A lot of businesses that go up for sale never actually sell, and three mistakes keep most of them stuck: a price based on gut feel instead of provable profit, a business that can't run without its owner, and books that aren't ready when a buyer asks. The good news is that all three are fixable. They just take time.
None of these is a market problem. Each one is something the owner controls.
Pricing off your gut instead of the market
Buyers and their banks go off the profit you can actually prove. Most buyers plan to use an SBA loan, and according to BizBuySell, SBA lenders typically underwrite from tax returns. So if your asking price doesn't match what your tax returns support, the bank usually won't finance the difference, and most buyers can't cover it on their own.
An overpriced listing doesn't just sit. It gets stale. Buyers see it on the market month after month and start to wonder what is wrong with it, which makes the eventual price cut look like weakness instead of realism. Pricing from verified profit and a multiple that fits your size, industry and trend is how you avoid that trap.
A business that can't run without you
If every customer and every decision goes through you, a buyer isn't really buying a company. They're buying a job. And people don't pay a company's price for a job.
Buyers call this owner dependence, and BizBuySell notes that high owner dependency can negatively impact a successful business's value. The fix is to move relationships, knowledge and decisions to your team, one piece at a time, well before you list. A simple way to find where to start: picture yourself gone for 30 days and notice what breaks first.
Books that aren't ready
A buyer and their bank are going to ask for about three years of tax returns and financial statements. If it takes you weeks to pull that together, they start to get nervous, and a nervous buyer either slows down, digs deeper or walks away.
Ready books mean your returns, profit and loss statements and balance sheets for those years are complete, consistent with each other and easy to hand over. Personal expenses are cleaned out or documented, and anything unusual has a clear explanation. If your bookkeeping is behind today, catching it up is the first step. Then ask your CPA to pull the last three years of returns and statements into one folder so you can see exactly what a buyer will see. That preparation does more for a smooth sale than almost anything else you can do in the final year.
Start before you list
None of these fixes happen overnight. Rebuilding a price expectation, handing off responsibilities and cleaning up three years of records all take time, which is why the best moment to start is well before you plan to sell. Which one sounds like your business? If you want an honest read on where your number should be, request a confidential business valuation.
Ready to talk it through? Talk with me about selling. No cost, no obligation.
Read the transcript
A lot of businesses that go up for sale never actually sell. Here are three mistakes that keep them stuck.
The first mistake is pricing your business off your gut instead of the market. Buyers and their banks go off the profit you can actually prove. So if your number doesn't match your tax returns, the bank usually won't finance the difference.
The second is a business that can't run without you. If every customer and every decision goes through you, the buyer really isn't buying a company. They're buying a job.
And the third is when your books aren't ready. A buyer and their bank are going to ask you for about three years of tax returns and financials. If it takes you weeks to pull that together, they start to get nervous.
The good news is all three are fixable. They just take time. So start well before you list.
So which one sounds like your business? Let me know in the comments.
