How Long Does It Typically Take to Sell a Business?February 24, 2017
What affects the length of selling period?
Selling a business is something that can be difficult to attach an accurate time frame to, and many variables must be taken into consideration in order to estimate how long you could potentially be waiting for a sale. Business type, size, and overall market value all have an effect on the length of the listing period. Pricing of the business is also an important factor to consider, as too high a selling price can turn away many prospective buyers. Furthermore, the type of sale affects the type of buyer, whether you are selling a business entity or simply business assets.
The key is knowing what to expect, which can avoid rushing a sale for a compromised price or holding out for too long and never finding a buyer. In a survey of experienced business brokers, 72% suggested that the majority of owners don’t allow the appropriate time for an effective sale.
What is the appropriate time?
A study by businessesforsale.com suggests that the average listing period can range from five to eight months. Some businesses even sit on the market for over a year before they find a buyer.
This, of course, doesn’t take into consideration the time it takes to prepare a business for sale. Valuation, analyzing of finances and organization of various documentation can add anywhere from weeks to months on top of the listing period of a business. Even ‘pre-sold’ businesses – where a buyer is interested prior to the business being listed – can take months before the sale becomes complete, especially if the buyer requires outside funding.
Who can help?
Working with a business broker can help minimize selling time. They can assist with negotiations and provide unbiased advice based on what is best for you and your business. If you’re in the market for a Dallas business broker, Prodigy Partners is a team of business brokers in Texas that can assess your business and help you through the selling process.