According to the Australian Bureau of Statistics (2018) the average time to sell a business is 6 to 9 months.
Ask any business broker and they will tell you that selling your business is nothing like selling your house. Your house is a static and tangible thing, while your business is an on-going and evolving entity which has many different ‘sale stages’ within the sale process. So comparing one to another is a bit like comparing an apple to an orange. They’re nothing alike! Your carwash contains physical things like plant and equipment, stock and cash on hand, employees and customers, but, it also has intangible things like its reputation and its position in the marketplace. Other factors surrounding the sale of your business is looking at how popular owning one type of business (for example a car wash) is, in comparison with owning a more commonly found business, like a convenience or retail store and how many buyers would be interested in entering into a relatively niche industry that a carwash would come under?
To help put things into perspective you need to ask yourself:
How many prospective business buyers live within an hour of your business location?
How many business buyers would relocate and move to your location?
How many of those business buyers would be interested in a niche business such as a carwash against someone else’s, and of those, how many have the financial capability to buy your business now?
The answers to these questions are certainly not in the hundreds, and are more likely to be counted on the fingers on one hand.
Another very important factor in determining the timeframe for selling a car wash business is price. Price matters. Business buyers are interested in the profit a business makes from doing what it does. Their view on the asking price will be largely based on how strong and consistent the profits are and how long are they going to be reliable into the future. If you get your selling price wrong most business buyers will discard your offer to sell. Furthermore, it is vitally important to have all your financial information and business documents up to date so a valuation can be undertaken to realistically price the worth of your business. Failure to have these documents in order will add additional time in which it takes to sell your business, and in some instances can add another 3-6 months to the process.
Once you have an interested buyer, you then need to allow at least 2-3 months for them to evaluate the information, perform due diligence and source their finance, so you will need to be prepared for the time it takes for them to engage their own professionals to perform these vital steps. It’s important to note with tighter bank restrictions on lending, that many loan requests are falling through so even if you have a buyer lined up, financing could be an issue. Because of this it’s a good idea to keep your advertising active until the settlement has taken place.
It would be unrealistic to think that you could sell your business in the same timeframe as selling your house as there are many variable factors associated with a business sale. Factors including the popularity of the industry in which your business comes under, the pool of perspective buyers, the price, and the due diligence undertaken by potential purchasers all contribute to (in comparison to a house) a longer timeframe which on average is around 6-9 months.