Time Line for Buying A Business

How long does the process take to buy a business?

The process to buy a business is a detail intensive exercise and can vary widely depending on the situation and type of business. If you want to buy a manufacturing business your process will vary greatly as compared to buying a restaurant. Here are the various stages with some time estimates (not every situation will have all of the elements below and some circumstances could have more steps). This typical time estimate starts after you’ve identified a business you’d like to try to buy:

  • Initial meetings with seller to learn general information about the business – 2 weeks
  • Research the Industry – 1 week
  • Negotiate contingent offer based on financial and other information provided by Seller – 1 week
  • Full Diligence – 3 – 4 weeks (total for items below)
  • Buyer and Seller negotiate and agree on final closing documents: – 2 – 3 weeks
    • Training and Consulting agreement Seller will provide buyer
    • Non-compete agreements
    • Representations, Warranties and Indemnification clause
    • Purchase and Sale Agreement
  • Closing – Final agreements signed, buyer and seller exchange funds and business turned over to buyer