Sell a business sounds straightforward: you find a buyer, agree on the price and sign the deal. In practice, the process turns out to be more complex and a lot of time is lost. What starts with enthusiasm and momentum can turn into a process that takes months longer than planned.
Why do sales processes get stuck or take longer? And more importantly, what can you do as an entrepreneur to prevent this?
Starting to prepare too late
The most common cause of delay is lack of preparation. Buyers want to understand exactly how your business is doing. Not just in words, but especially in data and reports. Many SMBs think their data and information is in good order, but for a sale it regularly turns out that more is required of the information than the business needs on a day-to-day basis.
When that information is not readily available, delays occur. Documents have to be looked up, figures have to be explained and sometimes even corrected. Every additional question costs time - and energy. In addition, the absence of information can lead to less trust, and reliability in a process is the key to success.
The solution? Start putting your administration, contracts and financial reports in order well before you officially want to sell. A well-prepared business sells better and faster.
Lack of clarity about the story behind the numbers
Numbers don't tell the whole story. Buyers want to understand the story behind the numbers, where the growth is coming from and where the opportunities lie. If your strategy or vision for the future is not clear, doubt arises.
Doubt leads to additional questions. Additional questions lead to delays.
Therefore, make sure you can explain clearly in advance:
- What distinguishes you
- Why customers choose you
- Where future growth should come from
A clear story accelerates trust, and trust accelerates decisions.
The wrong buyers at the table
Not every interested party is automatically the right buyer. Sometimes there is less of a strategic connection than expected. Sometimes financing is lacking. And sometimes the expectations regarding price or division of roles are different.
If you don't discover this until halfway through, you're precious months away.
A targeted selection in advance prevents you from investing time in processes that ultimately founder. Depending on the size of the potential buyer group, you can make choices here, whereby the general rule is: Quality over quantity.
Lack of direction
A sales process without clear planning almost always stalls. When deadlines are missing or questions are always addressed ad hoc, delays occur. A directed process from preparation to completion gives the greatest chance of success.
A tight process means:
- A thorough analysis in advance
- Clear timelines
- Clear agreements about when bids are expected
- A single point of contact within the organization
- Fixed moments for consultation
Structure provides clarity and pace. And clarity and pace keeps energy in the process.
The company runs less well during the process
Perhaps the biggest pitfall: all attention goes to the sale, while day-to-day operations slacken. Disappointing results almost immediately cause the buyer to renegotiate the price or conduct additional research.
A stable or growing business not only sells better, it sells faster. As an entrepreneur, you need to keep the focus on your business and not the sales process.
The most important lesson
A syrupy sales process is largely preventable. In most cases, delays are the result of insufficient preparation, lack of direction, or disappointing results leading to less trust and more control from the buyer.
Entrepreneurs who start structuring early, look realistically at their valuation and work from a clear plan, keep a grip on the process. This not only reduces stress, but often results in better conditions and higher returns.
Anyone who ever wants to sell would therefore be wise to start preparing today.
Because speed in a sales process is not created the moment you sign, but in the period well before.
