Exit planning
Pre-Exit Consulting Services
What pre-exit consulting fixes in the 12 to 24 months before a sale, which factors raise or lower value, and how the work is priced.
By Michael D. Rubin, CEO & Founder · Updated September 2026 · 838 words
Pre-exit consulting is the work done in the 12 to 24 months before a sale to fix what would lower a company's price and strengthen what would raise it, so the business goes to market ready to earn full value. At MDR & Associates it is a separate, optional service with its own price, for owners whose companies are profitable but not yet ready to show buyers their best.
Some companies are ready for market the day the owner decides to sell. Many are close, with a few issues that would cost far more in price than they cost to fix. This page explains what those issues are and what the consulting work covers.
Signs a company needs work before it goes to market
An honest review often turns up one or more of the following. None makes a company unsellable, but each gives a buyer a reason to lower the offer, add conditions, or move on to the next opportunity:
- Books kept for taxes rather than for a buyer, with owner expenses mixed into operating costs
- Revenue or profit that has been flat, uneven or slipping for a year or more
- An owner who still holds the key customer relationships and makes most daily decisions
- One or two customers that account for a large share of revenue
- No written procedures, organization chart or job descriptions
- A facility that looks neglected or disorganized on a walk-through
What raises and lowers value in a buyer's eyes
Buyers of companies with $3 million to $100 million in revenue most often pay three to seven times adjusted EBITDA (earnings before interest, taxes, depreciation and amortization, corrected for owner and one-time costs). Where a company lands in that range depends on factors like these:
| Factor | Raises value when... | Lowers value when... |
|---|---|---|
| Financial records | Figures flow cleanly from invoices to ledger to tax returns | Records are incomplete or do not match the returns |
| Revenue trend | Sales and profit rise steadily year over year | Results are uneven or sliding |
| Owner role | Managers run daily operations and customer contact | The business depends on the owner |
| Customers | Many long-standing accounts, none dominant | A few customers carry most of the revenue |
| People | Key staff stay, are cross-trained and have clear roles | Knowledge sits with one or two people |
| Systems | Written procedures let new hires learn fast | Everything runs from memory |
| Owner perks | Few, and each one documented | Personal costs are buried and hard to prove |
| Working capital | Needs are understood and priced into the deal | Large cash needs surprise the buyer |
| Facility | Clean, orderly and laid out so work flows | Cluttered or rundown at first sight |
Red flags that cost more than money
Some issues damage trust rather than just the numbers. Unreported cash is the clearest example: it cannot be counted in the earnings a buyer pays for, and it makes buyers wonder what else is off the books. Owner perks that cannot be traced to documents create the same doubt. A vague reason for selling raises questions about the company or its industry, while a clear one, such as retirement, reassures. And a seller who is slow to answer questions or reluctant to share information can end a deal on attitude alone. Pre-exit work deals with these before a buyer ever sees them.
What the consulting work covers
Every engagement is shaped to the company, but the work usually includes:
- A financial recast that separates true operating earnings from owner and one-time costs
- Cleaning up records so statements reconcile with tax returns, working alongside your CPA
- Moving customer relationships and daily decisions from the owner to managers; our answer on the discount buyers apply for owner dependence explains why this matters so much
- An organization chart, job descriptions and written procedures for core processes
- A plan to reduce reliance on the largest customers
- A clear view of the working capital the business needs, so it is priced correctly
- Practical fixes to the facility and its first impression
How long it takes and what it leads to
The timeline depends on the gaps. Tidying records and documenting procedures can take a few months; shifting relationships away from the owner or broadening the customer base usually needs a year or more to show in results. The aim is to go to market with at least one full year of improved numbers behind the story, because buyers believe results more than plans. Our answer on what you can do in the next year to raise your valuation lists the moves that show up fastest.
Where MDR & Associates fits
We offer pre-exit consulting and formal business valuation as separate services, each priced on its own. When the company is ready, our sale representation is 100% performance based: a success fee only if and when it sells. We decline engagements when we do not believe we can sell a company for maximum value, and pre-exit work is often how an owner gets from not yet to ready. To see where your company stands, start with the free valuation snapshot.
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Questions owners ask next
Is pre-exit consulting included in the sale fee?
No. Pre-exit consulting is a separate, optional service with its own price, agreed before the work begins. The sale itself is handled on a 100% performance-based fee, paid only if the company sells. Many owners use both: consulting to prepare the company, then representation to sell it.
Can I do the preparation without a consultant?
Some of it, yes. Your CPA can clean up records and your managers can document procedures. What an experienced advisor adds is the buyer's view: which issues will actually move the price, which will not, and in what order to tackle them so the improvements appear in the numbers before you go to market.