75+ Questions to Ask When Selling a Business

The process of selling a business is both challenging and thrilling. As a founder or business owner, you've put in several years of hard work into your company to get to a point where you can sell it. 

But you have only one chance to get it right amidst the challenges and thrills of the selling process, both of which can prevent a successful exit. 

One way to navigate the process well is to ask lots of questions, starting with yourself, before asking your buyer, M&A advisor, employees, CPA, and M&A attorney. 

Making a checklist of all the important questions will take a lot of work, and we at Exitwise can help you hire and manage an elite team of M&A experts. Consult our M&A advisor for free to get started. 

Why is it Crucial to Ask Questions Before Selling a Business?

Asking the right questions before you sell your business can make all the difference between a successful and a failed exit. 

Here's why you'll want to ask plenty of questions:

You'll Involve the Right Experts

If you need help with the sale, you can hire the right experts, such as M&A attorneys, business brokers, and tax accountants. 

Since you'll suddenly come into a lot of money, you'll also need a wealth advisor to help you figure out ideal ways to use the money. 

You'll Get the Sale Right 

You only have one chance for a great sale, and the right questions can help you avoid costly mistakes. 

For example, a deep understanding of what buyers need before and after the sale will protect your legacy. Your buyer will acknowledge your commitment to a healthy relationship and successful sale that caters to your interests and theirs. 

Chances of a Satisfying and Successful Sale Are Higher

Even if you sell your business successfully, you may not be satisfied with the whole process. Asking questions can shape the path to a sale that leaves you happy. 

You Save Everyone Time and Money

You'll save time and money for yourself and other players in the sale process since you can see their motivations and commitments. 

The right questions asked in the right manner will show you where to spend your time. For example, if you notice a certain buyer isn't a good fit from the start, you won't have to spend any more of your valuable time trying to convert them. 

You Build Trust and Credibility

Just as you want to work with potential buyers and M&A experts worth their salt, the reverse also applies. Every stakeholder in the sale process wants to work with a seller they can rely on and trust. 

Asking the correct questions shows your buyers and M&A experts that you are knowledgeable, experienced, and willing to go the extra mile to achieve a successful transaction. 

You Get to Adjust Your Strategy

If you can't adequately or honestly answer most of the questions, consider modifying your questioning approach or the exit strategy altogether. You may have to hold a little more until you are better prepared. 

You Protect Your Business Goals and Legacy

Selling your business involves more than just the sale price. You also need to ensure the sale aligns with your business goals and maintains the legacy of your business. 

Questions to Ask Yourself During this Process

For most founders and business owners, selling a business is one of the most important financial, personal, and professional decisions they'll ever make. 

As such, the more deliberate and honest you are in your path forward, reasoning, and thinking, the better the sale outcome and the happier you will be. 

Here's what to ask yourself:

1. Why am I selling?

2. What are my financial goals?

3. Have I considered the timing?

4. How will this impact my life and plans?

5. How will I value my business?

6. Am I ready to let go emotionally?

7. What will happen to my employees?

8. Have I identified potential buyers?

9. What terms will I accept?

10. How will I manage the transition?

If you can map the right path forward based on your honest answers, you'll have an easier process, making it easy for M&A experts and buyers to work with you. 

Questions to Ask Potential Buyers

Asking potential buyers questions is a great way to screen, shortlist, and qualify them. The exercise helps you determine whether their interests are genuine and aligned with yours, which is crucial for ensuring your business's legacy continues. 

Additionally, you can tell from the start if a certain buyer is a good fit based on their financial capacity. You want to avoid going through a detailed process only to find out when it's too late that they can't afford the business, even with M&A financing. 

Be sure to ask the following questions:

11. Why are you interested in buying my business?

12. What experience do you have in this industry?

13. How do you plan to finance the purchase?

14. What are your short-term and long-term plans for the business?

15. How do you intend to maintain the business culture?

16. Will you retain the current employees?

17. What changes do you plan to implement?

18. How do you evaluate the business’s value?

19. Can you provide references from other business transactions?

20. What is your timeline for completing the purchase?

21. How will you handle existing contracts and agreements?

Besides checking out the answers to these questions, consider how the buyer and their team answer them. Read between the lines or listen keenly to determine their level of confidence and assuredness and the probable ease of working with them.

Questions to Ask an M&A Advisor

When selling your business, it is advisable to work with an M&A advisor right from the start to leverage their industry knowledge and pool of potential buyers.

To find the best M&A advisor, you'll need to interview them to learn more about them, their industry knowledge, past success, and ease of working with them.

Here's what to ask the advisor:

22. What experience do you have in my industry?

23. Can you provide references from clients?

24. How do you evaluate a business's value?

25. What is your success rate in sales?

26. How will you market to buyers?

27. Can you explain the M&A process?

28. How will you handle confidentiality?

29. What strategies attract qualified buyers?

30. What is your sale timeline?

31. How will you assist in negotiations?

32. What businesses have you sold recently?

33. How will you keep me informed?

34. What post-sale support do you offer?

While looking for an M&A advisor yourself, you can save time and money working with us at Exitwise. We will help you find, interview, hire, and manage the best advisors based on your specific needs.

Reach out to our team today to get started with the process of finding and managing the best M&A advisor and other experts.

Questions to Ask Your Attorney

At Exitwise, we also help you hire and manage knowledgeable and experienced M&A attorneys to help you with all the legal aspects of selling your business.

Here's what you'll want to ask your M&A attorney:

35. What experience do you have with business sales and acquisitions?

36. Can you explain the legal steps in selling my business?

37. What documents will I need during the sale process?

38. How will you ensure my interests are protected?

39. What are the common legal pitfalls in selling a business?

40. How do you handle confidentiality agreements?

41. What are the tax implications of selling my business?

42. How will you assist in drafting and reviewing the sale agreement?

43. How will you handle potential legal disputes?

44. What terms and conditions should I be aware of in the sale agreement?

45. How will you coordinate with accountants and M&A advisors?

46. What liabilities should I be aware of after the sale?

47. How will you ensure regulatory and compliance issues are addressed?

Finding an M&A attorney who can conclusively answer these questions isn't enough. Be sure to listen keenly to tell if they are easy to work with and genuinely interested in helping you protect your business goals and legacy.

Questions to Ask Your Team/Employees

Your employees know your business inside-out and are well-placed to help you identify crucial aspects of the sale that you might have missed.

For example, they can tell you the biggest strengths of the business, which you can leverage to get a higher sale price.

Here's what you'll want to hear from your team:

48. How do you feel about the potential sale of the business?

49. What concerns do you have about the transition?

50. What aspects of the business do you think are its biggest strengths?

51. Are there any areas of the business you believe need improvement?

52. What are your career goals, and how can they be supported post-sale?

53. What suggestions do you have for making the transition smooth?

54. Are there any processes or systems you think should be preserved?

55. How would you describe the current company culture?

56. What would you like to see in a new owner or management team?

When it’s the right time to tell your employees about the sale, remember to listen to their opinions and concerns. It's in your best interests to ensure they are happy during and after the sale because you want to preserve your legacy.

Questions to Ask Your CPA

A certified public accountant is a crucial M&A team member to hire right from the start. They can help you understand the financial status of your business and the importance of the quality of your earnings in maximizing business value.

Here's what to ask your CPA:

57. How should I prepare my financial statements for a sale?

58. What are the tax implications of selling my business?

59. How will the sale affect my personal finances?

60. What strategies minimize tax liability?

61. What’s the difference between an asset sale and a stock sale for taxes?

62. What are the potential hidden costs of selling my business?

63. How should I handle debts and liabilities before the sale?

64. What financial records do buyers need to see?

65. How can I make my business more financially attractive?

66. What role will you play in due diligence?

67. How should I report the sale on my tax return?

68. What are the implications of deferred payments or earn-outs?

Another critical reason to hire the right CPA is to have them help you decide on a deal structure with the most favorable tax implications.

A CPA can also show you how to avoid taxes when you sell the business, which can significantly increase your take-home amount.

Pre-Sale Preparation Questions

There are many general questions to ask yourself when preparing for the sale. These cut across the board from increasing the value of the business to the welfare of your employees and customers.

69. What steps should I take to prepare my business for sale?

70. How can I improve my business’s financial health before selling?

71. Are my records and financial statements up to date?

72. What legal issues should I address before the sale?

73. How should I evaluate current market conditions?

74. What investments or improvements increase the business's value?

75. How can I ensure my intellectual property is protected?

76. What should be included in a business plan for buyers?

77. How should I handle existing contracts or agreements?

78. What should I do to prepare my employees for the transition?

79. How can I enhance customer relationships and loyalty before selling?

The good thing about this stage is that you don't have to go through it alone. You can work with us at Exitwise to hire M&A experts to help you. The experts will even help you determine the necessary steps to improve the value of your business.

Post-Sale Questions

What happens after a business sale is highly important and can make or break your legacy.

The questions below will help you understand your post-sale responsibilities to the new owner and the former customers and employees.

80. How will the sale proceeds be distributed?

81. What are the tax implications post-sale?

82. How will I handle any remaining liabilities?

83. What is my role during the transition period?

84. How will the new owner manage existing employees?

85. What will happen to current customer contracts?

86. How will I transfer intellectual property?

87. What should I do with the remaining business assets?

88. How will I invest or use the sale proceeds?

89. Are there any ongoing legal responsibilities?

90. How do I inform stakeholders about the sale?

Another critical post-sale aspect you shouldn't overlook is what you'll do with the sale proceeds. Receiving such a huge amount with a poor plan can mean losing it all in no time. 

Conclusion

While this is a highly detailed list of the fundamental questions to ask to inform your business sale decisions, it's not conclusive.

An M&A team can help you uncover many other crucial questions. At Exitwise, we’ll ensure you hire the right team that will help you ask the right questions and make a successful sale.

You can consult our M&A advisor for free about setting up your dream team to help you understand each stakeholder properly and prepare you for a satisfying sale at the best price.