When is the Right Time to Sell Your Business?
Timing the sale of your business can be just as critical as building it. Whether you’ve spent decades growing a company or recently scaled quickly, knowing when to sell is a decision that affects everything—from the price you command to the legacy you leave behind. But how do you know if now is the right time?
There’s no single formula that works for every business owner. However, several factors can help you identify when it might be time to move on—and position your business for the most successful sale possible.
Your Business Is Thriving, Not Just Surviving
One of the biggest misconceptions business owners have is that they should sell when things slow down. In fact, the opposite is often true. Buyers are most interested when your company is profitable, systems are in place, and there’s clear growth potential. If your revenue is strong, your team is steady, and your operations are running smoothly, that’s a great time to sell your business.
Buyers want to purchase future cash flow. If your business is performing well, it shows stability and reduces risk for the buyer—which can lead to a higher valuation and better terms for you.
You’re No Longer Motivated to Grow the Business
Many business owners reach a point where the passion that fueled the business is no longer there. If you find yourself dreading decisions, delaying strategic planning, or simply feeling burned out, it could be a sign that it’s time to move on. A business with a disengaged owner is at risk of declining performance, which can hurt your sale price.
Selling before you hit that wall allows you to hand off the business while it’s still in good shape—and before your lack of motivation begins to show up in the numbers.
Market Conditions Are in Your Favor
Industry trends and economic conditions can influence both buyer interest and your final price. If your sector is consolidating, and larger companies are actively acquiring smaller ones, that’s a window of opportunity. Similarly, when interest rates are low and financing is more accessible, more buyers are on the market.
A business broker can help you analyze the current landscape, assess buyer demand, and determine whether now is an opportune time to list your business.
You Have a Clear Personal or Financial Goal
Some business owners plan their exit around retirement, while others are driven by new opportunities. Maybe you’re looking to invest in a different venture, or perhaps you want to free up time for family. If you’ve reached a personal or financial milestone and are ready for a new chapter, selling your business could be the right next step.
Having a solid financial plan in place—and a team that includes a business broker, CPA, and financial advisor—can help you understand how a sale will affect your long-term goals.
There’s a Transition Plan in Place
The best time to sell is when your business can continue to succeed without you. That means having documented systems, a strong management team, and a plan to transfer knowledge. Buyers want to know that operations won’t fall apart once the current owner steps away.
If you’ve built a business that doesn’t rely solely on you to function, you’ve added value—and removed a major objection buyers often have.
How Does a Business Broker Get a Better Price for My Business?
If you’re selling your business (or even just considering it), you might have heard people tell you to work with a business broker. You also might understandably hesitate — why hire someone and pay a commission when you could just sell your business yourself?
You may not realize that a good business broker can often get you a better price for your business. Even when you factor in the broker’s commission, you still end up with a larger profit than you would if you sold your business yourself.
How can a business broker convince a buyer to pay so much more? Here’s a closer look.
They Can Accurately Value Your Business
A business valuation calculator can give you a quick idea of what your business may be worth. However, when it comes to selling, you want your valuation to be as detailed and accurate as possible.
If you set the price too low, you could miss out on thousands. But if you set it too high, you’ll waste time marketing it before you realize you’ll need to drop the price.
Business brokers are experts at valuing businesses. They’re also attuned to market trends and know what features of a business may make it worth paying a premium for.
They Have Access to a Pool of Buyers
Business brokers will usually maintain a list of people who are actively looking to purchase businesses. More potential buyers generate more competition, and that puts you in a place to possibly receive offers above the asking price.
They’re Expert Negotiators
In virtually every case, selling a business involves negotiating the price, the terms and conditions of the sale, or both. If you aren’t experienced when it comes to negotiating the sale of a business, you might find this step hard to navigate. There’s also a very real possibility that you’ll lose money by agreeing to unreasonable terms.
When you work with a business broker, you’ll have an advocate during this critical process. Your business broker can handle negotiations for you while representing your best interests.
They Keep Everything Confidential
If you sell your business on your own, it’s nearly impossible to avoid the word getting out. If this happens, your employees may quit because they’re worried their jobs are in jeopardy. Your existing client base may be tempted to go elsewhere, and some of your trade secrets may be revealed.
Business brokers are experts at maintaining confidentiality throughout the sales process. When you work with one, you can avoid arousing suspicion — and all the complications that come with it.
Should You Hire a Business Broker?
Choosing whether you should work with a business broker is just one of the many decisions you’ll make as a part of selling your business. It’s not a decision you should make lightly — it’s a choice that can dramatically affect your business’s final sale price.
Ultimately, unless you already have extensive experience selling businesses, working with a broker makes the process easier and is also likely to get you the greatest profit.
Understanding Your Business Is Critical for Business Brokers
Are you selling your business? You likely already know that hiring a business broker can make the difference between a good sale and a great one. However, you shouldn’t hire just any business broker. If you want to get the best sale price possible, it’s imperative that business brokers understand your business. Here’s why.
They Can Get an Accurate Valuation
Easy online valuation calculators can give you a general idea of your business’s worth. But if you want to get a great sale price, you need a highly specific, accurate valuation. Valuing a business is an art, and it takes a skilled business broker to do it. If a business broker doesn’t have a deep understanding of your business and how it works, it will be impossible for them to get the most accurate valuation possible.
They Can Grasp the Value of Intangibles
Profit margins and your balance sheet aren’t the only things that influence your business’s sale price and how a broker markets it. There are many so-called “intangible” factors that you can’t attach a monetary value to — but they still make a difference in the overall worth of your business. Here are some examples:
Customer loyalty
Brand recognition
Goodwill between your business and others
Copyrights or patents
Intangibles can lure in potential buyers, so business brokers should have a solid understanding of the intangibles of your business.
They Have a Feel for Which Buyers Might Be Interested
A good business broker makes it their mission to understand your business, and they take time to understand what buyers want. Selling a business isn’t like selling a car. Buyers usually don’t contact business brokers out of the blue in response to an ad. Instead, brokers maintain a network of interested buyers.
When they understand both your business and their potential buyers, they can nudge promising buyers toward your business and increase your chances of a fast, profitable sale.
They Can Be Unbiased
You know your business better than anyone. However, for business owners — and especially owner-operators — emotions often get in the way, at least to some extent. Even if you think you’re being perfectly objective, there’s a good chance that your emotions are influencing you on a subconscious level.
That’s a natural reaction when you’re selling something that has long been a major part of your life. However, to negotiate a deal effectively, you need someone with an objective view of your business. When a broker takes the time to understand your business and combines that understanding with objectivity, you’ll be well on your way to a successful sale.
Take the Time to Choose the Right Broker
Selling a business is a complex venture, and in virtually every case, it’s beneficial to have a broker. Don’t rush your selection process! Choosing a broker who’s willing to really get to know your business is essential, and it takes a skilled and motivated broker to do that well. With a quality broker by your side, you dramatically increase your chances of a deal that suits you.