How long does it take to sell a business? It typically takes around 6-9 months to sell a business.
However, the process may vary based on industry and the current state of your business. Regardless of the type of business you operate, the process of selling a business can be a confusing, muddled process.
Many business owners do not know where to begin and find themselves asking, “What are the steps to selling a company? Where do I even begin?” Our business brokers have established a timeline to help you determine how long does it take to sell a business.
How long does it take to sell a business?
A Full 6-9 Month Timeline
Decide to Sell Your Business and Sign Listing Agreement
Duration: 15 days
Day 30
Organize Marketing Materials and Prepare to List Your Business For Sale
Duration: 30 days
Day 60
- There are several marketing materials required to sell a business. A one-page summary (teaser), a detailed Confidential Informational Memorandum (CIM), and a virtual data room need to be prepared, housing all the documents required during due diligence. In addition, a detailed listing plan needs to be developed with timelines of how the business will be marketed to owner/operators, strategic and financial buyers.
Listing Process – Find, Qualify, and Solicit Indication of Interest (IOI)
Duration: 30 days
Day 90
- Once you have listed your business for sale, there should be a great deal of interest from prospective buyers satisfied by the teaser. Those that are more interested will sign an NDA, then receive the CIM where more detailed questions will be answered. Potential buyers will need to be vetted and qualified. This list will narrow down to a smaller number that will want to have conversations with the seller. At this time, an even smaller group will make offers.
Select Offer, Sign Letter of Intent (LOI) and Due Diligence
Duration: 60 days
Day 150
- After reviewing all offers, you will select the buyer for your business that you believe best meets your objectives and sign an exclusive Letter of Intent (LOI). The LOI will list the specific terms as to how you are selling the business and what exactly the buyer is purchasing. Once agreed to and executed, there will be a list of corporate and business documents the buyer will want to review and fully understand. These will be shared through the data room previously prepared.
Prepare and Review Purchase Agreements to Sell Your Business
Duration: 30 days
Day 180
- The final, definitive agreement between you and the buyer. It includes the terms of the sale of your business, what is or is not included in the sale price, and optional clauses and warranties to protect both the seller and the purchaser after the transaction has been completed.
Set a Closing Date and Close the Sale of Your Business
Duration: 30 days
Day 240
- Agree to post-closing final adjustments based upon prorated expenses, inventory, and accounts receivable valuation. Review and sign all legal documents. Receive buyer’s payment from purchase price based upon payment terms negotiated.
Brentwood Growth can help
Sell YOUR COMPANY OR PREPARe for a salE
Selling a business can be a tough journey.
Brentwood Growth business brokers can provide you with a complimentary business valuation to help you get started and point you in the right direction.
If you want to think through full or partial sale today or how best to set the business up for a sale in years ahead we are here to talk.