How to Sell a Business: The Owner's Order of Work, From Two Years Out to Completion

Selling a business well starts about two years before you want the money. The price is set by what the business earns without you, how safe that profit looks to a buyer, and how clean the numbers are, and all three take time to fix. The deal itself, from finding a buyer to completion, is the last six to nine months. Most owners do it the other way round, and sell a job instead of an asset.

This is for owners of established businesses who are thinking about selling in the next one to five years and want the order of work, not a broker’s pitch. I own and invest in businesses, I’ve sat on more than 20 boards, and I’ve seen deals from both sides of the table. Your accountant and solicitor handle the transaction. This is the part before it, which is where the money is made or lost.

What a buyer is actually paying for

Not your turnover, not your brand, not your years of hard work. A buyer pays for profit that will still be there after you’ve gone, multiplied by how much they trust it.

Price ≈ adjusted EBITDA × a multiple

Adjusted EBITDA is what the business earns with a market-rate person doing your job instead of you (what is EBITDA explains it). The multiple is the price of trust: size, recurring revenue, how spread the customers are, how good the management team is, and whether the owner is needed. Small UK businesses change hands at low single-digit multiples; the gap between a business that grows without its owner and one that doesn’t can be a whole point or more, and every point is a year’s profit. The business valuation calculator shows you what that gap is worth in your case.

In my words, from the podcast: if the business doesn’t work without you, you’ll be tied in for three, four, five years after the sale to prove it can. If it does work without you, you get a lot more money for it, because you’re selling an asset, not the job you’ve built.

Two years out: build the thing worth buying

1. Make it grow without you. A managing director or general manager, a senior team with their own numbers, decisions made and written down without you in the room. Take three weeks off with the phone off and see what breaks. Then fix that. This is the single biggest lever on the price. High-performing teams is where to start.
2. Normalise your pay. Pay yourself a market salary through the P&L so the accounts show the true profit with your job costed in. It removes the biggest argument in every negotiation.
3. Clean the numbers. Monthly management accounts, reconciled, with margin by product or service. Three years of accounts a buyer’s accountant can follow without questions.
4. Spread the risk. No customer over 20% of revenue if you can help it. Contracts in writing. Supplier terms in writing. Leases with enough time left.
5. Get the paperwork straight. Shareholder agreements, employment contracts, intellectual property in the company’s name, no undocumented loans between you and the company. Due diligence finds all of it, and every finding knocks the price or delays the deal.
6. Stop the one-offs. Personal costs through the business, family on the payroll, the car. Every one is a line a buyer’s adviser will use.

One year out: know the number and the route

Know what it’s worth, honestly. Use the calculator, then get an independent valuation. If the number is lower than you need, you’ve found out while you can still do something about it, which is the point of starting early.

Choose the route:

• Trade sale to a competitor, supplier, customer or a larger group. Usually the most money on the day. Buyers pay for synergies and for removing a competitor. Expect thorough due diligence.
• Management buyout. Sale to your own team, funded by their money, bank debt, sometimes an investor, and often you lending part of the price. Continuity, but slower money and your risk.
• Employee ownership trust. Sale to all employees via a trust, 0% capital gains tax if it qualifies, paid from future profits over years.
• Private equity. Sells part or all to an investor who wants a return in three to five years, usually keeps you in for a period with a stake.

The comparison in full is in business exit planning.

Get the tax right before the price. In 2026/27, Business Asset Disposal Relief taxes the first £1m of qualifying lifetime gains at 18% and the rest at 24%, and the £1m lifetime limit is set to fall to £500,000 from 6 April 2027. That change moves the after-tax number for a lot of owners, and it’s a reason to talk to a tax adviser this year, not next.

Six to nine months out: the deal

1. Appoint advisers. A corporate finance adviser or broker to find buyers and run the process, an accountant for the tax, a solicitor for the sale agreement. Fees are a percentage of the price plus fixed costs; ask for them in writing.
2. Prepare the information memorandum. The document that sells the business: what it does, the numbers, the team, the market, why the profit will continue. The two years of preparation is what fills it.
3. Approach buyers. Confidentially, under non-disclosure agreements. More than one, so you have competition.
4. Heads of terms. Price, structure (cash on completion, deferred, earn-out), what you’re committing to afterwards. Non-binding, but hard to move afterwards, so get the structure right here.
5. Due diligence. The buyer’s accountants and lawyers go through everything. Weeks to months. The clean-up two years earlier is what makes this go quickly.
6. Sale and purchase agreement. Warranties (promises about the business that cost you money if wrong), indemnities, restrictive covenants (you won’t compete), your handover terms.
7. Completion. Money moves, shares transfer, and you go and do whatever you built this for.

The mistakes that cost the most

• Selling a job. The business depends on you, so the buyer pays less, defers more, and ties you in. Years of work to avoid, and most owners don’t start it.
• Taking the first offer because the process is tiring. Competition between buyers is what moves the price. One buyer is a negotiation; two is an auction.
• Earn-outs with targets you don’t control. If 40% of your price depends on profit over three years under someone else’s management, understand exactly how profit is defined and who decides the costs.
• Not knowing your number. Both what the business is worth and what you need. They’re different questions, and owners who confuse them either hold out for a price nobody will pay or let it go for less than they can live on.
• Telling the team too early, or too late. Too early and good people leave; too late and the buyer meets a team that feels deceived. Your adviser will have a view. Decide it deliberately.
• No plan for the day after. Owners with nothing to go to drift back into the business, resent the buyer, and burn through the money.

Questions owners ask

How long does it take to sell a business? Six to nine months for the deal itself, once the business is ready. Two years before that to get the price up. Rushing the second part is the expensive mistake.

Do I need a broker to sell my business? Not always. If a known buyer approaches you, an accountant and a solicitor may be enough. For a competitive process with several buyers, an adviser usually pays for themselves.

What’s the difference between selling shares and selling assets? A share sale transfers the company, with everything in it, and is usually better for the seller’s tax. An asset sale transfers the business’s assets to the buyer’s company and leaves you with the shell. Buyers often prefer assets; sellers usually prefer shares. Your accountant will model both.

Should I tell customers I’m selling? Not until the deal is certain, and then with the buyer, as a handover. Customers follow confidence.

I’m Dr Lewis Haydon, a business coach and mentor in Birmingham, UK. I own and invest in businesses, and I work with owners of established businesses from about £250k turnover, scaling to £1m and on to £20m, on the two years of work that decide the price: the management team, the margins and the numbers. If you’re thinking about selling and want an owner’s view before you talk to a broker, bring it to a virtual coffee.