDA before any sensitive details are released. Business owners approve prospective buyers and maintain visibility over all documentation throughout the process.
How do I value my business before selling?
Valuing a business before selling usually involves analysing profitability, identifying valuation multiples and assessing key value drivers such as recurring revenue and customer concentration.
What’s the quickest way to sell a company?
Selling a business quickly is possible, but speed shouldn’t come at the expense of value or deal security Read more…
What’s the best way to sell a business online?
Yes, you absolutely can sell a business online. Many platforms specialise in connecting business sellers with buyers. Read more…