Most business owners don’t start thinking seriously about selling their company until they want to leave. That’s often too late. The decision to sell can happen quickly; preparing a business that someone else wants to buy usually can’t.

McKinsey estimates that about six million U.S. small and midsize businesses will face ownership transitions by 2035, with more than one million considered viable candidates for sale or employee ownership. Together, those businesses represent as much as $5 trillion in enterprise value. Yet McKinsey identifies a significant obstacle to those transitions: Many owners underestimate how long it takes to prepare a business for sale.

The better approach is to prepare your company long before you have any intention of selling it. Not because you need an exit plan. Because you need options.

A Sellable Business Is Usually a Better Business

When buyers evaluate a company, they aren’t simply buying its current revenue or profits. They want to understand whether those results are sustainable under new ownership.

That means looking at questions such as: How dependent is the business on its owner? Are revenues concentrated among a few customers? Is there a capable management team? Are processes documented? Are margins healthy and consistent? Does the company produce reliable financial information?

Those aren’t just questions for a future buyer. They’re questions that matter to you as the current owner.

A business that can operate without your constant involvement gives you more freedom. Strong systems can make growth easier. A capable team allows you to step away from day-to-day decisions. Predictable cash flow and reliable financial reporting can help you make better decisions.

In other words, the characteristics that can make your company more attractive to a buyer can also make it a better company to own. The goal isn’t necessarily to build a business you want to sell. It’s to build a business someone else would want to buy.

Preparing A Business For Sale Early Creates Options

Business owners often think about succession as a decision they’ll make someday.

Bank of America’s 2026 Study of Wealthy Americans illustrates the disconnect between recognizing the importance of succession and preparing for it. It stated that 78% of wealthy business owners surveyed said succession planning was important to their wealth strategy, yet only 20% had a fully documented succession plan. But succession doesn’t have to mean retirement.

Perhaps you eventually sell to another company or a private investor. Maybe you transition ownership to employees or family members. You could hire a president and step away from daily operations while retaining ownership. Or you might continue running the company for another decade.

The point is that you get to choose. When a business depends entirely on its owner, those choices become much more limited.

Time Is Your Biggest Advantage When Preparing A Business For Sale

McKinsey describes preparation as the first stage of a successful ownership transfer. Long before a transaction takes place, owners can assess readiness and strengthen the leadership, financial and operational capabilities needed for a transition.

That’s difficult to accomplish when you’re already determined to leave.

Customer concentration can’t always be fixed in six months. Developing a strong management team takes time. Building recurring revenue, improving margins, documenting processes and reducing dependence on the founder can take years.

Starting early also means you aren’t making decisions under pressure. Life doesn’t always respect your preferred exit timeline. Burnout, health issues, family circumstances, partnership changes or an unexpected acquisition offer can suddenly change what you want from your business.

Being prepared doesn’t mean you have to sell . It means circumstances don’t get to make the decision for you.

The best time to prepare your business for sale is when selling is the last thing on your mind. Look at your company as a buyer would. Identify the risks that make it dependent on you. Strengthen the areas that make its profits sustainable and transferable. Then keep building. You might sell in three years, ten years or never, but there’s a significant difference between choosing to keep your business and having no practical choice but to keep it. A valuable, transferable business doesn’t just create wealth. It creates options and options give business owners freedom.

Melissa Houston, CPA, CEPA , is a Fractional CFO and business value advisor who helps founder-led businesses improve financial performance, build enterprise value and prepare for a future exit. She is the host of The Sellable Firm Podcast and author of Cash Confident: An Entrepreneur's Guide to Creating a Profitable Business .

The opinions expressed in this article are those of the author and are intended for informational purposes only. They should not be considered accounting, tax, legal, or financial advice. Readers should consult qualified professionals regarding their specific circumstances.