Top 5 Mistakes to Avoid When Selling Your Business

Selling your business is rarely simple. Even seasoned business owners can slip up, and those slip-ups aren’t cheap. If you underestimate your company’s value, skip the legal fine print, or manage buyer negotiations poorly, you risk accepting an undervalued offer or having a deal stall unexpectedly. 

In this guide, we’ll look at the five most common mistakes you can make when you sell your business and how you can avoid them.

1. Rushing the Exit Without a Plan

Scrambling to organize financial records, legal contracts, and tax filings after a buyer appears is a big red flag. Incomplete books or outstanding compliance issues can slow down due diligence, undermine buyer confidence, and result in lower offers or even deals going sour. 

By creating an exit plan long before it’s time to sell your business, you can address small cracks before they turn into major issues. For example, cleaning up financials years before a sale allows you to fix operational quirks that buyers might misinterpret, like irregular cash flow patterns or vendor dependencies.

2. Handling the Sale Entirely by Yourself

Selling your business alone is quite risky, particularly if you do not have experience in the field. Accountants and business brokers are experts: They know how to position your company, connect with potential purchasers, and negotiate on terms favorable to your interests. 

While partnering with a pro may cost you more initially, they’ll likely help you negotiate a higher selling price, which can ultimately offset their fees.

3. Forgetting That Not Every Buyer Is the Right Fit

Buyers aren’t the only ones who should ask tough questions: You should, too. This is because your team’s future, your customers’ trust, and your life’s work are on the line. Vetting potential buyers safeguards the people and principles you value. 

Will the buyer be able to get funding quickly? Do their previous acquisitions indicate that they will proceed or abruptly back out? Do they intend to completely revamp everything, or do they respect the experience of your team? If you’re not happy with the answers, consider moving on.

4. Planning for the Sale — But Not After

Selling your business feels like crossing a finish line — until you ask yourself, “What’s next?”

There are two things to keep in mind: First, the sale might not cover your retirement as comfortably as you’d hoped. Taxes, fees, and living costs add up fast, and without clear financial goals, that payout won’t stretch as far as expected. Second, leaving a company you’ve run for years can feel like losing part of yourself. 

Before you sell, speak with a financial advisor to create a post-sale budget that accounts for inflation, family needs, and healthcare. Your next chapter can get off to a strong start with their assistance.

5. Letting the Buyer Take the Lead

Putting your business on the market should be your decision, not something you rush into because a buyer pops up out of the blue.

Accepting an unexpected offer gives the buyer the upper hand, taking control away from you. They can set terms that benefit them or exploit unresolved weaknesses. For this reason, you should start a sale only after you’re sure your business is ready. This approach helps you retain control over the process, pricing, and negotiations. 

Exit Strong With These Strategies

Transitioning ownership of your business requires careful planning. By avoiding these common errors, you can position yourself to negotiate favorable terms, secure optimal value, and exit on your own timeline.