Author:
Eric J. Gall, MBA, CM&AP, CBI, ABI, M&AMI
As a business owner, you have likely poured your heart and soul into your business, nurturing its growth and ensuring its success. Now, you are contemplating the next big step of selling your business. To achieve the best outcome in 2026, the key is to start planning now. Here is a six-month plan to help you prepare your business for sale to ensure you maximize its value and attract the right buyer.
Eric J. Gall, MBA, CM&AP, CBI, ABI, M&AMI
As a business owner, you have likely poured your heart and soul into your business, nurturing its growth and ensuring its success. Now, you are contemplating the next big step of selling your business. To achieve the best outcome in 2026, the key is to start planning now. Here is a six-month plan to help you prepare your business for sale to ensure you maximize its value and attract the right buyer.
MONTH 1: ASSEMBLE YOUR ADVISORY TEAM
Hire a Business Broker: Hire a business broker to help you navigate the sales process. Click here for our Ultimate Guide for Selecting a Business Broker. Engaging a business broker will impart valuable insights, provide an opinion of value and price, market your business confidentially, screen and identify buyers, organize and conduct seller/buyer meetings, help negotiate and structure a deal, manage due diligence and closing, and free you to continue to run your business.
Engage Your Accountant: Work with your accountant to understand the financial implications of your sale, including tax liabilities and deal structure. Contacting them in advance will ensure all members of your advisory team are on the same page and working together to achieve your goals.
Engage Your Attorney: Work with your attorney to address any legal issues or disputes and review whether you have any right-of-first-refusal agreements with employees to purchase your business. Addressing problems now will prevent issues from arising during due diligence that could cause prospective buyers to walk away.
Hire a Certified Exit Planning Advisor (CEPA): Hire a CEPA to help you implement many of the steps outlined below. Edison Business Advisors is staffed with Certified Exit Planning Advisors. Working with a CEPA will remove some of the burden of preparing your business for sale, guide you through the process, and optimize the value of your business.
MONTH 2: ASSESS AND EVALUATE
Gather and Review Financial Records: Gather and review your financial records, including tax returns and financial statements (P&Ls and balance sheets - in accrual method if tax returns are in cash method) from the past three to five years. Ensure they are accurate, complete, and well-organized. If you are running personal or discretionary expenses through your business, note these expenses in your general ledger so you and prospective buyers can easily identify them to add back to your bottom line, showing the true value of your business. Your financial records will be utilized by your business broker or certified appraiser to determine the value of your business. They will also give prospective buyers key insights to assess your business's fiscal health and potential. Having documents organized and ready will streamline these processes.
Conduct a Business Valuation: Determine the current value of your business by working with your business broker or certified appraiser. Edison Business Advisors is staffed with business brokers capable of providing an opinion of value and Certified Business Appraisers and Valuation Analysts for certified appraisals, if you prefer. Click here to learn the differences between an opinion of value and a certified appraisal. Understanding your business’s value will provide a clear picture of what prospective buyers might pay.
Identify Strengths and Weaknesses: Conduct a SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis to identify areas for improvement. Click here for eight free SWOT analysis templates to help you get started. Addressing weaknesses now will enhance the overall value of your business to prospective buyers.
MONTH 3: STREAMLINE OPERATIONS
Optimize Processes: Review and optimize your business processes to ensure they are efficient and effective. Implement necessary changes to improve productivity and profitability, such as leveraging technology to automate tasks, implementing collaboration tools to streamline communication, utilizing project management tools to allocate resources effectively, etc. Taking measures now will make your business more attractive to prospective buyers and potentially increase your business's value.
Document Standard Operating Procedures (SOPs): Create or update SOPs for all critical business functions. If you need to document your procedures, ask your employees to write work instructions on how they perform their daily tasks. Make sure their work instructions align with the expectations of other employees or customers when exchanging information or transferring products. Click here for thirteen free SOP templates to assist you. Having well-documented procedures will give prospective buyers confidence and make it easier for a new owner to transition into your business seamlessly.
Document Assets and Intellectual Property: Compile a list of assets that will transfer with your business, such as equipment, vehicles, inventory, and customer information. If applicable, document any intellectual property, such as patents, trademarks, and copyrights. Gathering this information will give prospective buyers a clear understanding of what they are acquiring.
Strengthen Management Team: Ensure your management team is strong and capable of running your business without your direct involvement. If you are heavily involved in the daily operations of your business, develop or hire a strong second-in-command to take over your responsibilities. Having a strong management team demonstrates your business's ability to function independently, assuring prospective buyers that operations can continue smoothly without reliance on previous ownership.
MONTH 4: IMPROVE FINANCIAL HEALTH
Reduce Debt: Work on reducing any outstanding debts, such as renegotiating terms, paying off small debts, refinancing loans, and selling underutilized assets and/or obsolete inventory. Having a healthy financial position will make your business more attractive to prospective buyers.
Increase Cash Flow: Focus on increasing your cash flow by managing expenses, optimizing pricing strategies, and boosting sales efforts. Having a strong cash flow will signify to prospective buyers your business’s ability to sustain daily operations, pursue growth opportunities, and navigate financial challenges effectively.
Implement Cost-Saving Measures: Identify and implement cost-saving measures to improve profitability, such as negotiating better rates or bulk discounts with suppliers, automating repetitive tasks, optimizing inventory carrying costs, minimizing overstocking, and monitoring cash flow closely. Having a strong profit margin will attract more prospective buyers and increase the value of your business.
MONTH 5: IMPROVE MARKET POSITION
Enhance Branding: Invest in branding efforts to enhance your business’s market position. If you need to improve your branding, contact your satisfied customer base and ask them to leave 5-star or positive reviews on websites in exchange for discounted products and/or services. If you have negative reviews, address them promptly and attempt to turn a negative into a positive through communication, care, and concern. If you have many negative reviews, hire a reputation management firm to help change the public perception of your business. Having a strong brand will significantly increase the perceived value of your business to prospective buyers.
Expand Customer Base: Focus on expanding your customer base and diversifying your revenue streams. If any customer accounts for over 15% of your annual revenue consistently year-to-year, change your marketing strategy to gain new customers until no customer exceeds this threshold. Although this process may be challenging and require significant time, cultivating a broad and loyal customer base will demonstrate to prospective buyers that your business is resilient, not reliant on a handful of customers, and capable of sustaining steady revenue growth in the future.
Strengthen Online Presence: Improve your online presence by updating your website, engaging in social media marketing, and optimizing search engines. It may be helpful to hire a marketing firm to assist in implementing a plan. Having a robust online presence will attract today’s tech-savvy prospective buyers.
MONTH 6: PREPARE FOR DUE DILIGENCE
Resolve Tax Issues: Resolve any tax issues. Addressing issues now will avoid surprises during due diligence and losing prospective buyers' confidence in you and your business.
Organize Legal Documents: Gather and organize all legal documents, including contracts, leases, licenses, and intellectual property agreements. Having these documents ready will streamline the prospective buyers' due diligence process.
Resolve Legal Issues: Work with your attorney to address any outstanding or pending legal claims, liens, litigations, or lawsuits against your business or property that may affect a sale. Resolving legal matters will prevent prospective buyers from becoming wary of your business’s ability to maintain stability or future operations.
Resolve Other Issues: Address any other outstanding or pending issues that may affect a sale, such as insurance claims, delinquent loans, regulatory compliance issues, and unpaid taxes, suppliers, payroll, or rent. Demonstrating a commitment to maintaining a well-managed and problem-free business will reassure prospective buyers of your business's stability and long-term viability.
CONCLUSION
By following this six-month plan, you will be well on your way to preparing your business for a successful sale in 2026. Starting early allows you to address any issues, optimize operations, and position your business as a valuable asset to prospective buyers. With careful planning and the right professional support, you can optimize your business's value and achieve a smooth transaction.
Edison Business Advisors is dedicated to supporting you through every stage of the sales process. Together, we can achieve your business sale goals by maximizing your business’s value and attracting the right buyer. Contact us for a complimentary, confidential consultation to discuss your needs.
