Published 11 October 2016. Updated 11 August 2026.
When it comes to selling a business, there are definitely many things to consider and heaps of things you need to do. In fact, I’d go so far as to say that selling a business is often harder than selling a house and for some that can be quite difficult.
Here are my tips (I’ve sold one myself successfully and I’m an experienced business coach) on what to think about, what to do and things to consider before and during.
Why are you selling?
If you’re ‘over’ your business, it’s making you no money and is just a pain in the derriere, then think about why someone would pay good money for it? That old expression of ‘one man’s trash is another man’s treasure’ rarely will track when it comes to business. However, if it’s making great money and is working well, and it’s part of your plan, or perhaps leading to retirement, then that’s a different story. People have many different reasons to sell … but please don’t make the decision on a whim after a particularly hard day. Selling a business isn’t a quick 5-minute exercise.
Timing the sale.
This isn’t just an economic timing issue, where you want to sell when the economy is good and people are more likely to buy a business, but also think about your timing and that of the business and its success. If you don’t have 3 years of great financials (or at the very least, clearly improving financials), then it’s hard. If you have 2 great years and last year was lousy, unless you’ve got an incredibly good reason …. Explaining that one to the buyer (and their accountant) might not work.
Tie up loose ends.
This can be a whole number of things; it might be renewing your lease, or getting your Facebook business page back, or sorting out a critical computer problem with your booking software … whatever it is, get the messes sorted out before even going down this path. No-one wants to buy a heap of problems.
Pricing the business and using a broker.
I’m a big fan of using Business Brokers as this is what they do, every single day. Get one who is experienced and it will make a big difference to the success of your sale. It’s a good idea to get the business valued as well. Just like property, if you overprice it you will miss out on people who might have been willing to buy, or underprice and you miss out too. Unless you’re selling to an employee or family member, then brokers know how to make it happen and buyers know the sale is serious because you’re investing in a broker and things will occur in a professional way.
Confidential Information Memorandum (CIM).
This is basically your proposal. A broker will prepare this for you, BUT you know your business better than anyone, so get going on listing all its pros, benefits and assets. Remember, assets can be social media handles and other intangible assets; not just furniture, plants, or vehicles. Put your sales hat on and list all the reasons your business would be great for someone to buy. Chances are you’ll come up with something the broker didn’t think of.
Clean up your financials.
Part of your preparation will be organising your financials, so just like the above, tie up loose ends, get into your Xero or MYOB and ensure everything is clean. If you’ve got a bit of money owing to you, then get onto debt collecting (which you should be doing anyway) and clean up those debts. If there are bills showing in the business you need to pay, then pay them, or if they are not owing, then clear out. Has the latest (or fairly recent) tax return/s been lodged? Besides it being illegal, you should not be keeping a ‘second set of books’ or ‘taking cash’. That’s tax avoidance, but also if you’re selling, no serious buyer is going to believe income is higher, but you just don’t bank it. Of course, none of you do the ’dodgy’ but think it still needs to be pointed out.
Leading up to selling, work and work hard.
Now is not the time to slack off, switch off or allow things to wind down. Sometimes a business owner, who is wanting to head to retirement, will start cutting jobs, reducing days or ‘winding down’ but then wants to sell. You need to keep things going and work hard leading up to the sale, not slack off. Just think about those extra dollars you’re more likely to get with a quality business that hasn’t been run down.
Do not tell your clients or your team!
In this instance, honesty is not the best policy. If clients know you’re going, they may begin looking for a new supplier/service provider. Staff may become nervous and start shopping around for a new job, as there are often no guarantees their job will be safe. Tell both parties after the sale, and in the right way … so neither side feels uncomfortable. Some sales are contingent on a percentage of staff or customers staying, so don’t jeopardise things before you even start.
Spruce up the joint.
If you’re in premises, now is a great time for a spruce-up. Sometimes as little as a coat of paint is all you need. Clean up, declutter and clean. If the boardroom chairs are torn, then replace them, even if just with good second-hand chairs. If vehicles are included in the sale, have them cleaned (inside and out) and even detailed.
Spruce up your marketing and online profiles.
Check your profiles, Facebook, Instagram and even your website to ensure everything is current, fresh and looking good. Have you responded to all the great Google reviews you’ve got? Remember also, if you were a huge part of the business, now might be a great time to tone that down on your website. When I sold my prior business, at its peak I had 25 staff and many of them were on my website under ‘Meet the Team’. I moved myself down to the bottom of the list and, where relevant, removed ‘Donna’ does this, or even culled some of the reviews off the site which specifically mentioned me. Now is not the time to have an ego. The buyer needs to feel that they can take over and won’t lose all your delighted clients because you’ve left.
Qualify buyers and answer questions.
Hopefully, you’ve got a broker who will act as your intermediary, and you can seek advice on responses – being positive whilst remaining honest. Plus, the broker will ensure the person is genuine and not just a competitor fishing for info.
What’s the plan for afterwards?
Have a plan for what you will do. It might be that you plan to go into another (non-competing business) or perhaps you’re going to buy a caravan and retire as a ‘grey nomad’. Have an idea in mind and be sure to read all the fine print in the contracts. In my case, the new buyer wanted to ban me from using the word Stone in any business name. The thing was that my books were Stepping Stones and my name was Donna Stone … so I said no to the banning of my name, but yes to the use of the other word. I think I might have even mentioned that my ex didn’t get the name in the divorce; I was definitely holding on to it. Hence, I was able to have the name Stone Business Coaching.
Also give some thought to what you will do with the money. Talk to your Accountant or Financial advisor. Will you pay off a home loan, or buy a caravan, or put a chunk into super, buy another business or something else? I just ask please that you have a plan and don’t just let it gradually but surely dwindle away. You put all that work into building up your business; don’t let the proceeds of your efforts diminish to nothing.
When it comes to business, I’m an exceedingly experienced business coach who has now been coaching for 18 years. If you need help at any stage of your business, whether it’s getting started, growing or prepping for an exit, reach out to me. I frequently offer a free ½ hour sample coaching session, which includes a business analysis, so you can see exactly what I do, and how I do it. CLICK HERE TO LEARN MORE.
