Four Common Seller Mistakes

By Michael D. Rubin, CEO & Founder · Updated September 2026 · 730 words

The four mistakes that cost sellers the most are ignoring how a buyer sees the business, letting results slip while the sale is under way, going to market unprepared, and holding on to a price the numbers do not support. Each one is avoidable, and each one usually shows up later as a lower price or a deal that dies in due diligence.

1. Seeing the business only from the owner's side

You know the company's story from the inside. A buyer knows only what is in front of them: documents, answers and a few meetings. Before you go to market, ask two questions. What would I need to see to pay this price if I were buying? And would I believe it if a stranger handed it to me?

Those questions expose the weak spots quickly: add-backs with no receipts, key customer relationships that live in the owner's head, handshake agreements with suppliers, a manager who has never run the place without you. Fix what you can, document the rest, and the negotiation becomes a discussion of terms instead of an argument about trust.

It also helps to know what each type of buyer is really buying. A competitor or larger company in your industry, called a strategic buyer, may care most about your customers, territory or capabilities. A private equity group cares about steady cash flow and a team that can run the business without you. An individual buyer, often using an SBA loan, cares whether the lender will approve the deal and whether the business can support the debt. Present the business in the terms that matter to the buyer across the table.

2. Letting the business drift during the sale

A sale typically takes three to nine months, and buyers watch your monthly results the whole time. If revenue dips during due diligence, the buyer's lender notices, and the buyer may reopen the price, a move known as a retrade. The deal is never done until the funds are wired.

Keep selling, hiring and maintaining as if you planned to own the company for another ten years. Let your advisor handle buyer calls, data requests and scheduling, so your attention stays on the business. Our answer on maintaining performance while the company is marketed covers how to divide the work.

3. Going to market without the paperwork

Buyers read disorganization as a sign of how the company is run, and every document that arrives late gives them a reason to slow down or ask for a lower price. Have these ready before the first buyer sees anything:

• Three years of financial statements and tax returns that reconcile with each other.
• Monthly profit-and-loss statements for the current year.
• Revenue by customer, so concentration is visible and explainable.
• Customer and supplier contracts, leases, licenses and permits.
• An employee roster with roles, tenure and pay.
• An equipment and vehicle list, plus any environmental reports or pending legal matters.

4. Anchoring on a price the market will not pay

Years of work and sacrifice are real, but buyers do not pay for them. They pay for what they expect the company to earn under new ownership, usually measured as adjusted EBITDA, meaning earnings before interest, taxes, depreciation and amortization, corrected for owner-specific and one-time expenses. For companies with $3 million to $100 million in revenue, prices most often fall between three and seven times adjusted EBITDA. Where a company lands in that range depends on growth, customer concentration, management depth and the quality of its records.

A price set above that reality does not simply produce a lower offer; it often produces no offer, and a company that sits on the market goes stale. Get a grounded view first. A business valuation and the twelve-month checklist in preparing your business for sale show where the value comes from and what would raise it.

How MDR & Associates helps owners avoid them

Each of these mistakes is addressed before the company goes to market. The discovery meeting sets expectations, and after reviewing three years of financials the firm gives an opinion of value as a range rather than a flattering single number. The financial recast answers buyer questions before they are asked, the firm fields buyer traffic so you keep running the business, and a principal negotiates every offer. To see where your company stands today, request a free valuation snapshot.

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Questions owners ask next

How far ahead should I start preparing to sell?

Ideally 12 to 24 months. That gives time to clean up records, reduce reliance on the owner, sign key contracts and show a full year of improved results. Owners who start later can still sell well, but they usually have to accept the business as it is.

What if the valuation comes back lower than I hoped?

You have three choices: sell now at the realistic price, spend a year or two improving the drivers that hold the value down, or keep the company. A clear range lets you decide with facts rather than hope, and it shows which improvements would matter most.

Should I tell my managers that I am selling?

Usually not at the start. Many owners bring one or two trusted managers in once a serious buyer emerges, often with a stay bonus tied to closing. Your advisor and attorney can help you decide who needs to know, and when.