A typical business sale can take anywhere from six to twelve months, although some transactions complete more quickly and others can take considerably longer.
There is no fixed timetable. The size and complexity of the business, how prepared you are, the type of buyer and the time required for due diligence and legal negotiations can all affect how long a sale takes.
If you’re considering selling, it is sensible to think in months rather than weeks.
What does the business sale timeline look like?
A straightforward sale might look something like this:
Preparing for sale: 2 to 6 weeks
Getting financial information and documents in order, considering valuation and preparing the information needed to present the business to buyers.
Finding and speaking to buyers: 1 to 4 months
Marketing the opportunity, identifying potential buyers, managing enquiries and holding initial discussions.
This stage can be much quicker if there is already an interested buyer, or longer if the business requires a very specific type of acquirer.
Offers and Heads of Terms: 2 to 6 weeks
Once serious buyers have emerged, they may make indicative offers. A preferred buyer is then selected and the main commercial terms of the proposed transaction are agreed.
Due diligence: 4 to 12 weeks
The buyer will usually review the financial, commercial, legal, tax and operational aspects of the business.
The more organised your information is, the easier this stage tends to be.
Legal documentation and completion: 4 to 8 weeks
The lawyers negotiate the final sale documents, any remaining issues are resolved and the transaction moves towards completion.
These stages can overlap, so adding each timeframe together does not necessarily give the total transaction length.
What can slow down a business sale?
Some delays are unavoidable, but common causes include:
- incomplete or unclear financial information
- difficulty producing documents requested during due diligence
- unexpected legal or tax issues
- negotiations around valuation or deal structure
- buyer financing taking longer than expected
- property or regulatory matters
- significant issues being identified during due diligence
- the buyer or seller taking too long to make decisions
A transaction can also lose momentum if the business starts underperforming while the sale is taking place.
This is why continuing to run the business properly throughout the process is so important.
Can you sell a business quickly?
Yes, particularly where there is already a credible buyer, the business is well prepared and the transaction is relatively straightforward.
But speed shouldn’t necessarily be the main objective.
Taking time to approach the right buyers and create competition can produce a very different outcome from accepting the first credible offer.
For most owners, the aim should be to run an efficient process rather than simply the fastest one.
When should you start preparing?
Ideally, well before you want the transaction to complete.
If you know you would like to have sold the business within the next 12 months, it makes sense to start preparing now.
Getting your financial information, contracts and other key documents organised before buyers start asking for them can save significant time later.
It also gives you an opportunity to identify potential issues before they become part of a buyer’s due diligence.
Thinking about selling?
You don’t need to wait until you’re ready to formally put your business up for sale.
The Brokerage connects business owners with potential buyers and investors, allowing you to explore the market and control the information you disclose.