Question 1

How do I sell my small business?

Accepted Answer

Selling a small business starts long before you go to market. You need clean financials, documented processes, predictable cash flow, and an operation that does not depend entirely on the owner. From there, the process typically looks like: get a realistic valuation, fix what buyers will flag in diligence, package the business, run a confidential sale process, and then negotiate and close. Owners who prepare two to three years in advance almost always sell for more than owners who go to market reactively.

Question 2

How much can I sell my business for?

Accepted Answer

Most small to mid-sized industrial businesses sell for a multiple of EBITDA or seller's discretionary earnings. Smaller owner-operated companies often trade in the 2 to 4x SDE range. Larger, less owner-dependent businesses with clean books and recurring revenue often command 4 to 7x EBITDA, sometimes higher. The exact number depends on customer concentration, growth, leadership depth, and how transferable the business is. The fastest way to see your range is our free valuation at trustrowan.com/valuation.

Question 3

How long does it take to sell a business?

Accepted Answer

Once a business is genuinely market-ready, the sale process typically takes 6 to 12 months from listing to close. Getting market-ready can take a few months for a clean, well-run business and a few years for one that needs cleanup. The most common reason deals stall is messy or inconsistent financial information, not price.

Question 4

Should I use a business broker to sell my business?

Accepted Answer

If your business is small and simple, a local broker can work. If your business is more complex, has $1M+ in EBITDA, or operates in a specialized industrial niche, you typically want an M&A advisor instead of a generic broker. Advisors run a controlled process, attract qualified buyers, and negotiate with structure in mind, not just price.

Question 5

How do I sell my business without a broker?

Accepted Answer

It is possible to sell on your own if you have a buyer already lined up, your financials are clean, and you are comfortable negotiating terms. You will need a CPA, a transaction attorney, and discipline to keep the deal confidential. Most owners who try this route underestimate how much time the diligence process consumes and how easily a single misstep can erode value.

Question 6

How do I get my business ready to sell?

Accepted Answer

The four things buyers care about most are: clean financials, predictable revenue, low owner dependence, and a documented way of operating. To get ready, reconcile your books monthly, separate personal expenses, document your top processes, diversify customer concentration, and build a leadership layer below you. Most of the value gained in a sale is built in the 12 to 36 months before the transaction.

Question 7

Should I sell my business and retire?

Accepted Answer

That is a personal question, but it has financial inputs. Start by knowing what your business is worth today, what you need to net after tax to fund the life you want, and how dependent your identity is on running it. Many owners discover their current valuation will not fund their retirement goals. That is fixable, but only with time, which is why we recommend starting the conversation early.

Question 8

What taxes will I pay when I sell my business?

Accepted Answer

Tax treatment depends on whether it is an asset sale or stock sale, how much of the purchase price is allocated to goodwill versus equipment, depreciation recapture, and your state. Most sellers are surprised by how much structure matters. A few weeks of planning with a tax advisor before signing a Letter of Intent can change your net proceeds by six or seven figures.

Question 9

What is the best time of year to sell a business?

Accepted Answer

Buyers are active year-round, but most deals are signed in Q2 and Q4. The more important question is timing relative to your business cycle. You want to go to market on a trailing twelve months of strong, clean performance, not in the middle of a slow stretch you cannot explain.

Question 10

Can I sell my business if it is losing money?

Accepted Answer

Yes, but the valuation methodology changes. Unprofitable businesses are typically valued on assets, revenue multiples, or a strategic fit thesis rather than EBITDA. The buyer pool also narrows. If you have a few quarters of runway, it is almost always worth stabilizing first.

Question 11

How much is my business worth?

Accepted Answer

Most small to mid-sized industrial businesses are worth a multiple of EBITDA or seller's discretionary earnings. The multiple reflects risk, growth, customer concentration, and how transferable the business is. Two companies with the same EBITDA can sell for very different prices based on these factors. Get a free instant estimate at trustrowan.com/valuation.

Question 12

What is a business valuation?

Accepted Answer

A business valuation is an estimate of what your company is worth to a willing buyer. It is based on a combination of historical financial performance, projected cash flow, assets, market comparables, and intangible factors like customer relationships and management depth. There is no single 'correct' number, only a defensible range supported by data.

Question 13

How do you calculate business valuation?

Accepted Answer

The most common method for industrial businesses is the EBITDA multiple approach: normalize EBITDA, then apply an industry multiple based on size, growth, and risk. Other approaches include discounted cash flow, asset-based valuation, and comparable transaction analysis. Most real-world valuations triangulate two or three of these methods.

Question 14

What is EBITDA?

Accepted Answer

EBITDA stands for Earnings Before Interest, Taxes, Depreciation, and Amortization. It is a measure of operating profitability that strips out financing decisions, tax structure, and non-cash accounting. Buyers use it because it makes companies easier to compare apples-to-apples.

Question 15

What is the difference between EBITDA and SDE?

Accepted Answer

SDE (seller's discretionary earnings) is typically used for smaller owner-operated businesses and includes the owner's salary, benefits, and personal expenses as part of the cash benefit. EBITDA is used for larger, more institutional businesses and assumes a hired manager runs the company. Generally, businesses under $1M in profit use SDE; businesses above that line shift to EBITDA.

Question 16

What is a good EBITDA multiple?

Accepted Answer

There is no universal 'good' multiple. Industrial businesses commonly trade in the 3 to 7x EBITDA range, with strong companies above that and weaker ones below. Multiples expand with size, recurring revenue, customer diversification, and leadership depth. They contract with owner dependence, customer concentration, and inconsistent earnings.

Question 17

How are EBITDA multiples determined?

Accepted Answer

Multiples are set by the market based on what comparable businesses have actually sold for, adjusted for size, sector, growth, and risk. A diversified industrial services company with strong contracts typically commands a higher multiple than a project-based fabrication shop dependent on a single customer.

Question 18

How much does a business valuation cost?

Accepted Answer

A basic broker opinion of value is often free. A directional online valuation tool is free. A formal certified valuation from a credentialed appraiser typically runs $5,000 to $15,000+, depending on complexity and purpose. For most owners exploring a sale, a free directional valuation is the right starting point.

Question 19

How can I increase my business valuation before selling?

Accepted Answer

The highest-impact moves are usually: clean up financials and reconcile books monthly, reduce customer concentration, build a leadership layer so the business does not depend on you, document key processes, and demonstrate consistent year-over-year growth. Most of these changes take 12 to 24 months to fully reflect in valuation but the payoff is significant.

Question 20

What are add-backs and why do they matter?

Accepted Answer

Add-backs are adjustments to reported earnings that reflect the true cash flow of the business. Common examples include owner's above-market salary, personal expenses run through the business, one-time legal fees, and non-recurring events. Well-documented add-backs increase your defensible EBITDA. Aggressive or undocumented add-backs make buyers skeptical and reduce trust.

Question 21

How do I buy a business?

Accepted Answer

Buying a business has six basic steps: define your search criteria, source deals, evaluate financials, make an offer via a Letter of Intent, conduct due diligence, and close with financing in place. The fastest path is to get clear on your budget, financing, and what you are willing to operate, then commit to a structured search of 6 to 12 months.

Question 22

How much money do I need to buy a business?

Accepted Answer

Most small business acquisitions require 10 to 30 percent down, with the rest financed through SBA loans, seller financing, or a combination. For a $2M acquisition, that is typically $200K to $600K of equity. The real question is whether the business generates enough cash flow to cover the debt service plus your living expenses, not just whether you can write the check.

Question 23

How do I buy a business with no money down?

Accepted Answer

True no-money-down deals are rare and usually involve heavy seller financing, equity from a partner, or assuming a distressed situation. SBA 7(a) loans require at least 10 percent equity injection, and that equity has to come from somewhere documented. Be cautious of programs that promise otherwise; most fall apart in lender underwriting.

Question 24

How do I get an SBA loan to buy a business?

Accepted Answer

The SBA 7(a) program is the most common path to financing a small business acquisition. You will need a strong personal credit profile, 10 percent or more equity injection, a business with consistent cash flow, and a lender experienced with acquisition deals. Get pre-qualified before you start making offers; sellers take you more seriously when you have financing lined up.

Question 25

Should I buy a business or start one from scratch?

Accepted Answer

Buying gives you cash flow, customers, employees, and proven systems on day one. Starting gives you control and a lower upfront cost but no revenue. For most first-time owners, buying a profitable, well-run business is the lower-risk path. The math usually favors acquisition when your time and capital are limited.

Question 26

What is the biggest risk when buying a small business?

Accepted Answer

Hidden owner dependence. If the seller is the reason customers buy, employees stay, and operations run, you are not buying a business; you are buying a job that walks away at closing. Other common risks include messy books, customer concentration, deferred maintenance on equipment, and lawsuits or environmental exposures that surface during diligence.

Question 27

How do I know if a business is priced fairly?

Accepted Answer

Compare the asking price to defensible EBITDA or SDE multiplied by an industry-appropriate multiple. Then stress test: would the cash flow support the debt at the asking price plus a reasonable return on your equity? If the math only works on the seller's most optimistic projections, the price is too high.

Question 28

How long does it take to buy a business?

Accepted Answer

From the first conversation to closing, most deals take 90 to 180 days. The biggest variables are how clean the seller's records are, how quickly the lender moves, and how organized the data room is. Deals with messy diligence routinely drag past 9 months.

Question 29

What should I look for in a manufacturing or industrial business?

Accepted Answer

The four signals that matter most: clean and reliable financial records, predictable cash flow, a diversified customer base, and documented processes that do not live in the owner's head. Revenue size matters less than how repeatable and transferable that revenue is.

Question 30

What is exit planning?

Accepted Answer

Exit planning is the structured process of preparing yourself, your business, and your finances for an eventual transition out of ownership. It typically covers valuation, business readiness, tax and estate planning, leadership succession, and personal post-exit goals. The earlier you start, the more options you have.

Question 31

When should I start exit planning?

Accepted Answer

Ideally 3 to 5 years before you want to transition. That window gives you enough time to materially improve valuation, build a leadership team, clean up financials, and structure the deal in a tax-efficient way. Owners who start 12 months out almost always leave money on the table.

Question 32

What is a business exit strategy?

Accepted Answer

An exit strategy is your plan for how you will leave the business: third-party sale, sale to a strategic acquirer, sale to a private equity firm, internal management buyout, ESOP, family transfer, or wind-down. Each path has very different timelines, valuation outcomes, and tax consequences.

Question 33

How do I plan a business exit?

Accepted Answer

Start with three questions: what do you want personally, what is the business worth today, and what would it need to look like to fund your goals. From there, build a 24 to 36 month plan that addresses valuation gaps, leadership development, financial cleanup, and tax structure. Revisit it every quarter.

Question 34

What is succession planning?

Accepted Answer

Succession planning is the process of identifying and preparing the people, structure, and ownership transition that will keep the business running after you step back. For founder-led businesses, this is often the single most overlooked piece of an exit. Buyers pay more for businesses with a credible second-in-command in place.

Question 35

What is the difference between exit planning and succession planning?

Accepted Answer

Succession planning focuses on who will lead the business after you. Exit planning is broader: it includes succession, but also valuation, financial readiness, tax planning, personal goals, and deal structure. You need both. Succession planning without exit planning is incomplete; exit planning without succession planning is risky.

Question 36

What is a family business succession plan?

Accepted Answer

A family business succession plan addresses ownership transfer to the next generation, leadership development, and the structural changes needed for the business to operate without the founder. It also handles harder questions: gifting versus selling shares, balancing involved and non-involved family members, and protecting the business from inheritance disputes.

Question 37

How do I value my business for succession planning?

Accepted Answer

Use a multi-year approach. Start with a directional valuation today to establish a baseline. Then track how the value changes as you improve operations, customer mix, and leadership depth. Refresh the valuation annually so you always know where you stand relative to your exit goal.

Question 38

What does an exit planning advisor do?

Accepted Answer

An exit planning advisor coordinates the strategy across finance, tax, legal, and operations to get you ready to transition on your terms. They run a readiness assessment, identify gaps that hurt valuation, build a multi-year plan, and stay involved through the actual sale. Done well, the payback is many multiples of the cost.

Question 39

What is due diligence in a business sale?

Accepted Answer

Due diligence is the period after the Letter of Intent is signed where the buyer verifies everything the seller claimed: financials, customer relationships, contracts, employees, equipment, legal issues, and operations. It typically takes 45 to 90 days. Clean, organized records make it faster; messy records create renegotiation leverage for the buyer.

Question 40

What is a Letter of Intent (LOI)?

Accepted Answer

A Letter of Intent is a non-binding agreement that outlines the proposed deal: price, structure, payment terms, exclusivity period, and timeline. Once signed, it triggers due diligence and locks the seller out of talking to other buyers for a defined period. LOIs are not legally binding on price, but they set the anchor for the rest of the negotiation.

Question 41

What is a quality of earnings report?

Accepted Answer

A quality of earnings (QoE) report is an independent third-party analysis that verifies and normalizes EBITDA. It confirms revenue is sustainable, margins are real, add-backs are defensible, and earnings are not propped up by one-time events. For deals above $1M in EBITDA, buyers almost always commission one. Sellers who get a sell-side QoE in advance often defend their price more effectively.

Question 42

What is working capital in a business sale?

Accepted Answer

Working capital is current assets minus current liabilities. In most deals, the buyer requires a 'normal' level of working capital to remain in the business at closing so it can keep operating. If actual working capital at closing is below the target, the purchase price gets adjusted down. This is one of the most commonly misunderstood pieces of a deal.

Question 43

What is an earnout?

Accepted Answer

An earnout is a portion of the purchase price paid after closing, contingent on the business hitting agreed performance targets. Earnouts bridge valuation gaps and reduce buyer risk, but they introduce post-close complexity. They work best when the seller stays involved and the targets are simple and measurable.

Question 44

What is seller financing?

Accepted Answer

Seller financing is when the seller agrees to receive part of the purchase price over time, typically in the form of a promissory note. It can make a deal more attractive to buyers and may increase the headline price, but it leaves the seller carrying risk. Most healthy small business deals include 10 to 20 percent seller financing.

Question 45

What is the difference between an asset sale and a stock sale?

Accepted Answer

In an asset sale, the buyer purchases specific assets (equipment, contracts, goodwill) and leaves liabilities behind. In a stock sale, the buyer purchases the legal entity itself and inherits everything, including liabilities. Buyers usually prefer asset sales; sellers usually prefer stock sales. The tax treatment is meaningfully different on each side.

Question 46

What is a data room?

Accepted Answer

A data room is a secure digital folder where the seller stores financials, contracts, employee records, and other documents for the buyer to review during due diligence. A well-organized data room shortens diligence, builds buyer confidence, and reduces last-minute price negotiation. A messy one invites scrutiny and slows the deal.

Question 47

What is customer concentration and why does it matter?

Accepted Answer

Customer concentration measures how dependent your revenue is on your largest customers. If one customer represents 30 percent or more of revenue, buyers see real risk and pay less. Diversifying revenue across more customers is one of the highest-ROI changes you can make in the years before a sale.

Question 48

What does Rowan do?

Accepted Answer

Rowan helps owners of industrial and blue-collar businesses prepare, value, and sell their companies. We combine 1:1 advisory with AI-powered tools that handle the operational and financial cleanup most owners never get around to. The goal is simple: get more owners to a successful, well-priced exit.

Question 49

How is Rowan different from a traditional business broker?

Accepted Answer

Brokers focus on the transaction. Rowan focuses on preparation first, then the transaction. We work with owners months or years before going to market to clean up financials, reduce owner dependence, document operations, and deploy AI agents that improve the business. By the time the company hits the market, it sells for more and closes faster.

Question 50

Who does Rowan work with?

Accepted Answer

We work with owners of U.S. industrial, manufacturing, construction, fabrication, distribution, and energy businesses. Most of our clients are owner-operators with $1M to $20M in revenue who are thinking about a transition in the next 1 to 5 years.

Question 51

How much does Rowan cost?

Accepted Answer

Pricing depends on what you need: a free directional valuation and readiness quiz, a paid preparation engagement, or a full sell-side advisory engagement. The best first step is to use the free valuation tool to see where you stand, then have a conversation about what makes sense from there.

Question 52

Does Rowan help buyers too?

Accepted Answer

Yes. We help aspiring owners source, evaluate, and acquire industrial businesses. Our buyer process includes matching, deal review, diligence support, and transition planning, so you step into ownership with structure instead of chaos.

Question 53

How do I get a free business valuation from Rowan?

Accepted Answer

Use our free instant valuation tool at trustrowan.com/valuation. You answer a short set of questions about your business and you get a directional value range, growth insights, and an idea of where you stand relative to comparable companies.

Question 54

What is the Exit Readiness Quiz?

Accepted Answer

It is a free 5-minute quiz at trustrowan.com/quiz that scores how prepared your business is for a successful sale across financial, operational, and leadership dimensions. You leave with a clear sense of what is working and the top two or three things to fix first.

Question 55

How do I get in touch with Rowan?

Accepted Answer

The fastest way is to email hello@trustrowan.com or use the contact form at trustrowan.com/contact. If you are exploring a sale or just want to know what your business is worth, start with the free valuation; it usually leads to a more productive first conversation.

Answers for buyers, sellers, and owners

Selling Your Business

Business Valuation and EBITDA

Buying a Business

Exit Planning and Succession

Deal Process and Due Diligence

Working with Rowan

Answers for buyers, sellers, and owners

Selling Your Business

01How do I sell my small business?

02How much can I sell my business for?

03How long does it take to sell a business?

04Should I use a business broker to sell my business?

05How do I sell my business without a broker?

06How do I get my business ready to sell?

07Should I sell my business and retire?

08What taxes will I pay when I sell my business?

09What is the best time of year to sell a business?

10Can I sell my business if it is losing money?

Business Valuation and EBITDA

01How much is my business worth?

02What is a business valuation?

03How do you calculate business valuation?

04What is EBITDA?

05What is the difference between EBITDA and SDE?

06What is a good EBITDA multiple?

07How are EBITDA multiples determined?

08How much does a business valuation cost?

09How can I increase my business valuation before selling?

10What are add-backs and why do they matter?

Buying a Business

01How do I buy a business?

02How much money do I need to buy a business?

03How do I buy a business with no money down?

04How do I get an SBA loan to buy a business?

05Should I buy a business or start one from scratch?

06What is the biggest risk when buying a small business?

07How do I know if a business is priced fairly?

08How long does it take to buy a business?

09What should I look for in a manufacturing or industrial business?

Exit Planning and Succession

01What is exit planning?

02When should I start exit planning?

03What is a business exit strategy?

04How do I plan a business exit?

05What is succession planning?

06What is the difference between exit planning and succession planning?

07What is a family business succession plan?

08How do I value my business for succession planning?

09What does an exit planning advisor do?

Deal Process and Due Diligence

01What is due diligence in a business sale?

02What is a Letter of Intent (LOI)?

03What is a quality of earnings report?

04What is working capital in a business sale?

05What is an earnout?

06What is seller financing?

07What is the difference between an asset sale and a stock sale?

08What is a data room?

09What is customer concentration and why does it matter?

Working with Rowan

01What does Rowan do?

02How is Rowan different from a traditional business broker?

03Who does Rowan work with?

04How much does Rowan cost?

05Does Rowan help buyers too?

06How do I get a free business valuation from Rowan?

07What is the Exit Readiness Quiz?

08How do I get in touch with Rowan?