How to Sell Your Business: A Practical Starting Point

Get your business ready before you approach buyers

Gather at least several years of financial statements and tax returns, current year-to-date results, a list of major assets, lease terms, and an overview of your team and key customers. Buyers will try to reconcile the story you tell with these records. Missing or inconsistent numbers slow diligence and can change the terms of an offer.

Make a separate list of one-time expenses, owner compensation, personal expenses paid through the business, and unusual revenue. Do not assume every adjustment will be accepted: each proposed add-back should have documentation and a clear explanation.

Review cash tied up in inventory and receivables, the condition of major equipment, and property or lease obligations before marketing the business. These details can affect what transfers, the cash a buyer needs, and the structure of an offer.

• Check whether customer concentration, key employees, or a short lease create risks a buyer will price in.
• Document how leads arrive, how work is delivered, and what the owner does day to day.
• Resolve obvious recordkeeping gaps before a buyer requests diligence.

Understand value before setting an asking price

A preliminary business valuation can give you a working range, not a guaranteed sale price. Smaller owner-operated businesses are often discussed in terms of seller's discretionary earnings (SDE); larger operations may be assessed using EBITDA. The earnings measure, the quality of those earnings, and the level of owner involvement all matter.

An asking price should also reflect recent comparable transactions when available, the assets and liabilities included, growth prospects, and the likely deal structure. A price unsupported by records may attract attention without producing a closeable offer.

• Start with a preliminary estimate, then review the assumptions with a qualified advisor.
• Clarify whether real estate, inventory, cash, debt, and working capital are part of the proposed deal.

Protect confidentiality while finding the right buyer

A sale process typically begins with a high-level description rather than publishing sensitive customer names, financial details, or your plans to employees and competitors. Qualified buyers can receive more information in stages under appropriate confidentiality protections.

Ask prospective buyers about financing, relevant operating experience, and timing. The highest number on a letter of intent is not necessarily the strongest offer if the financing, contingencies, or transition terms are unlikely to work.

• Decide what can be shared publicly and what requires screening and a confidentiality agreement.
• Compare offers on price, cash at closing, seller financing, contingencies, and your post-sale role.

Why work with a broker while you run the business?

You can sell a business yourself, but doing so can become a second job for months: preparing materials, responding to inquiries, qualifying buyers, arranging meetings, comparing offers, and coordinating financing and diligence. Meanwhile, customers and employees still need you. Buyers will keep looking at the company's results until closing, so letting performance slip can affect confidence, financing, and deal terms.

A business broker can manage confidential outreach, screen prospective buyers, organize information requests, keep conversations moving, and help you weigh the whole offer rather than just the headline price. Thomas brings financial and ownership experience to that work and can coordinate with your attorney, accountant, and other specialists. You remain in charge of the decisions and the business; the broker helps give you room to keep it strong.

• Protect your time so the business continues to serve customers and perform through closing.
• Share sensitive information in stages with buyers who have been screened.
• Keep the transaction moving without replacing your legal or tax advisors.

Plan for diligence, negotiation, and the handoff

After a letter of intent, the buyer may review accounting detail, contracts, licenses, employment matters, and the condition of assets. Have your accountant and attorney review tax consequences, purchase agreement terms, and obligations that continue after closing. A business broker or M&A advisor can help coordinate the process, but legal and tax advice should come from the right professionals.

Think through employee communication, customer continuity, training, and how long you are willing to support the buyer. Preparing those answers early gives you more control over both the sale and the life you want afterward.

Common questions