How to get a Main Street business ready to sell

Getting a Main Street business ready to sell is three jobs: the books, the owner’s role, and the lender. Do them before you go to market, because diligence is a bad time to find out the cash flow does not support the price.

Start with the books. Tax returns tell the IRS what you paid. A buyer and a bank need to see what the company actually earns. Recast the numbers so add-backs are documented. Separate personal expenses. Identify one-time work. Explain related-party leases and owner compensation in writing. If you cannot walk a stranger through twelve months of cash, you are going to have a hard time in diligence.

You do not need a novel. You need statements a lender will trust, a simple quality-of-earnings story, and a working-capital picture that does not surprise anyone at the table. The earlier this is clean, the less the price moves later.

Then get the owner out of the middle of the work. If estimates, hiring, vendor fights, and the biggest customers all run through you, the buyer is purchasing a person. Cross-train. Write down how a job moves. Name who calls the customer. Put the CRM, the estimating files, and the calendar where someone else can run them for two weeks while you are out. You will not be gone on day one after close, and you also should not be the only person who knows how the company lives.

Then make it lender-ready. For companies in this range, Main Street and lower-middle-market up to $20mm enterprise value, most closes need financing. SBA and conventional lenders look at cash flow, collateral, concentration, and whether the business survives a leadership change, and they look at that before they care about your story.

Have experienced lenders review the file before launch. If the debt cannot support the price, you want that answer in prep, not after a buyer is attached to a number you cannot finance. Structure is part of readiness: cash, a seller note, an earn-out, working capital. You can get creative on structure, but you cannot surprise people at the table.

A short list, in order:

• Recast financials and a written add-back schedule.
• Documented operations. Who does what, on which tools.
• Customer and vendor concentration, stated plainly.
• Equipment, leases, licenses, and any real estate that travels with the deal.
• A working-capital target you can defend.
• A lender who has seen the file before the teaser goes out.

Do this in Washington, Tennessee, or anywhere we sell. The work does not change with the zip code. The buyer still has to finance it, and the company still has to run when you step back.

We lead every engagement ourselves: valuation, prep, lender review, buyer search, diligence, close. If the company is not ready, we will tell you what would make it ready. If it is, we will take it to market like a transaction.

Start with a confidential, no-obligation valuation from a founding partner.