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How Long It Takes to Sell a Business and What Slows It Down

Owners nearly always expect a faster sale than they get, and St. Louis Business Brokers Gateway hears the same question first: how long will this take?

Here is the honest answer.

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Quick takeaways

  1. Most sales take seven to nine months from signing with a broker to closing.
  2. Six months is quick, and a sixty day close is an outlier.
  3. Missing paperwork, lease approval and bank timing cause most of the delay.
  4. Keep the company performing until the day you close.

The usual range

Plan on seven to nine months from signing with a broker to closing. Six months counts as fast. A sale that closes in two months is unusual, and some larger deals run a year.

Owners often feel the process drags even when it moves at a normal pace, so set expectations early.

The stages

  1. Preparing the books and a sales document
  2. Marketing quietly and screening buyers
  3. Receiving an offer and signing a letter of intent
  4. Buyer review of your records, with a deposit at risk
  5. Lender approval, lease approval and closing
  6. Handoff to the new owner

What slows it down

Books that do not match tax returns top the list. A buyer who cannot tie statements to returns stops and asks questions, and some walk away.

Landlords can take weeks to approve a new tenant, and a lender may require a lien agreement that attorneys must negotiate. Start both early.

Licenses that do not transfer, such as liquor permits, add their own waiting time.

Buyers who fade

Many buyers who ask for information never sign a nondisclosure agreement, and others cannot show funds. A broker screens in order: nondisclosure first, a short call, a summary, then proof of funds before you give up your time.

Timing within the year

Banks are busiest in the last quarter, so a listing that starts in September rarely closes that year. Owners who race to a year end tax deadline sometimes collapse deals that were not ready.

What you can control

Get your records in order before you list: three years of statements, current books, a clean asset list and a staff roster. Owners who do this save weeks, and buyers trust them more.

Keep performing

A dip makes buyers nervous, and a sudden spike makes them suspicious. Steady results through closing protect your price. Read how buyers pay, then see what your company is worth.

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