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What do I need to do to sell my business?

What do I need to do to sell my business

What do I need to do to sell my business?

Selling your business is one of the most important financial decisions you will ever make. Whether you’re looking to retire, pursue new ventures, or simply cash out, careful planning and execution are key to a successful sale. This guide covers everything you need to do—step by step—to prepare, market, negotiate, and finalise the sale of your business, in approximately 1500 words.

1. Understand Why You’re Selling

The first and most important step is to clarify your reasons for selling. Common motivations include:

  • Retirement

  • Burnout

  • Pursuit of new opportunities

  • Health issues

  • Financial reasons

Your motivation will influence your timing, negotiation strategy, and even the type of buyer you attract. Understanding your “why” will help guide the entire process.

2. Plan Ahead (Ideally 1–2 Years in Advance)

Planning early gives you time to improve the value and attractiveness of your business. This includes:

  • Cleaning up your financial records

  • Streamlining operations

  • Enhancing customer relationships

  • Locking in long-term contracts

  • Reducing reliance on you as the owner

A business that operates well without your daily involvement is far more attractive to buyers.

3. Get a Business Valuation

Before you list your business, you need to understand what it’s worth. There are several methods for valuation, including:

  • Asset-based valuation: For businesses with significant tangible assets

  • Earnings multiplier: Often EBITDA multiplied by an industry standard

  • Comparable sales: Based on recent sales of similar businesses

A professional valuation from a certified business valuer or accountant will give you a credible price point and help justify your asking price.

4. Prepare Financial and Legal Documents

Buyers will want to conduct due diligence before making an offer. Be prepared by assembling the following:

  • Last 3 years of financial statements (P&L, balance sheet, cash flow)

  • Tax returns

  • Lease agreements

  • Customer and supplier contracts

  • Employee agreements

  • Intellectual property and licences

  • Inventory lists

  • Equipment records

  • Any outstanding liabilities or legal issues

Ensure your books are up to date and accurate. Clean, professional documentation builds trust and speeds up the sale process.

5. Improve Business Value Where Possible

To maximise your sale price, consider these value-boosting steps:

  • Cut unnecessary costs to increase profitability

  • Delegate daily operations to your staff

  • Diversify your customer base

  • Invest in systems and automation

  • Resolve any outstanding disputes or compliance issues

  • Improve online presence and digital marketing

Even small improvements can significantly increase your business’s value and attractiveness.

6. Assemble Your Exit Team

Selling a business is complex. Surround yourself with a team of experts, including:

  • Business broker or M&A advisor: Helps with valuation, marketing, and negotiations

  • Accountant: Prepares financials, advises on tax implications

  • Solicitor: Reviews contracts, handles legal issues

  • Financial planner: Helps you plan post-sale wealth management

Your team ensures that the sale process is compliant, efficient, and aligned with your financial goals.

Choose the Right Time to Sell

7. Choose the Right Time to Sell

Timing can have a major impact on your sale price. Ideally, sell when:

  • The business is growing or stable

  • The industry is healthy

  • The economy is favourable

  • You’ve recently had a strong financial year

Don’t wait until you’re burned out or the business is struggling—buyers will spot the red flags and offer less (if they offer at all).

8. Market the Business Confidentially

With the help of a broker or advisor, create a detailed Information Memorandum (IM) that outlines:

  • Business overview

  • Key financials

  • Growth opportunities

  • Customer base

  • Operations

  • Management team

  • Assets included in the sale

Confidential marketing strategies may include:

  • Advertising on business-for-sale platforms

  • Reaching out to strategic buyers or competitors

  • Using your broker’s buyer database

Confidentiality is critical—you don’t want staff, customers, or competitors finding out prematurely.

9. Qualify Prospective Buyers

Not all enquiries will be serious or capable. Vet buyers by:

  • Requiring them to sign a Non-Disclosure Agreement (NDA)

  • Asking for proof of funds or pre-approval

  • Learning about their experience and motivations

  • Understanding their timeline for purchasing

This step saves time and avoids the risk of sensitive information getting into the wrong hands.

10. Negotiate the Sale

Negotiation involves more than just price. Key terms include:

  • Payment structure (upfront, instalments, earn-outs)

  • Transition period (how long you’ll stay to assist)

  • Assets and inventory included

  • Treatment of staff

  • Lease assignment or transfer

  • Non-compete clauses

Be flexible but firm. Remember: the best deal is one that’s fair and sustainable for both parties.

11. Conduct Due Diligence

Once you’ve agreed on terms, the buyer will begin due diligence. This is an in-depth review of your business, including:

  • Finances

  • Legal compliance

  • Contracts

  • Tax history

  • Customer and supplier relationships

  • Intellectual property

Your job is to cooperate, respond promptly, and provide full disclosure. If issues arise, be honest and transparent.

12. Finalise the Sale

Once due diligence is complete, your solicitor will help draft and review:

  • Sale of Business Agreement

  • Asset or share transfer agreements

  • Lease assignment documents

  • Restraint of trade or non-compete agreements

  • Handover plans

At this stage, both parties sign the necessary documents, and the agreed payment is made (either in full or as per the contract).

13. Handover and Transition

The transition period is critical for maintaining business continuity. During this time:

  • Introduce the buyer to key staff, customers, and suppliers

  • Provide training on systems and operations

  • Stay available for questions or guidance

A smooth transition increases the likelihood of long-term success for the buyer and protects your legacy.

Plan Your Life After the Sale

14. Plan Your Life After the Sale

After the deal closes, you’ll face a new set of decisions:

  • How to manage the funds from the sale (invest, retire, start a new venture)

  • What to do with your time (travel, family, hobbies, philanthropy)

  • Tax obligations (capital gains tax, GST implications, etc.)

Work with a financial advisor to make the most of your post-sale position and avoid unnecessary tax bills.

15. Common Pitfalls to Avoid

  • Overpricing the business: Scare away serious buyers

  • Lack of preparation: Creates delays and distrust

  • Not delegating to professionals: Leads to costly mistakes

  • Selling at the wrong time: Can reduce your sale price significantly

  • Ignoring tax implications: Can result in unexpected liabilities

  • Failing to plan your next move: Leaves you financially or emotionally unprepared

Conclusion

Selling a business is a major milestone that requires careful planning, patience, and professional support. By preparing early, presenting your business professionally, and choosing the right time and team, you can achieve a successful and profitable exit.

Take control of the process and treat the sale like a business project. When done right, selling your business can unlock new opportunities and reward you for years of hard work.

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If you’d like, I can help you draft an Information Memorandum, assess your business value, or find the right broker to represent your sale. Just let me know.

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