Why Preparation Changes Everything
Businesses that go to market unprepared tend to attract lower offers, face more due diligence delays, and experience higher rates of deal failure. Buyers — and their advisors — are skilled at identifying weakness, and a single red flag can cost you six figures or kill a deal entirely.
On the other hand, sellers who invest time in preparation consistently achieve higher valuations, faster closings, and better deal terms. Think of it as presenting the best, most accurate version of your business to the market.
The Ideal Prep Window
We recommend beginning preparation 12–24 months before your target listing date. This gives you time to clean up financials, address operational issues, reduce owner dependence, and allow positive trends to show in your numbers before buyers review them.
Get Your Financials in Order
- Compile 3 years of profit & loss statements, balance sheets, and tax returns
- Ensure your books are maintained by a professional bookkeeper or CPA
- Prepare an "add-back" schedule documenting owner perks and non-recurring expenses
- Separate personal expenses from business expenses clearly
- Document any one-time or unusual expenses that distort profitability
- Produce current-year YTD financials and compare them to prior periods
- Resolve any outstanding tax liabilities, audits, or discrepancies
- Ensure all revenue is fully documented — cash sales included
Strengthen Operations
- Document all key processes and standard operating procedures (SOPs)
- Ensure the business can run smoothly without your daily involvement
- Cross-train employees so no single person (including you) is a single point of failure
- Review and renew any expiring leases, licenses, or vendor contracts
- Address deferred maintenance on equipment, facilities, or technology
- Secure key employee agreements and non-competes where appropriate
- Update employee handbooks, org charts, and job descriptions
- Ensure all required business licenses and permits are current
Legal & Administrative Readiness
- Locate and organize your corporate formation documents and ownership records
- Compile all customer contracts, supplier agreements, and leases
- Identify and protect any intellectual property — trademarks, patents, trade secrets
- Resolve any outstanding litigation, disputes, or liens
- Review lease terms and assignability with your landlord if applicable
- Ensure shareholder or partnership agreements are current and reflect actual ownership
- Consult with a CPA about deal structure and tax implications before listing
Personal Readiness
- Define your personal financial goals — what do you need from the sale?
- Clarify your timeline — when do you want to exit, and is there flexibility?
- Decide how involved you're willing to be post-sale (transition period)
- Discuss the sale with your financial advisor and estate planner
- Consider whether you'd accept seller financing or earnout arrangements
- Prepare yourself emotionally — selling a business you've built is significant
Not Sure Where to Start?
We'll walk you through a complimentary readiness assessment and tell you exactly what to focus on first.