Deciding Why, When and How To Sell Your Business – Before You Speak to a Business Broker


At some point every business owner will need to exit.

Some wish to spend more time with loved ones, focus on a new venture, or just take their foot off the pedal. Other times, people may have health issues, need more capital or believe a strategic partner could take the business to the next level.

The problem is, when it comes time to transition, many business owners lack a clear process to understand their options and achieve the outcome they deserve.

What’s driving your decision to sell your business? 

The foundation for a successful business exit is to take a sincere and honest look at what is driving your decision. Understanding the ‘why’ will help shape the decisions you will make as you move through the sales process.

People sell their business for a variety of reasons. Here are some key triggers that influence the decision:

  • You would like to retire and spend more time with loved ones
  • Your business has become boring to you
  • You’re beginning to feel burnt out
  • You’d like to explore other interests - perhaps it’s a new venture or a complete turnaround in pursuits.
  • You want or need to move to a new geographical location, but your business is tied to your current area.
  • You or a family member are experiencing health issues.
  • You’ve recently gone through a divorce or had a large personal change to your situation
  • Your business isn’t able to provide you with enough money that you need
  • You’re sick of dealing with your business partners
  • Your business requires extra investment and time, which you are unable to commit to
  • All your net worth is invested in the business and you wish to no longer put “all your eggs in one basket”
  • You are struggling with financial problems and debt

Before you commit to taking your business to market, reflect on your current situation and what triggers are driving your decision. Be honest with yourself – if not, you’re more susceptible to making costly mistakes as you progress through the sales process.

Aligning Your Priorities 

Aligning Your Priorities When Selling Your Business

It’s a given that any business owner will want the best possible price for their business. But receiving a high sales price may not be your only priority. Other factors may include the urgency of the sale, the future health of the company, and how the business sale will impact your life going forward.

Here are a few scenarios:

John – Fast sale and immediate departure

John’s wife has recently fallen ill and the prognosis is not good. He is struggling to remain focused on the business and needs extended time away to care for his wife. His motivation is now to have a fast sale and a quick departure so he can shift his focus to what’s most important in his life – to care for his wife who needs him.

However, choosing to leave the business quickly may be of concern to potential buyers who would like John to remain on board and complete a transition while they find their feet. This could lead to a smaller buyer pool.

John may decide to sell to the first qualified buyer that comes along. Due to his circumstances, he may be more willing to accept a modest sale price rather than hold out for a higher offer.

Peter – Longer runway to secure a higher pay-off 

Peter has run his manufacturing business for 15 years. He’s in his mid-50’s and he knows he wants to exit within the next 3-5 years. The business is running smoothly, but as with any business there is room for improvement. Peter understands that this preparation will help him build value and ensure a better transition out.

He’d like to be selective with potential acquirers as it’s important to him that key staff are taken care of and the business moves forward the way he envisioned. With this in mind, he would also consider staying on for a period after the sale as a consultant or part-owner.

These two scenarios show how your motivation impacts both the timing and outcome of a business sale. In the same vein, if an acquirer was to understand the seller’s motivations it may be a key piece of intelligence that would influence how they structure their offer.

What do YOU want to do after you sell your business?

After determining your motivations for selling, it’s time to think about what you want to do after the sale. Don’t worry, you don’t need to have the rest of your life mapped out. Just begin by focusing on the initial 12 months after the transaction.

Can you see yourself staying involved in the business perhaps as a contractor, employee or part owner? Or are you ready to move on to a new chapter of your life?

Sellers will often agree to stay involved with the business to assist during the transition period to the new owner. Generally, this period can last between 3-12 months and is negotiated during the sales process.

To determine how involved you wish to be, ask yourself the following questions:

  • Do you want to walk away after you sell your business?
  • Are you willing to assist the new owner during the transition period after the sale? If so, for how long?
  • Do you still wish to be involved with your business after the sale, at a management level?
  • Do you want to remain involved with your business as a consultant or part-time employee?
  • Is it a priority to receive a full or large payment at the closing of the sale?

During this phase, be sure to talk to your loved ones about their expectations too. Your spouse won't be too happy if they have their bags packed ready for that long awaited holiday, relishing that they finally have their partner back to enjoy life with...only to be horrified that the deal requires their partner to stay on! 

It’s best to be on the same page with your post-sale plans.

What do you want for your BUSINESS after the sale?

You’ve poured your blood, sweat and tears into the business, it’s only natural to want it to succeed into the future.

Your legacy matters.

Ask yourself what you want for your business after the sale is finalised.

Are any of the following things important to you?

  • Your business stays in its current location to reduce any disruption to your clients (and staff)
  • You'd like to sell the business to a key employee, family member, or someone you already know and trust
  • You'd like to sell your business to a key competitor, supplier, or another business (or deliberately not sell to them)

These answers will impact your ‘go to market’ strategy and the profile of buyers you will be putting the business in front of. Be prepared that saying yes to some of these questions may lead to a smaller pool of potential acquirers for your business.

Although, if you’re happy for whomever acquires your business, to take on the challenge on their terms, then perhaps the above questions are not relevant. This approach certainly provides the largest range of potential buyers and flexibility, but it may require a bit of internal compromise with your motivations to sell your business.

If you are unsure of your motivations, or aren’t quite sure how you’d like to proceed, it’s always worth talking to an exit advisor. They are on hand to present different scenarios to you that you may not have thought about.

Making these decisions now may seem difficult. But they will pay dividends when it comes to proceeding down the sales process. You will come to the negotiations with a sense of confidence, and that confidence will lessen the road bumps that are inevitable in a business sale.

The Key Takeaway

It is important to know your why when you start a business, and it’s just as important to be clear on your why when it comes time to exiting.

“He who has a why can endure any how.” -- Friedrich Nietzsche

The key takeaway is clarity - be crystal clear on your drivers for selling and look at their implications across key areas in a business sale transaction. These drivers will impact everything from your desired sales price, timeline to sell, level of involvement and your legacy post-exit.

Take some time to review our checklist, consider the triggers for selling and the outcomes which are important to you. Once you have established your ‘why’, you will be in the driver's seat to start shaping your own strategy.

Think about these factors before you speak to a broker or an exit advisor, as it can be really empowering as a personal exercise. When it comes time to speak to an expert, you will have a solid foundation for which direction you’d like to take, and they will supplement your decision with a wealth of experience from guiding many other deals over the line. They can build on your personal desires and create a targeted exit strategy which aligns with your selling objectives.


We weren’t born to business.

We were born to live life.

Your business should be a vehicle for helping you achieve your personal goals in life.

At Exit Advisory Group, we help entrepreneurs develop growth and exit strategies to maximise their wealth and provide options.

We do this by giving business owners the tools and strategies to design more profitable, efficient and enjoyable businesses to own - that are also less dependent on them. When they choose to exit, they are in the best position to unlock the wealth in their business and be rewarded for their hard work.

If you would like to know more about how we help business owners like you, feel free to get in touch:

1300 133 540

Exit Planning | Maximising Company Value | Business Sales

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