In the marketplace of Main Street types of businesses (generally ranging in total annual sales up to $2 million) the length of time it takes for a business to sell under confidential disclosure conditions stays fairly even over time. A recent market survey of business brokers reports that it takes, on average, about 9 months for a business to sell after it is listed for sale. This is drastically different than the residential housing market where the average is usually under a month. Why is this the case? For several primary reasons. First, the process of selling, even when there are no complications, is stretched out because of preparation time required to put it on the market, which can take as much as a month if the seller documentation is not ready to go. Second is the time needed to find and screen buyers for financial capability and suitability to manage the company. Third is the time required for the buyer to inspect the company, its operating procedures, and its financial reports (commonly known as due diligence). Forth is the time required to arrange financing for the buyer (which will generally take at least 60 days if a SBA guaranteed loan is involved). And keep in mind that 9 months is the average. The range of time is very broad, and in my experience can take as long as 3 years! It will help all sellers and buyers to plan accordingly.
