My Florida Business Broker

How Long Will It Take For Me to Sell My Small Business?

As a business broker, I always deal with this question: How long will it take for my business to sell? Once owners decide to put their company on the market, they become eager to close the deal and move on to the next phase of their lives. Understandable.

Ask any experienced broker, and they’ll give a standard answer to the question: 6 – 9 months. If you’re the kind of person who’s not satisfied with rule-of-thumb estimates, I can show you the numbers. Business Brokers of Florida provides a database of sales in every industry throughout the state. You can filter the data by sales, Seller Discretionary Earnings (SDE), price, and other factors. The average time to sell in Florida so far in 2023 is 300 days—about eight months. 

Of course, when it comes to the sale of your own business, the numbers are helpful, but they don’t tell the whole story or predict the future. Many factors impact the value and salability of your company; some are out of your control, but you can influence how fast your company sells.

First, what’s out of your control. The market overall, which should come as no surprise. In a recession, when companies are generally not as profitable and buyers are less optimistic, your company may sit on the listings for a while (or go at a discount.) In an inflationary environment, when the cost of debt is rising (where we’ve been for the last year or more), the pool of buyers who can afford a specific business shrinks. They may look for smaller companies since their money doesn’t stretch as far as it once did. In the current environment, I find that sellers willing to hold notes find a bigger pool of buyers than those looking for cash-only deals. For example, even holding a small note with a 2-year standby allows a lender to exclude that amount for debt service, increasing the amount a buyer can finance and helping increase the purchase price.

You also may be competing with your, well, competitors. If there are several options within a market, buyers will compare them and make offers for the most attractive/profitable/scalable company. You may even be competing with companies in different markets; your city or region might just be one of the options a buyer is considering.

But there are plenty of aspects within your control. You can choose to improve any number of factors to make your business more attractive to buyers and sell it faster. Here are some of them.

First, price. An experienced broker can advise you on how to price your company so that it’s competitive in the market. You may hear a lot about how much a business in the same area or the same industry sold for, but only someone with real experience can give you an honest and data-based opinion of value and how competitive you’ll be in the market. Pricing your company too high will mean that some buyers will pass you by for more reasonably priced offerings. 

A broker will be able to create competition for your business, especially if they’re a member of Business Brokers of Florida, which promotes cooperation and co-selling opportunities among its members.

Clean books and records. If you have any discrepancies or issues to resolve in your records, fixing them early is essential to a smooth and quick sale.  Make sure all your tax records and files are in order and ready for the diligence process, and that you’re prepared to respond quickly and efficiently to inquiries from the buyer and his team. Ninety percent of the time, it’s the buyer or seller who slows down the sale, so your response time can make a big difference.

Your business model. Buyers look for companies that have a management team in place and can run smoothly without a significant amount of owner involvement. They are buying cash flow, not a 60-hour work week. If you don’t have a viable structure in place, this is the time to reorganize so you do. 

If your processes and systems are antiquated, buyers may see it as an opportunity to create more efficiency.

 A diverse customer base. No matter how profitable you are, if your business is dependent on just a few large accounts, a buyer may hesitate to invest. They look for diversification to reduce their risk, especially after a change in management.

Scalability and potential. Buyers look for companies that are profitable – and have room for growth. They look for trends over the past few years to see whether there’s some growth potential, both in size and profitability. If your sales have been declining, and you can wait a couple of years to sell, I often advise building the company up so it’s worth more on the market. 

If I can help you understand how to improve the “curb appeal” of your company, I would be happy to give you a complimentary (and confidential) opinion of value

Bianca Evans

Bianca Evans is an experienced business broker based in Jacksonville, Florida. She is a top producer in her field and has made over 200 transactions since 2006. She is a Certified Business Intermediary (CBI), a Certified M&A Professional (CM & AP), a Board Certified Intermediary (BCI), and has her B.S. degree from the University of Florida.

In her 17 years of experience, she has sold businesses in manufacturing, wholesale/distribution, service, retail, restaurants, professional offices, and more.