HOW LONG IT TAKES TO SELL A BUSINESS

HOW LONG IT TAKES TO SELL A BUSINESS

Owners thinking of selling a company often want to know how long the process will take.

The answer is: The length of time it takes to sell a company varies. It depends on a several factors. A couple of them are the size of the business and type of business.


Keep in mind that no two companies are exactly alike, even if they are in the same geographic area or in the same industry. Plus, other factors can also affect the length of time it takes to sell.

Smaller businesses can sell fairly quickly... usually within four to six months. Larger companies can take much longer. Sometimes it takes eight to 12 months to find the right buyer. Then more time is needed to negotiate the best deal. Businesses with specific issues, problems or challenges may take as long as 18 months or more to sell.

Of course, if the company is priced too high, or is not professionally packaged, and valued using an independent third-party appraisal, it may never sell.

Businesses are not like residential real estate, where there might be several choices of the same kind of house in the same geographic area. There is only ONE company like yours!

Plus, there is really no active market where closely held businesses are traded. It is not like owning stock in a public company like WalMart or Microsoft, where you simply call your broker... or click a button on your computer screen and sell your stock. Yours is a privately owned business. A market for it needs to be created from scratch.

Several factors drive the process, such as
- price
- location
- type of business
- owner's compensation
- down payment
- financing
- terms and conditions
- and, of course, the actual availability of buyers

The time for selling a business varies from four months to 18 months or more. The size of the transaction, the pricing structure, and the marketing strategy will directly affect how long it will take to sell your company.