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If you want to sell a car or a house, you know it’s far more likely to attract buyers if it’s well-presented, in good working order, and priced realistically. The same principle applies when selling a business. Too often, when I meet with business owners, they believe they are ready to go to market immediately. In reality, many would be in a far stronger position if they had taken steps well in advance to prepare their business for sale.

If an owner is seeking to sell a highly profitable business. At first glance, the figures appear impressive—turnover and profit have doubled over a nine-month period following the award of a new contract. However, closer examination shows a history of significant fluctuations in both revenue and profit, largely tied to contracts being won and lost. The business could also depend heavily on the owner’s personal involvement, particularly in driving new business. This introduces risk for a potential buyer. While there is clear potential for continued growth, there is also a possibility that key contracts may not be renewed, leading to a decline in performance. Without the current owner’s involvement, the future trajectory of the business is less certain for the buyer, sellers need to reduce the business’s dependence on them.

If you are planning to sell your business, it’s essential to create a structured plan—often over several years. Many entrepreneurs excel at building and running businesses but benefit from expert guidance when preparing for an exit. That’s where Weybrook Business Brokers can help, offering tailored support to position your business for a successful sale.

Preparing Your Business for Sale: A Checklist

1. Clarify Your Motivation
Understand why you want to sell and what your plans are after the sale. This clarity will guide your decisions throughout the process.

2. Get Your Finances in Order
Buyers expect clear, accurate financial records—typically at least three years of trading accounts. Beyond that, you’ll need to demonstrate future growth potential through credible forecasts and a solid business plan.

3. Ensure Your Business Is Sale-Ready
To make your business attractive and transferable to a new owner, consider the following:
• A strong second-tier management team capable of running the business independently
• Secure agreements with key customers and suppliers
• A clear shareholder structure and agreements
• Evidence of consistent, sustainable profitability
• Resolution of any outstanding legal issues
• Up-to-date documentation, including contracts, leases, trademarks, and employee agreements
In some cases, a 1–5 year preparation plan may be required to achieve this.

4. Decide How You Will Sell
Selling a business is complex and time-consuming. Attempting to manage the process alone can distract you from running the business, potentially affecting performance and value.
It’s advisable to assemble a team of experienced professionals, including:
• An accountant or finance director
• A business broker to market the business
• A commercial lawyer to handle legal matters

Throughout the process, your priority should remain on maintaining strong business performance, while your broker focuses on finding the right buyer.

I hope you found this guide helpful. If you’d like support in preparing your business for sale or developing a tailored exit plan, Weybrook Business Brokers offers a range of services to help you achieve the best possible outcome.

Contact – Rupert Trevelyan rupert@weybrookbusinessbrokers.com or call 07826 050690

When you’re in business with others, clarity isn’t optional—it’s critical. Without it, disagreements can surface quickly and become costly distractions.

Shareholder relationships change over time. A founder may find themselves dealing with a minority shareholder who is no longer involved in the business but wants to sell their shares.

Without clear rules, this creates uncertainty and risk. Shares could be sold to third parties, or even competitors -leaving the business exposed. At the same time, there may be no agreed way to value those shares, making it difficult to reach a fair outcome.

Even where the company or existing shareholders want to step in and buy the shares, price often becomes a sticking point.

Minority shareholdings are usually worth less due to their lack of control and limited marketability. However, that rarely aligns with the seller’s expectations. The result is often a deadlock, with one party pushing for a higher price and the other unwilling to overpay, especially where no valuation framework exists.

In more serious cases, a single disgruntled shareholder can disrupt decision-making or even block a sale entirely.

The Solution
A well-drafted Shareholders’ Agreement brings certainty and control from the outset.

It clearly defines how decisions are made, what requires joint approval, and what can be handled independently. It sets out how shares can be transferred, who they can be sold to, and whether existing shareholders have priority.

It also establishes a clear approach to valuing shares, reducing the risk of disputes at critical moments.

In addition, it protects shareholders during a sale through mechanisms such as drag-along and tag-along rights, and deals with exits by setting out how shares are treated when someone leaves the business.
Put simply, it replaces uncertainty with structure—and potential conflict with clarity.

A Shareholders’ Agreement protects your business, your relationships, and your future plans. It ensures everyone knows where they stand and helps avoid costly disputes down the line.

If you want to sell your business contact Rupert Trevelyan – rupert@weybrookbusinessbrokers.com or call 07826 050690

When selling your business, it would be ideal to receive the full payment in a single transaction on the day of completion. In reality, however, this is uncommon. Most acquisitions are structured with payments made in instalments over time.

There are several reasons for this. Buyers aim to minimise their risk—just as sellers do—and in many cases, they may not have sufficient cash available to complete the purchase outright. As a result, they often need to secure funding from a variety of sources.

Funding
At the level at which we typically operate, buyers tend to finance acquisitions through a combination of debt and equity:

Debt / borrowing sources
Loans from banks and specialist finance providers
Peer-to-peer lending platforms
Crowdfunding
Seller financing (vendor loans)

Asset / cash investment
The buyer’s own capital
Investment from third parties, such as angel investors and venture capital firms
Asset-based contributions or swaps

Instalments
Generally, the higher the purchase price, the more likely it is that payments will be spread over time. Typically, an initial payment of 50–60% is made upfront, although in some cases this can be as high as 75%.

The remaining balance is paid at agreed intervals, as set out in the sale and purchase agreement—often every six or twelve months. These deferred payments may sometimes be linked to performance criteria. While such conditions can be justified in certain cases, we generally advise caution, as the seller may no longer have control over the business’s performance post-sale. Ultimately, this is a matter for negotiation and will vary from deal to deal.

In most cases, a longer payment period may result in a higher overall sale price, whereas a shorter timeframe typically leads to a lower agreed value. However, immediate funds are more certain than future payments, so we generally favour larger upfront instalments and shorter completion periods.

If you would like to discuss this further, please get in touch:
rupert@weybrookbusinessbrokers.com or 07826 050690

Once you have accepted on offer for your business which usually takes the form of a signed Heads of Terms document produced by the buyer’s solicitors, the next step is to engage (if you haven’t already) a good commercial lawyer experienced in business sales. (note this not your family solicitor)

Typically, this process takes 12-16 weeks, but can be quicker or in complicated transactions occasionally it takes longer.

You will be asked a significant number of questions and to supply answers and data which can be held in a secure data room approved by your lawyer.

The preparation you should consider is listed below for SME sellers in the UK preparing for due diligence This is structured around what buyers and their advisers will scrutinise most:

1. Financial Readiness
• Clean, accurate accounts (ideally 3+ years)
• Management accounts up to date (monthly/quarterly)
• Clear revenue breakdown (by product, customer, geography)
• Documented EBITDA and adjustments
• Cash flow visibility and working capital trends
• Consistency between filings (e.g. HM Revenue & Customs and Companies House)

2. Legal & Corporate Structure
• Group structure chart (subsidiaries, holdings)
• Articles of association and shareholder agreements
• Share ownership
• Board minutes and key resolutions
• Any past or ongoing disputes/litigation

3. Tax Compliance
• Corporation tax filings complete and up to date
• VAT compliance (returns, registrations, cross-border issues)
• PAYE and National Insurance properly handled
• Any ongoing or past tax investigations
• Clarity on tax reliefs (e.g. R&D claims)

4. Commercial & Revenue
• Top customers
• Signed contracts and terms of business
• Recurring vs one-off revenue split
• Sales forecasts
• Customer data

5. Key Contracts & Obligations
• Supplier and distributor agreements
• Lease agreements (property, equipment, vehicles)
• Loan agreements. Change-of-control clauses (critical for a sale)
• Insurance policies
6. People & HR

• Employee list (roles, salaries, tenure)
• Employment contracts
• Key management details
• Bonus, commission, and incentive schemes
• Any disputes, grievances, or tribunal risks

7. Intellectual Property (IP)
• Ownership of IP by the company
• Trademarks, patents, and registrations documented
• Software/code ownership (especially if contractors used)
• Any infringement risks or disputes

8. Technology & Operations (if relevant)
• Overview of systems and infrastructure
• Cybersecurity policies and past incidents
• Data protection compliance (GDPR)
• Business continuity and disaster recovery plans

9. Regulatory & Compliance
• Industry-specific licenses or approvals
• Health & safety compliance
• Environmental considerations (if applicable)
• Data privacy compliance (UK GDPR / ICO expectations)

10. Red Flags to be Prepared to Answer
• Inconsistent financials or unexplained adjustments
• Missing contracts or undocumented agreements
• Founder-dependent relationships
• Tax exposure or aggressive accounting
• Weak internal controls

11. Practical Preparation Tips
• Build a virtual data room early (well-structured folders) This may well transfer to the lawyers after Heads of Terms are signed
• Ensure documents are consistent, labelled, and current
• Prepare a Q&A log for likely buyer questions
• Align your accountant, lawyer, and any other advisers including your Business Broker

One of the things I enjoy most about what I do is working alongside inspiring entrepreneurs who’ve built truly great businesses.

Just this week, we completed the sale of a well-established and profitable international matchmaking business. While its excellent reputation certainly helped, that alone didn’t secure the deal. What gave the buyer real confidence was its consistent profitability, a solid fee structure providing reliable income, and a strong team — including a general manager who will remain in place to support future growth.

Too often, when I speak with business owners considering a sale, they place significant value on the years of hard work, dedication, and sacrifice they’ve invested. While that commitment is admirable, it doesn’t directly translate into sale value. Buyers are focused on clear fundamentals: growing revenue, increasing profits, and a capable team that can sustain the business beyond the owner’s exit.

If you’re thinking about selling your business, I’m always happy to have an initial, no-obligation conversation. I’ll give you an honest assessment of its current saleability — and in many cases, it’s worth putting a 3–5 year plan in place to maximise value before going to market.

My contact details are: rupert@weybrookbusinessbrokers or +44 7826050690

Selling your business can be stressful. Letting go and handing control to a new owner is often an emotional experience. During the sale process, pressure can build quickly, with you and your team required to answer challenging questions and provide large volumes of information.

On several occasions I’ve had to defuse tense situations to ensure a smooth handover. The key is preparation and acceptance. Recognise that selling your business is likely to be emotional, and try not to take buyers’ questions or their advisers’ scrutiny personally. They are simply doing their job. For them, acquiring your business may represent a significant financial risk, and the pressure to make the right decision can be intense.

There are several steps you can take to make the journey smoother. Firstly plan well in advance and ensure your business is fit for sale, ensuring:

• It is profitable and generates strong cash flow
• It demonstrates growth with a solid level of recurring revenue
• It has a strong management team and workforce
• All contracts and legal documentation are current
• Financial accounts and records are fully up to date
In addition:
• Make sure all shareholders are aligned and committed to selling
• Appoint experienced advisers (a commercial lawyer, accountant, and broker) so you can stay focused on running the business
• Build a strong personal support network to help you manage stress and keep your sense of humour intact

If you are considering selling your business, contact Rupert Trevelyan at Weybrook Business Brokers on 07826 050690.

Buyers of UK SMEs are placing greater emphasis on due diligence than previously. Economic uncertainty, tighter funding conditions and regulatory scrutiny mean acquirers want a clear, evidenced understanding of risk before committing capital. As a result, deals are taking longer, questions are more detailed, and assumptions are being challenged earlier in the process.

To prepare, businesses should treat due diligence as a discipline to prepare for if they are looking to sell their business rather than a last-minute exercise. Be prepared! Financial information must be accurate, consistent and well explained, with clear visibility over revenue quality, margins, working capital and cash flow. Legal and compliance matters—contracts, employment terms, IP ownership, data protection and regulatory obligations—should be up to date and easily accessible. Buyers are also focusing more on operational resilience, customer care, supplier relationships and the strength of the management team.
Practical preparation includes maintaining up to date data and financial documents, documenting key processes, addressing known weaknesses early and being ready to explain performance drivers and risks with confidence.

Businesses that invest time in getting “deal-ready” not only reduce friction and pain during due diligence, but also build credibility with buyers—often leading to smoother negotiations, stronger valuations and a higher likelihood of completing the transaction.

If you want to talk through selling your business contact Rupert Trevelyan of Weybrook Business Brokers for a no obligation discussion https://www.weybrookbusinessbrokers.com/contact-us/

EBITDA Valuation of a business

Valuing a business using EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortisation) is a widely accepted and commonly used profit-based valuation method.

Adjusted EBITDA
When using EBITDA for valuation purposes, it is essential to calculate an “Adjusted EBITDA” figure. This process involves making normalising adjustments, including relevant add-backs, to present a more accurate reflection of ongoing operational profitability. Typical adjustments may include:
• Owner’s pension contributions, salary or bonuses that do not reflect market value
• Building expenses, repairs or maintenance expenses that should have been capitalised (e.g., improvements or office remodelling)
• Exceptional non-recurring or one-off expenses, such as legal or professional fees, donations, employee bonuses, or intellectual property costs (e.g., patents, trademarks)
Applying the EBITDA Multiple
Once the Adjusted EBITDA is calculated, a multiple is applied to derive the business’s value (or expected return if shares are sold).

This EBITDA multiple is typically based on industry averages, drawn from transaction data involving similar-sized businesses. For small to medium enterprises (SMEs), multiples often range between 2 and 5, but may reach 7 or 8, especially if a strategic purchaser is involved. In such cases, the buyer may be willing to pay a premium due to synergies or strategic advantages.
The actual multiple applied will depend on several factors—most notably market conditions, and growth potential.

Influences on Value
While the saying “higher risk, higher return” holds true for investors, in business valuation, lower risk translates to higher value. As such, valuation professionals closely assess the following risk factors, which can significantly influence the multiple used:
Factors that can enhance value:
• A turnkey /strong and independent management team
• Low reliance on the owner for day-to-day operations
• Blue-chip or well-diversified customer base
• Good revenue spread (No single customer contributing more than 10% of total revenue)
• High proportion of repeat revenue or contracted business
• Long-term contracts with suppliers and/or customers
• Operation in a niche or high-growth market
• Unique or hard-to-replicate offerings
• Low levels of competition
• Strong reputation
• Consistent revenue and profit growth
• Recognised accreditations or formal management systems

When assessing the value of a business, it’s essential to scrutinise both:
1. The adjustments made (or omitted) in calculating Adjusted EBITDA, and
2. The multiple applied to that EBITDA figure.
Both must be seen as fair and reasonable—otherwise, the resulting valuation may provide a misleading impression of the business’s true worth

Newsletter July 2023

Insights from interactions this Month
After a number of base rate rises from the Bank of England and rising interest rates there is increasing caution in the market. This does not mean that there is a fall in buyer enquiries, it means buyers are applying greater levels of scrutiny to ensure that they can satisfy lending criteria. For example, one seasoned buyer has found that lenders will only make loans available up to 2 times EBITDA for target acquisitions, so he is having to put together multi supplier / source finance packages in order to complete deals.
In June we completed the sale of a wholesaler in the water treatment sector to a US based multinational. The trend at the moment is for potential buyers to come from across the globe. We have been talking to interested parties from US, Europe, India, Dubai, South Africa and the Far East.
Sectors that have been generating the most interest are building services, manufacturing and online.

Tip of the month
Sellers need to be creative and flexible when agreeing to sell their business. With the supply of finance being tight sellers may need to agree to an installment payment plan over an agreed timescale to secure the completion of a sale. The plan could be backed warranties or guarantees.

Featured business this month
Exceptional manufacturer of traditional timber box sash windows
Operating from a factory in the heart of England this company manufactures traditional box sash windows which are simply the best on the market.

The company designs, manufactures, glazes, paints and installs custom-made traditional timber box sash windows for new-build projects, period properties, and Grade II listed buildings. Its double-glazed units are now being recommended to restorers of Grade II listed buildings by conservation officers. This puts the company in a unique position to exploit and potentially dominate supply to the timber window market which is worth c.£450 million in the UK. (there are c.500,000 listed buildings in England).
This is an exceptional company looking for an exceptional buyer.
Contact us for a no-obligation discussion about selling your business
https://www.linkedin.com/in/ruperttrevelyan/
Email: Rupert Trevelyan rupert@weybrookbusinessbrokers.com
Call +44 7826 050690

This week I have been doing valuations and talking to buyers about the asking price of some my client’s companies. I even dreamt about doing valuations, no doubt you will say that I need to get a life, but there are some triggers many of which I am familiar with.

There are buyers out there who are really keen on acquiring companies and I had 2 very long zoom calls yesterday examining the cost base of my clients and the valuation we have applied. I always tell my clients that it is essential that they continue to profitably grow their company if they want to achieve a good price, they also need to ensure that there is a strong transferable management structure in place, strong recurring revenue, shareholder agreement on the sale, an understanding of debt and how it will be treated, at the lower end many buyers prefer the target to debt and cash free.

The first caller was concerned that the profitability of the company he is looking to acquire is falling while revenue is increasing, this means the value of the company is falling, but the seller won’t accept that. Ultimately the buyer is likely to walk away, unless there is some form of price adjustment; he is willing to offer a deferred payment if things improve, but that comes with obvious risks for the seller.

The second caller was trying to get an understanding the revenue and cost implications of replace the owners of his target. The owners are a couple, they do have a team in place, but one of them is operational and works on one key sector generating a specific revenue stream, his partner runs the administration team. The buyer is astute and is working out the implications for him if he takes the business over. He is planning to make an offer but it will take into account the cost of replacing the owners.

Buyers are out there and are keen. They have added pressure that the providers of acquisition finance are still very vigilant, one buyer I am talking to spent 8 months putting together a finance package to make an acquisition, he was a week away from concluding the deal when our former prime minister and her chancellor decided to launch a budget that spooked the global market. The resultant market conditions mean buyers have to jump more and more difficult hurdles to secure acquisition finance

If you want to sell your company I am always happy to talk it through if you want to give me a call on 07826 050690