Preparation is the only work that raises the price and shortens the sale at the same time. Ordered here by return: the things that change the multiple first, the things that change the earnings second, and the paperwork last, because paperwork can be done quickly and dependency cannot.
Get quotes to sell my business
Months one to six: reduce dependence on you
If you are the salesperson, the estimator or the only person the good customers will deal with, the buyer is pricing a business that may not survive your departure. Delegate deliberately, document the processes, and create a record of work won and delivered by other people. This changes the multiple, which is worth more than any change to the profit line.
Months six to ten: fix the revenue quality
Convert one off customers to contracts or agreements where the trade allows it. Address the largest customer concentration if you can. Stop taking low margin work that flatters revenue and depresses the margin a buyer will compute. Buyers reconstruct margin by job or by customer, so the tidy version has to be true.
Months ten to twelve: the file
Three years of statements a stranger can follow, tax returns that agree with them, a documented add back schedule, the lease read and any assignment restriction identified, contracts checked for change of control clauses, and staff records with pay and any restrictive covenants. This is the part that shortens diligence by weeks.
Questions people ask about preparing to sell your business
Is a year really necessary?
If the business depends on you or the records are informal, yes. If it already runs without you and the books are clean, three months is enough.
What is the highest return single action?
Removing yourself from the critical path of winning and delivering work. It changes the multiple rather than the earnings.
Should I tell my accountant what I am planning?
Yes, early. The add back schedule and the tax shape of the sale start with them, and both take time to get right.