How many business listings actually sell?

 By Sudarsan Pattabiraman (M&A Advisor) | 510.944.5616 | sudarsan@upclinch.com

The rate of success for businesses listed on the market varies widely based on their size, preparation, and sector. Generally, small businesses (like those with under $3 million EBITDA) have success rates between 15-30%, while mid-sized businesses can see success rates closer to 30-70%. A business's likelihood of sale is influenced heavily by the level of seller preparedness, business attractiveness to buyers, and current market conditions. These statistics can be tricky to verify because brokers often define "success" differently, sometimes excluding cases where the seller changes their mind or withdraws the listing.

The success rate of businesses selling after going to market depends on several factors, with larger, well-prepared businesses typically having an edge. Market readiness, including clear financials and accurate valuations, plays a significant role. Larger businesses often have well-documented financials and a diversified customer base, which makes them attractive to buyers looking for stability. Small businesses, however, can struggle in these areas, sometimes lacking the detailed documentation or robust financial records that buyers expect. This lack of preparation can lead to deal-breakers during due diligence

Another factor is buyer perception of risk. Small businesses are often seen as riskier investments due to their reliance on a single owner or a few key clients. Mid-sized and larger companies, by contrast, may have diversified revenue streams and stable management, which reduces perceived risk and increases buyer confidence. Additionally, realistic pricing expectations are crucial; small business owners may set prices based on emotional attachment rather than market value, which can turn buyers away. Larger businesses, especially those with professional advisory representation, tend to be priced more competitively and are therefore more appealing

Finally, economic conditions impact sales rates. Strong market conditions and accessible credit make acquisitions more attractive, boosting the likelihood of successful sales across all business sizes. Professional representation also matters; experienced advisors bring a network of buyers, a strategic approach to negotiation, and market insight, which particularly benefit mid-sized and larger businesses.

Contact Sudarsan for planning and executing your perfect exit / strategic acquisition. Schedule time to unlock the business value and realize it for the benefit of you, your family and your community. Email:sudarsan@upclinch.com   Phone: 510.944.5616

Sources:

Morgan & Westfield estimates approximately 15-30% success for small businesses and up to 70% for larger ones. Similarly, surveys and data from firms like BizBuySell report varying statistics on business sales, reflecting how only well-prepared and market-aligned businesses attract buyers effectively.