The Four Phases of a Business Sale (and How Long Each Takes)
Every business sale follows the same four phases, whether you're selling a $500K service company or a $10M manufacturer. The total timeline for a Metro Detroit business typically ranges from 6-12 months, with preparation being the phase most owners underestimate.
Phase 1: Pre-Market Preparation
2-3 monthsFinancial cleanup, valuation, CIM preparation, advisory team assembly
Phase 2: Confidential Marketing
2-4 monthsBuyer outreach, NDA management, initial meetings, multiple LOI solicitation
Phase 3: Due Diligence
1-3 monthsFinancial audit, legal review, customer verification, operational assessment
Phase 4: Negotiation & Closing
1-2 monthsPurchase agreement, financing finalization, transition planning, closing
What Speeds Up (and Slows Down) the Sale Timeline
Accelerators
- +Clean financials with 3 years of tax returns matching your P&L. Saves 1-3 months in due diligence.
- +Documented SOPs show the business runs without you. Buyers move faster when risk is lower.
- +Realistic pricing within 10% of appraised value. Overpriced listings sit for months.
- +Seller financing willingness. BizBuySell data shows businesses with seller financing sell 30% faster.
- +Growing revenue trend. Flat or declining revenue adds 3-6 months as buyers negotiate harder.
Delays
- -Messy books require reconstruction. Buyers wait or walk if they can't verify numbers.
- -Customer concentration above 15-20% triggers deep due diligence and lower offers.
- -Lease issues. Landlord assignment approval can take 30-90 days and is the #1 closing delay.
- -SBA loan processing adds 60-90 days from application to funding.
- -Emotional decision-making. Owners who waiver on price or terms extend negotiations by months.
Michigan-Specific Timeline Factors
The Metro Detroit business market has specific dynamics that affect sale timelines:
Manufacturing businesses
Equipment-heavy businesses require environmental assessments and equipment appraisals, adding 30-60 days. Michigan's manufacturing base means more buyers understand the sector, but due diligence is more thorough.
Seasonal businesses
Michigan's tourism, landscaping, and construction businesses sell best when listed during their peak revenue months. Listing in winter when revenue is low means buyers see the worst numbers first.
Multi-location businesses
Each location needs separate lease assignment and local permit review. A 3-location Metro Detroit business can add 60-90 days to closing versus a single-location business.
Professional practices
Medical, dental, legal, and accounting practices in Michigan have licensing and credentialing requirements that add 30-60 days. Non-compete enforceability in Michigan also requires specific legal attention.
Know Where You Stand Before Listing
The single biggest factor in sale speed is preparation. See our Exit Planning Checklist for the complete preparation roadmap, or get a quick valuation estimate to understand your starting position.
Business Sale Timeline FAQ
What is the average time to sell a small business in Michigan?+
The average is 6-10 months from listing to closing for a prepared business, and 10-18 months for an unprepared one. According to BizBuySell's 2024 Insight Report, the national median is 199 days from listing to closing (about 6.5 months) -- but this only counts businesses that actually sold. Add 2-3 months of preparation before listing, and the realistic timeline is 8-13 months start to finish.
What is the fastest a business can sell?+
In exceptional cases, businesses can sell in 60-90 days -- but only when the stars align: clean financials, documented operations, no customer concentration, a competitive industry with active buyers, reasonable asking price, and a ready buyer already identified. Businesses with SBA pre-qualified buyers can close in 90-120 days once an LOI is signed.
What causes a business sale to take longer than expected?+
The top delays are: messy or incomplete financial records (adds 2-4 months), unrealistic pricing (business sits on market with no offers), lease or landlord complications (1-2 months), seller financing disagreements (1-2 months), environmental or regulatory issues (2-6 months), and buyer financing challenges (SBA loan processing takes 60-90 days).
Does the size of the business affect how long it takes to sell?+
Yes, but not always how you'd expect. Businesses with SDE under $250K often take the longest (12+ months) because the buyer pool is limited to individuals, and financing is harder. The sweet spot is $500K-$3M in SDE, which attracts the largest pool of SBA-qualified buyers and typically sells in 6-9 months. Businesses above $5M SDE often sell faster (4-8 months) because they attract institutional buyers with ready capital, though due diligence is more extensive.
Ready to Take the Next Step?
Find out how ready you are or talk to an advisor about your options.