Be sure your business is always ready to sell

This article will ... Review why so many businesses put up for sale never complete the deal. List the roadblocks business owners face when it comes to selling their business. Describe ways business owners can make their enterprise sellable and find buyers.

Seventy percent of business owners are over the age of 50, and 75 percent say they would like to exit their businesses in the next 10 years.¹ And for about half of today’s owners, selling their businesses is their preferred exit strategy, according to the 2025 MassMutual Business Owner Perspectives Study,

The problem? Historically, it’s been estimated that 75-80 percent of businesses that get put up for sale never sell.

So why do so few businesses transact? Simple. The business (and the owner) isn’t ready. In other words, owners haven’t built a transferable business — one that has the ability to generate future revenue and profit after they leave. In many cases, a buyer never emerges, or if one does, they are often unwilling to pay the asking price or unable to meet the required terms due to a proliferation of risks uncovered during the due diligence process

When owners take the necessary steps to build a transferable business, the timing of their exit becomes irrelevant. However, owners are often their own roadblock to building a transferable business because they are:

• “Unicorn hunting.” They are holding out for that perfect buyer. In fact, 1 in four say they will exit only when the right buyer comes along.
• Viewing the business as their “baby.” They are not taking the necessary steps to select, train, and groom the right successors. In fact, only 21 percent have even identified potential buyers to take over.
• Viewing the business as their “lifestyle.” They can’t exit because their personal financial well-being is inextricably tied to the business. In fact, nearly half say their main goal at exit is to ensure their current lifestyle is maintained in retirement.
• Attempting to sell a business in decline. Potential acquirers want assurances that a business’s revenue and profit will grow even after the owner leaves. Unfortunately, the MassMutual study found nearly 60 percent of business owners believe their business value is as high as it can be.
• Attempting to sell a job, not a business. Potential acquirers aren’t buying a business so that they can get into the weeds and manage every nuance of the business. Yet, according to the MassMutual study, only 35 percent of owners have built a strong management team to make the owner redundant in the business.

Still, the number of business transactions is on the rise; there was an 8 percent increase in transactions from Q3 2024 to Q3 2025, according to online marketplace BizBuySell. Yet twenty percent of the surveyed owners admitted to not being prepared to sell their businesses.

Building a transferable business

With retirement looming for baby boomer business owners, many want to exit, but few have taken the necessary steps to build a transferable business. Here’s what you can do to help ensure that you find a ready, willing, and able buyer for your business when the time comes to leave.

1. Have an experienced management team in place. When the transition occurs, an acquirer wants the team to be well-trained and ready to continue responsibility for day-to-day operations. The management team can also provide valuable continuity throughout the transition, maintaining the flow of goods and services, fortifying relationships with vendors and clients, and fostering the continued loyalty of valuable employees.
2. Have sufficient documentation, especially for detailed policies, procedures, and processes. Documentation that simplifies complexities in the business and protects competitive advantages in the market will ease transferability and strengthen an acquirer’s belief that the business will continue to be successful when the owner is gone.
3. Position the business to maximize key value drivers, such as streamlining operations, modifying the capital structure for growth, normalizing the books to eliminate any commingling of personal and business expenses, and more. Owners who fail to do this can find it difficult to find a buyer willing to meet the seller’s price and terms.
4. Reduce risks, such as owner dependencies, lack of diversification in products, customers and vendors, and incomprehensible financial reporting and legal documentation. Potential acquirers will make an offer based on how much risk they must assume. The less risky the business, the more they are willing to offer. Too much risk and they will simply walk away.

Transferability risk can also emanate from threats outside the business and are out of the control of the owner, such as increased competition, shrinking market size, and decreased barriers to enter the market to name a few.

That’s why it’s so important to get what you can control in order and not procrastinate with your transition planning. After all, the goal is to build a business that stands out among all the businesses in your vertical ― so that it’s your outfit that acquirers want to chase.

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