Advisory List Publishes Exit Preparation Guidance for Business Owners Considering a Sale

- M&A professionals identify financial, operational and ownership issues business owners should address years before a sale -

SAN DIEGO, Calif., Aug. 26, 2026 (SEND2PRESS NEWSWIRE) — Advisory List, a directory and professional community for the small and middle-market M&A ecosystem, has published new guidance for business owners considering a future sale, highlighting issues transaction professionals say should be addressed years before a company goes to market.

The feature draws on perspectives from Fahaad Potrik, CPA, Co-Founder and Head of Financial Diligence at Rapid Diligence; Russell Cohen, President and M&A Advisor at South Florida M&A Advisors; and Wayne Wright, Founder and Lead Advisor at Wright Business Advisors. Their perspectives highlight a common issue: some transaction risks can be addressed relatively quickly, while others require years of financial and operating history to change.

Areas identified include financial reporting, customer and vendor concentration, recurring revenue, management depth, owner dependence, intellectual property ownership and real estate arrangements. The guidance is part of Advisory List’s effort to make practical M&A knowledge more accessible across the transaction ecosystem.

FINANCIAL PREPARATION STARTS WELL BEFORE DILIGENCE

Potrik says owners should separate personal and discretionary spending from the company’s profit and loss statement and document those expenses as they occur.

“The highest-leverage move is separating personal and discretionary spending from the P&L and documenting it as you go, rather than trying to reconstruct it later,” Potrik says.

Buyers and quality of earnings advisers typically examine reported EBITDA and assess which items should be normalized. Potrik recommends owners preparing years in advance maintain a monthly, accrual-adjusted P&L and a separately tagged schedule of addbacks and one-time expenses. That creates a record of performance and contemporaneous support for adjustments later presented during diligence.

Cohen likewise recommends improving accounting practices well before a sale. He points to fractional CFOs, business coaches and exit advisers as resources when financial reporting needs more discipline. A quality of earnings process, he notes, puts significantly more attention on the accounting behind reported earnings.

CONCENTRATION RISK CANNOT BE ERASED AT CLOSING

Customer concentration is another area where preparation time matters. Potrik says a company cannot manufacture a diversified customer base just before a sale, just as a business built primarily on transactional revenue cannot retroactively create years of recurring or contracted revenue.

Cohen says he encounters the issue with both customers and suppliers.

“I see a lot of owners who have one or two clients. I also see businesses that have one or two vendors,” Cohen says. “Sometimes account concentration will make a business unsellable.”

Where concentration does not prevent a transaction, Cohen says it can influence deal structure, including seller financing, earnouts or rollover equity. Owners considering a sale years in advance have time to broaden the customer and supplier base and establish those relationships in the company’s operating history.

Potrik also identifies declining revenue as an issue to monitor well before a sale. Multiple years of decline can concern lenders unless the trend is documented and adequately explained. Historical revenue performance cannot be rewritten once a transaction begins.

BUYERS ALSO EVALUATE WHAT HAPPENS WHEN THE OWNER LEAVES

Wright’s advice to owners preparing two or three years before a sale is direct:

“Start making your business transferable instead of owner-dependent,” Wright advises.

Wright saw that dynamic firsthand when he sold a business in 2016. The company had a strong management team, loyal employees and long-standing customer relationships that did not depend on him personally. According to Wright, that structure expanded the qualified buyer pool and gave the lender greater confidence even though the eventual buyer had management experience but little industry experience.

Wright recommends delegating customer relationships, developing management, documenting important systems and procedures, reducing reliance on the owner’s knowledge and decision-making, and creating recurring and predictable revenue where possible.

Cohen describes the same issue from the perspective of buyers evaluating management infrastructure.

“You don’t want to be the legend in the business,” Cohen says. “You want to have layers of management in place.”

A business that can continue operating after the owner’s departure may present less transition risk than one where customer relationships, decisions and institutional knowledge remain concentrated with the seller.

INTELLECTUAL PROPERTY AND LEASES CAN BECOME TRANSACTION ISSUES

Cohen also encourages owners to examine intellectual property and real estate arrangements before a sale. Trademarks, applicable patents, domains, websites, social media accounts and other rights associated with company goodwill should be clearly controlled and transferable.

“If intellectual property is important, make sure that’s all buttoned up,” Cohen says.

Cohen says he has encountered transactions complicated by intellectual property divided among family members or business locations. Resolving ownership questions early can reduce the risk of legal or negotiating obstacles during diligence.

Real estate can require similar planning. When a company leases its property, Cohen recommends understanding the lease terms and potential future rent changes before a buyer begins evaluating the business. Early attention gives the owner more time to address occupancy issues before a transaction.

BRINGING SMB M&A EXPERTISE INTO THE OPEN

The new feature reflects Advisory List’s role in professional discovery and industry knowledge. The platform brings M&A advisors, business brokers, lenders, financial diligence providers, fractional CFOs, attorneys, valuation professionals and other participants in the small and middle-market transaction ecosystem into a searchable directory, while its community gives buyers, sellers, investors and advisors a place to exchange practical information.

According to Advisory List, the platform includes more than 9,500 advisors and professionals across 18 specialties, spanning all 50 states and Canada. It also offers concierge matching and publishes industry insights about the professionals, financing sources and issues involved in buying or selling a privately held business.

For owners, the central takeaway is that transaction preparation does not begin only after the decision to sell. Financial history, customer diversification, management development and owner independence can take years to establish.

The complete feature, along with profiles of Rapid Diligence, South Florida M&A Advisors and Wright Business Advisors, is available through Advisory List.

https://advisorylist.co/insights/how-to-prepare-a-business-to-sell

ABOUT ADVISORY LIST

Advisory List is a directory and professional community for small and middle-market M&A. It helps business owners, buyers, investors and advisors find and connect with M&A advisors, business brokers, lenders and other transaction professionals, while providing a community for industry discussion, concierge advisor matching and educational content. According to Advisory List, its directory spans more than 9,500 professionals across 18 specialties in all 50 states and Canada. Learn more: https://advisorylist.co/.

MEDIA CONTACT

Gaston Reeder

Advisory List

619-380-1942

hello@advisorylist.co

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NEWS SOURCE: Advisory List

Keywords: Mergers and Acquisitions, mergers acquisitions, business sale, exit planning, financial diligence, business valuation, M&A advisors, business owners, selling a business, ADVISORY LIST, Finance, Mergers and Acquisitions, Investment Services, Taxes and Accounting, SAN DIEGO, Calif.

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