The best time to sell is when performance is stable or rising – Not when it’s declining or uncertain. Buyers buy the future—not your past – even a 25-year legacy won’t offset recent financial decline.
🔒 Confidential Case Study : When a Good Business Becomes Hard to Sell“
I was getting offers… but none of them felt right.
”This is one of the most important (and difficult) realities sellers need to understand.
A wellness clinic owner (25+ years in operation) approached with :
• Established reputation
• Long-term therapists (some 10–15+ years)
• Consistent client demand and waitlists
• Minimal owner involvement in recent years
On the surface?
👉 A very sellable business.But what unfolded during the process is something every seller should pay attention to.
📍 Initial Position
The business had :
• ~4–5 treatment rooms + additional convertible space
• Multiple practitioners (RMT + other services)
• Semi-absentee ownership
• Strong community goodwill
We positioned it based on :
• Normalized earnings (SDE approach)
• Add-backs (owner compensation + discretionary expenses)
• Stability of staff and clientele
👉 The story was strong. Interest came in
📉 What Changed During the Sale Process
This is where things started shifting.
1. Declining Financial Performance
• EBITDA started trending downward year-over-year
• Key contributors (therapists) were temporarily unavailable
• Certain service lines had interruptions
👉 Buyers noticed this immediately.
And more importantly…
👉 Lenders noticed this even faster.
2. Mismatch Between Expectation vs. Reality
The seller was anchored to :
• Historical performance
• Add-backs that buyers couldn’t fully justify
• Emotional value built over decades
But buyers were looking at :
• Current earnings
• Risk of further decline
• Replacement cost of staff
👉 Result: valuation gap widened.
3. Buyer Pool Narrowing
Initially:
• Multiple interested buyers
• Conversations progressing toward offers
Over time:
• Buyers started dropping off
• Remaining buyers revised expectations downward
• Some walked away entirely
👉 This is very common—and very avoidable.
4. Pressure to “Bridge the Gap”
At one point, expectations emerged that :
• The advisor should “make the deal work”
• Buyers should stretch beyond comfort
• Gaps could be negotiated without fixing fundamentals
But here’s the reality:
👉 No advisor can fix declining numbers with negotiation alone.
⚠️ Where the Deal Stands Now
• A few buyers remain—but with lower offers and stronger conditions
• Confidence has reduced due to performance volatility
• Financing feasibility is tighter • Deal risk has increased significantly
👉 At this stage, the transaction is uncertain and may not close.
🧠 Critical Lessons for Sellers
This case is not about failure—it’s about timing and preparation.
1. Your best time to sell is when performance is stable or rising
Not when it’s declining or uncertain.
2. Buyers buy the future—not your past. Even a 25-year legacy won’t offset recent financial decline.
3. Staff dependency is a real riskIf key revenue generators leave or pause :
👉 Your valuation drops instantly
4. Add-backs must be defensibleIf buyers (or lenders) can’t verify them :
👉 They won’t count them
5. The market doesn’t wait
While you “test the market”
• Numbers can change
• Buyer sentiment can shift
• Momentum can be lost
🔄 What Could Have Changed the Outcome
With hindsight, a stronger exit could have been achieved by :
• Stabilizing revenue for 6–12 months before going to market
• Locking in key staff (contracts, retention plans)
• Improving financial reporting clarity
• Aligning pricing with lender-backed valuation early
👉 Small improvements = big difference in outcome
🤝 Final Thought
This is still a good business.
But “good business” does not always mean :
👉 “sellable at the expected price, at the expected time.”
If you’re a business owner thinking
• “Maybe I’ll sell in the next year or two…”
• “Let me test the market and see…”
Pause.
Because the difference between :
👉 A smooth, premium exitand
👉 A struggling, uncertain process…is almost always preparation and timing.
If you want clarity on :
• What your business is realistically worth
• Whether now is the right time to sell
• How buyers and lenders will actually evaluate your numbers
I’m happy to have a confidential conversation.
