How to Get the Best Price When Selling Your Business

The highest offer isn't always the best deal. Here's what can make a real difference to the price you achieve, the terms you agree and whether the sale actually completes.

When you've spent years building a business, you naturally want to achieve the best possible price when it's time to sell.

But price is only part of the picture.

An offer of £1 million might look better than one of £900,000. But what if the first buyer wants to pay a significant proportion over the next three years, while the second can pay in full on completion?

Or what if one buyer is offering more money but has yet to secure funding, while another is ready to proceed?

Then there are the things that matter beyond the numbers. You might want to protect your employees, see the business continue under a new owner or preserve something you've spent a lifetime building.

The best deal is the one that works for you, financially and personally, and has a realistic prospect of completing.

So, what can you do to put yourself in the strongest position?

1. Get your financial information in order

Buyers want to understand how your business makes money, how consistently it performs and whether those profits are likely to continue.

That starts with having accurate, up-to-date financial information.

Ideally, you'll have three years of accounts available, supported by current management figures that show how the business is performing today.

It's also worth taking a closer look at any unusual costs or income that might distort the underlying profitability.

Perhaps you had to replace a roof unexpectedly, incurred a one-off legal expense or made an investment that won't need repeating. These are all things that may need explaining to a buyer.

In some circumstances, adjustments can help demonstrate the maintainable profit of the business. But they need to be reasonable, supported by evidence and presented transparently.

A buyer isn't simply going to accept every expense you describe as exceptional.

This becomes particularly important during due diligence, when the buyer and their advisers examine the information behind the agreed offer.

The better prepared your financial information is, the easier it becomes to support your asking price and avoid uncomfortable surprises later.

2. Show buyers where future growth could come from

A buyer isn't just purchasing what your business has achieved. They're also considering what it could achieve under their ownership.

That makes future growth an important part of the conversation.

Perhaps you've identified an opportunity to expand into a new geographical area, introduce an additional service or increase sales to your existing customers.

Those opportunities can make your business more attractive, particularly when you can demonstrate that demand exists.

At Intelligent, we often say:

"We can sell what we can evidence."

There's an important difference between telling a buyer that a new product could generate £200,000 in additional revenue and showing them that you've already secured customers, tested demand or started generating sales.

The second is a much stronger proposition.

Buyers will naturally question opportunities that have been available for years but never pursued. If the potential is so significant, why hasn't the business taken advantage of it already?

That doesn't mean you need to launch an entirely new division before selling.

But taking practical steps to demonstrate an opportunity can give buyers greater confidence in its potential.

And confidence can make a difference when they're deciding what they're prepared to pay.

3. Understand what the offer really means

This is where selling a business can become more complicated than many owners initially expect.

An agreed headline price doesn't necessarily mean you'll receive that amount on completion.

Depending on the buyer, the business and the transaction, part of the consideration may be paid later or linked to future performance.

Two common arrangements are deferred payments and earn-outs.

Deferred payments

A deferred payment means the buyer agrees to pay part of the purchase price at a later date.

For example, you might agree to sell your business for £1 million, receiving £700,000 on completion and the remaining £300,000 over an agreed period.

That may help make a deal possible, but it also means you're relying on the buyer to meet those future obligations.

You'll want to understand when the payments are due, what protections are available and what happens if the buyer fails to pay.

Earn-outs

An earn-out is different because part of the price depends on the business achieving agreed results after the sale.

For example, you might receive an additional payment if the business reaches a particular profit target over the following two years.

This can work well where both parties have confidence in the future performance of the business.

However, earn-outs need careful consideration.

If the buyer takes control of staffing, investment, pricing and other important decisions, those choices could affect whether the targets are achieved.

Remaining involved in the business may help in some circumstances, but it doesn't remove that risk.

The important thing is to agree clear, measurable targets, understand who controls the decisions that affect them and establish what happens if circumstances change.

A higher offer with uncertain future payments isn't automatically better than a slightly lower offer with greater certainty.

That's why it's important to compare the whole deal, not just the figure at the top of the offer.

4. Make your business easier for someone else to run

There's another factor that can influence how buyers assess a business: how much it depends on you.

If you're responsible for winning every major customer, managing key suppliers, overseeing day-to-day operations and making most of the important decisions, a buyer may see that as a risk.

After all, what happens when you leave?

A business with a capable management team, established processes and strong customer relationships that don't depend entirely on the owner can be easier to transfer.

That doesn't mean you need to make yourself redundant before selling.

It means demonstrating that the business can continue performing when you're no longer involved in every decision.

Even relatively straightforward improvements, such as documenting key processes, delegating responsibilities or strengthening the management team, can help.

The less uncertainty a buyer sees in the transition, the more comfortable they may be with the acquisition.

5. Give yourself enough time

One of the most common mistakes business owners make is leaving the preparation until they've already decided they want to sell.

By that point, there may be limited time to address anything that could affect the valuation.

Perhaps your accounts need tidying up, a major customer contract is approaching renewal or the business has become too dependent on you personally.

These things aren't necessarily deal-breakers, but they're often easier to address before the business goes to market.

Starting the conversation early gives you more options.

You can understand what your business might be worth today, identify areas that could make it more attractive and decide whether selling now is the right move.

You may even discover that making a few changes and waiting another year or two could put you in a stronger position.

Of course, not everyone has the luxury of time. Retirement, health, family circumstances or a change in priorities can all influence when someone decides to sell.

But where you can plan ahead, it's usually worth doing.

6. Choose a broker who understands more than the asking price

A good business broker should do more than advertise your business and pass on enquiries.

They should help you understand its value, identify suitable buyers, assess offers and negotiate terms that work for you.

That includes asking questions about a buyer's intentions and financial position before you invest too much time in progressing a deal.

It also means recognising when an apparently attractive offer carries risks that need addressing.

For example, a buyer offering the full asking price may still need substantial borrowing, additional investment or approval from other parties before they can proceed.

Another buyer might offer slightly less but have the funding, experience and commitment to complete the transaction.

Creating interest is important. Turning that interest into a completed sale is what ultimately matters.

An experienced broker can help you weigh up the options and negotiate with a clearer understanding of the commercial realities.

Getting the best price is about more than the number

Selling a business is rarely as simple as agreeing a figure and handing over the keys.

There are financial, practical and personal considerations, and every owner will have a slightly different view of what a successful sale looks like.

For some, achieving the highest possible return will be the overriding priority.

For others, the certainty of completion, the future of their employees or the opportunity to make a clean break may be just as important.

Whatever your priorities, the strongest starting point is a well-prepared business, realistic expectations and a clear understanding of the offers on the table.

You don't have to work all of that out on your own.

Thinking about selling your business?

At Intelligent, we help owners understand what their businesses are worth, find suitable buyers and work through the sale process, from the first conversation to completion.

Whether you're ready to sell now or simply thinking about what comes next, we're happy to talk through your options.

We can provide a free, confidential business Valuation and practical advice on what buyers are likely to look for.

There's no obligation to sell.

No jargon. No pressure to sell. Just clear, useful advice.