We were recently asked a simple but important question by a business owner: “What questions should I be asking in preparation for the sale of my business?”
Some business owners are very prepared, others are just starting the process. We recommend starting with a self-assessment. Below is a practical exercise to help you evaluate your readiness.
Give yourself a score from 1 (not at all) to 10 (fully confident) for each of the following statements:
Business Sale Readiness Checklist
- I know the current market value of my company.
- I understand the key value drivers in my industry and what investors are looking for in premium businesses.
- I follow M&A trends in my sector and have a clear sense of the most likely 10–20 potential buyers.
- I understand what goes into Adjusted EBITDA and track it regularly.
- I understand the difference between valuation and net sale proceeds, including the impact of taxes, debt, working capital, and transaction fees.
- I understand how changes in working capital can affect the final proceeds – both positively and negatively.
- I understand the full process of selling a business, including timeline and key steps.
- I understand the role of an investment banker, how they are compensated, and the value proposition.
- I am prepared for buyer diligence, including a detailed review of financials, contracts, and operations by external advisors.
- If given 1–5 years to prepare, I know exactly what actions I would take to maximize value and minimize taxes.
What Your Score Means
This exercise is not about perfection, it’s about awareness.
If you find gaps in your answers, reach out and we’d be happy to talk about helping you.
The most successful outcomes in a business sale are rarely the result of timing alone. They are the result of preparation, clarity, and thoughtful positioning well in advance of going to market.
Live in the PNW and want to take the first step? Please reach out to John or Ed for a confidential conversation.
