Excellent question. The short answer is: now.
When do you want your business to be at its healthiest? My advisor answer, and honestly, my owner answer, is today. Even if you’re 20 years from selling, the habits that make a business easier to sell also make it more profitable and efficient to run.
It’s like exercise. You’re better off building healthy habits all year than waiting until January to crash diet for spring break.
What if I plan to sell in the next few years?
Don’t panic if you haven’t done everything perfectly. In my experience, buyers often focus most closely on the past three to five years of financials. But don’t assume older expenses will disappear or automatically qualify as addbacks. Keep clear records, and we can help you understand which adjustments a buyer is likely to accept.
Should I replace old equipment before selling?
Not automatically. If a key machine is 20 years old, the buyer will want to know its condition, maintenance history, and replacement cost. You could replace it or disclose the need and account for it in the deal.
I often prefer to help the buyer understand their options before recommending a replacement. They may want a different model with more capacity or features, even if it costs $300,000 more. If you share what you know about the equipment, service plans, and production capacity, you’re helping the buyer make a good decision. That builds goodwill—and gives them a better handoff than an unexpected repair bill.
Should I keep making discretionary purchases?
You don’t need to stop making choices that matter to you. Charitable giving and other discretionary expenses don’t automatically mean you’re running the business poorly. Some expenses may support an addback; others may not. We’ll look at them carefully and help you present the numbers clearly.
For Indiana business owners, preparing to sell doesn’t have to mean putting the business on hold or spending money just to make it look better. Whether you’re thinking about selling next year or decades from now, start by building a stronger business today. We can help you decide what to address, what to explain, and what can wait.
Jeremiah Morton, Business Broker
