What is the process of selling a small business?

Selling a small business can feel like trying to renovate your house while someone’s already walking through it with a clipboard. The process is manageable, but only if you understand the sequence and where the common potholes are.

Below is a seller-centric map from “I might sell” to “we closed,” with the parts that actually affect price and timeline.

Step 1: Clarify What “Ready” Means for You

The sale starts earlier than most owners think. This step matters because it prevents you from listing out of curiosity, then negotiating under pressure.

At minimum, get clear on:

• Your timeline and what you want to do after closing

• How involved you’re willing to be post-sale

• The minimum outcome you need (and what’s flexible)

This is also where you decide whether you’re optimizing for speed, certainty, or maximum price, because those goals can pull the deal in different directions.

Step 2: Anchor Value Before You Market Anything

Pricing is positioning. If you go to market without a valuation story, buyers will create one for you, and they will usually do it in a way that protects them, not you.

A helpful first move is to understand the methods and levers behind your range, not just the headline number. Baton’s guide to selling your business brings valuation, prep, and go-to-market decisions together in one place.

If you want an external reference for what selling entails at a high level, the U.S. Small Business Administration’s overview on closing or selling your business is a useful sanity check.

Step 3: Prepare The Business And The Materials Buyers Expect

This is where sellers accidentally create delays. Buyers do not mind that you are a small business. They mind when the basics are unclear.

Before you list, build the core package buyers will request early:

• Financials: Clean P&Ls, balance sheet, tax returns, clear add-backs.

• Operations: Headcount, roles, systems, key vendor dependencies.

• Commercials: Customer mix, top contracts, lease terms, pricing model.

• Story: What drives growth, what’s changing, what’s stable.

If you want a specific prep path, our walkthrough on preparing your business for sale aligns with what buyers typically look for first.

The goal here is not to build a museum of documentation. It’s to remove the kind of uncertainty that can later turn into negotiation leverage.

Step 4: Go to Market With Controlled Access

Most sellers think marketing is the hard part. In reality, access management is where deals live or die.

A clean flow usually looks like:

• A listing or profile that is clear, but not overly revealing

• An NDA before sensitive information is shared

• Staged disclosure (broad first, detailed later)

• A structured Q&A rhythm so you do not spend nights answering one-off emails

Baton’s overview of what happens after listing your business for sale lays out this controlled access phase in a way that is practical for busy owners.

Step 5: Evaluate Offers and The LOI Like a Builder, Not a Tourist

The Letter of Intent is where the deal turns from “interest” into “commitment.” It is not final paperwork, but it sets the tone for diligence and closing.

When reviewing an LOI, pay attention to:

• Purchase price and how it’s paid (cash, seller financing, earnout)

• Asset sale vs stock sale implications

• Working capital expectations

• Diligence scope and timeline

• Exclusivity period (how long you are off the market)

Taken together, an LOI isn’t just a price tag. It’s the buyer’s first draft of how they plan to get to closing. The clearer these terms are now, the fewer surprises you’ll have when diligence starts and the leverage shifts from interest to proof.

Step 6: Due Diligence and Financing

This is where the buyer verifies the story, and lenders verify the buyer. Even strong deals slow down here if documents are scattered or explanations live only in your head.

A disciplined diligence process:

• Centralizes documents

• Assigns one person to manage responses

• Keeps a weekly cadence

• Documents answers once, then reuses them

If you want a clear definition of due diligence from a finance education perspective, Corporate Finance Institute’s overview is straightforward.

Step 7: Legal Docs, Closing, and Transition

Closing is the paperwork and the handoff plan. Buyers want confidence that the business will keep running the day after money moves.

Expect to work through:

• The purchase agreement and disclosures

• Non-compete and employment terms (as applicable)

• Lease assignments, consents, and third-party approvals

• A transition schedule (who trains whom, for how long, and on what)

A clean transition plan is often the difference between a smooth close and a last-minute renegotiation.

The Part Most Owners Underestimate

Selling is not one task. It is a series of small, verifiable steps that reduce buyer risk.

If you want a path that blends technology with hands-on brokerage support, Baton’s sell-your-business flow is designed to help owners move through each stage without turning the sale into a second full-time job.