Frequently asked questions about selling a business

A business's value rests on its financial results, its position in the market, and its growth potential. Three recognized approaches are crossed to land on a solid estimate — the valuation methods used for Quebec SMEs combine EBITDA multiples, discounted cash flows, and adjusted net asset value. The result is never a single number: it's a range that becomes negotiable once tested against the market. To understand in depth what a serious business valuation looks at, the dedicated guide covers each approach with worked examples.

Most brokers work on a success fee: they're only paid when the transaction closes, as a percentage of the sale price. Some engagements also include upfront or monthly fees to cover the marketing of the business. This model aligns the broker's interests with the seller's — the broker earns more when the seller gets a better price. At RCA, the model is 100% paid at closing, and the economics of a business broker are best assessed on the net price you walk away with, not on the headline rate.

Yes, but the options and the price will be different. An unprofitable SME can still hold value through its assets, its customer base, its intellectual property, or its strategic position in a market. The factors that drive a business's value go well beyond current earnings — and fair market value takes all of those elements into account.

The "right time" combines personal factors (motivation, health, retirement plans) and market factors (business growth, economic conditions, buyer interest in your industry). Ideally, you sell when the business is performing well — not when you're forced to. The decision to sell an SME is best prepared 12 to 24 months in advance to give you the time to optimize the net price.

On average, selling a business in Quebec takes between 6 and 12 months, from going to market to closing. Some transactions close faster, others take longer depending on the complexity of the business and market conditions. Due diligence alone can run 2 to 4 months — the questions a buyer will ask in due diligence are worth anticipating from the preparation phase onwards.

Ideally, preparation begins 12 to 24 months before going to market. That window lets you clean up the finances, optimize the tax structure, document operations, and reduce the risks that could scare a buyer away. For Quebec SMEs with $3 million or more in revenue, the more rigorous the preparation, the smoother the process and the more representative the price you obtain — the detailed guide on preparing your business for sale lists the workstreams to open first.

A letter of intent is a document in which a buyer formally expresses interest in acquiring your business, at a preliminary price and under preliminary conditions. It's generally not legally binding, but it marks the start of serious negotiation and due diligence — what a letter of intent actually commits you to walks through the clauses worth reading carefully before signing.

Due diligence is the in-depth review the buyer conducts after signing the letter of intent. It covers your business's financials, contracts, operations, legal, and tax aspects. It's a demanding but normal step — solid upstream preparation makes it run much more smoothly, and due diligence explained for a seller gives the full picture of the documents to gather.

A business broker brings three things that are hard to reproduce alone: access to a network of qualified buyers, the expertise to structure and negotiate the transaction, and a confidentiality filter that protects your identity throughout the process. The detailed analysis of the hidden costs of selling your business alone shows that the risk of undervaluing the SME, mishandling confidentiality, or losing buyers along the way often outweighs the broker's cost.

A well-run sale generally involves a broker (process management and negotiation), a tax specialist or accountant (tax optimization), and a lawyer (contracts and legal aspects). The broker coordinates the team of transaction professionals and makes sure each contributor steps in at the right moment — the criteria for choosing an M&A broker help you decide who runs the orchestration.

You can pull your business from the market at any time before closing. That said, the implications depend on the stage of the process and the terms of your engagement with the broker. The further along you are (letter of intent signed, due diligence underway), the more potential consequences a withdrawal carries — talk it through openly with your broker before deciding. Our business sale process spells out the exit points built into each step.

It's one of the most important structural decisions in a transaction. As a general rule, the seller prefers selling shares (more favourable tax treatment, possible exemption), while the buyer prefers acquiring assets (they choose what they buy and avoid hidden liabilities). The final structure often comes out of a negotiation between both parties, with the help of their respective tax advisors — the share sale vs asset sale comparison spells out the concrete tax trade-offs, within the broader context of tax planning for a business sale.

Essential documents include your financial statements for the past 3 to 5 years, your tax returns, the list of your assets, your important leases and contracts, and a portrait of your customer base. Your broker will provide a complete checklist and walk you through the preparation — the better organized the documents are, the smoother the process and the more credible you look to buyers. The guide on preparing your business for sale lists every file to gather before going to market.

The broker acts as a filter: they approach potential buyers without revealing your business's identity, have them sign non-disclosure agreements (NDAs) before any disclosure, and control access to sensitive information through a secure data room. The confidentiality mechanisms in a business sale cover the disclosure timeline, the blind profile, and how to handle a potential leak.

Absolutely — and it's essential. Buyers want to acquire an SME that's running well, not a business that's slipping because the owner has checked out. Your broker runs the sale process in parallel to minimize distractions, and most owners maintain normal operations throughout the engagement.

Confidentiality is critical throughout the process. As a rule, key employees are told after the letter of intent is signed, and other employees are informed at closing or just before. Telling them too early can create anxiety, departures, and leaks that compromise the transaction — the article when to inform your employees about the sale offers a concrete grid by employee profile.

In most transactions, the buyer asks for a transition period during which the seller stays available to ensure the transfer of knowledge. This period typically runs from 3 to 12 months and its terms (time, compensation) are negotiated in the purchase and sale agreement. For founders who built their SME over 20 or 30 years, the guide on preparing the seller's transition also addresses life after — often overlooked in the planning.

In most cases, the buyer wants to keep the employees — they're part of the business's value. Employment terms are generally maintained or improved to ensure stability through the transition. What happens to employees is a topic of negotiation and can be framed in the purchase and sale agreement — the article when to inform your employees about the sale also walks through the messages to share with them to avoid departures after closing.