How Hard is it to Sell a Business?

A random search online about percentages of small businesses which sell will produce a variety of responses.

According to surveys approximately 30 to 40% of businesses listed for sale actually ever sell. --- Investmentbank.com

But only one out of every 5.5 businesses in the Main Street market – a little less than 20% – actually sells. --- World Wide Business Brokers

EPI estimates that some 4.5 million firms representing more than $10 trillion in business value will transition over the next decade or so, but Snider believes only about 20 percent to 30 percent of businesses that go to market end up selling. --- Forbes

The common opinion seems to place the likelihood of you selling your business in the 20% - 30% range. However, if you look at the chart below - the closings as recorded on BizBuySell as a percentage of total listings on BizBuySell - the percentage is FAR less at 6%.

These figures can be deceiving if taken out of context. The "listings" include all businesses listed by real estate agents, for-sell-by-owners, CPAs, etc etc.

The closing percentage averages a dismal 6.24% over more than 700,000 listings, covering the last 20 quarterly reports as posted on BizBuySell.

The closings are only those recorded by brokers through BizBuySell - so there may be several more than indicated. It is understood this chart may not reflect the reality of closings.

However, when dealing with privately held companies it is very difficult to get figures on business acquisitions, and multiples used. Typically the best gauge is a service like BizBuySell; or, analyzing SBA loan reports on small business financing deals.

These numbers by BizBuySell, combined with a variety of random searches, will produce a very general snap shot. The picture is still not great for business owners looking to sell. The range indicates that 6% - 30% of businesses listed for sell actually close.

The process is difficult. Make sure you get somebody to help that has been around and done several deals. The odds are stacked against you as it is. Even the playing field - hire a professional!

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