Frequently Asked Questions
These FAQs are designed to help business owners better understand the M&A process and how Beacon Mergers & Acquisitions can support them. Click each question to reveal detailed answers.
At Beacon Corporation, Brokerage we specialize selling small to medium size businesses, mostly privately owned, with revenues between $5 million and $250 million. Rather than focusing on a certain industry, we represent a wide variety of Businesses for Sale across diverse industries and sectors, ranging from general contractors and other construction trades, to retail, services and manufacturing businesses. We have extensive experience with both Business-to-Business (B2B) and Business-to-Consumer (B2C) companies. We work with business owners across in South Florida, Miami, Fort Lauderdale, Washington, D.C., Southern Ontario, including Toronto, the GTA, Burlington, Hamilton, St. Catharines and Niagara Falls.
Most private small to medium size businesses that are available to purchase are on the market because of personal reasons of the owners rather than because the company is in financial trouble. Generally, we will enlist only businesses that have been established and have a healthy financial outlook. Reasons to sell include: the wish to retire – especially true for the “baby boom” generation, a feeling of “burn out” leaving the seller uninterested in continuing the business, other business interests or opportunities available to the owner that he/she would like to pursue, desire by the owner to move to another location, divorce or partnership split-ups, health reasons, death of the owner.
Before you place your business on the market for sale, there are general issues that owners should address. The goal in preparing your business for sale is to show it in its best marketable position so that a prospective buyer can optimally assess the business value and future growth potential. Some items to address are of a housekeeping nature, whereas others require more change and a longer timeframe to implement. Things to consider include: a) Financial – ensure that you have been keeping accurate financial records so that profitability can be understood and verified easily by a prospective buyer, b) Human Resources – structure the business so that it is not dependant on you solely, ideally have a manager in place who knows the business well and can help smoothen the transition to a new owner, c) Operations – strengthen systems and documentation, and reduce costs where possible to generate higher profitability, d) Marketing – increase your marketing activities in order to keep growing your business, e) Administration – organize your paperwork such as incorporation papers, leases, contracts, licenses.
Standard costs associated with selling or buying a business include fees to accountants and lawyers, and commission costs to the business broker. As a general rule, we suggest to assume at least $10,000 in closing costs on top of the commission costs that consist of a percentage of the transaction price – normally 10% for the first $1M, with a sliding scale for subsequent tranches. The commission costs are paid by the seller, whereas both parties will carry closing costs as they each need an accountant and lawyer. Additional costs to the seller may arise from settling outstanding debts, lawsuits or other liabilities before the transaction is closed. Additional costs to the buyer may include severance payments to lay-off non-essential employees and other expenses to improve business performance.
Buyers can typically be categorized in two categories; those individuals that have built extensive work experience in a certain industry and are now looking to become an independent business owner, and business owners operating a company in the same or complimentary industries, who wish to expand and/or diversify their operations.
Rather than building a new business from scratch, buying an existing business provides significant advantage from a financial and operating point of view. It allows for an immediate generation of revenue at a reduced cost, permitting the new owner to focus on ways how to grow the business and improve performance. Benefits include: reduced capital investment requirements before the start of operations (e.g. leasehold improvements, equipment purchase), operations and logistics fully embedded and in place; agreements with suppliers, leases and licenses, employees, organizational procedures, existing brand name and reputation, including repeat business from existing customers and access to past client lists. transitioning and training period with the former owner to learn the specifics of how to run the company and compete in the industry.
Working with a professional M&A advisor like Beacon ensures that your business is properly valued, marketed confidentially, and presented to the most qualified buyers. Our team manages the entire process—from preparing materials and identifying buyers to negotiating terms—so you can focus on running your business.
The ideal time to sell is when your business shows strong financial performance, market conditions are favorable, and you’re emotionally and financially ready. Planning ahead and preparing with an advisor can increase your chances of a successful exit.
Most M&A transactions take between 6 to 12 months. The timeline depends on your industry, company readiness, buyer interest, and deal complexity. Beacon helps streamline the process to minimize disruption to your operations.
Valuation depends on financial performance, industry trends, growth potential, and market comparables. Most businesses are valued using a multiple of EBITDA, adjusted for working capital and deal terms. Beacon provides a detailed, defensible valuation as part of our advisory service.
We use non-disclosure agreements (NDAs), anonymous teaser documents, and secure virtual data rooms. Only pre-qualified buyers receive sensitive information in stages, minimizing risk to your business.
Not unless you tell them. Our process is highly confidential, and we work to ensure that employees, customers, and suppliers only find out about the sale after it closes, unless disclosure is strategically necessary.
Selling your business can trigger capital gains taxes and other financial implications. We work with your accountants and tax advisors to structure the deal in a way that maximizes after-tax proceeds.
Buyers usually expect the business to be delivered without debt and with sufficient working capital. Excess cash or debt is typically settled before closing and does not factor into the purchase price.
An LOI outlines the key terms of a potential deal. It’s usually non-binding, except for clauses like confidentiality or exclusivity. It serves as the basis for due diligence and drafting definitive agreements.
Yes. Even if you have an offer, an advisor can benchmark it against market value, introduce competition, and negotiate better terms. Many one-on-one deals fall apart without professional guidance.
We offer end-to-end sell-side advisory: business valuation, marketing strategy, buyer outreach, negotiation, due diligence management, and closing support. We act as your transaction quarterback to ensure a successful outcome.
We research and reach out to strategic, financial, and international buyers based on their acquisition criteria. Each prospect is vetted for fit, capacity, and interest before proceeding.
Yes, but relationships are secondary to strategy. Our goal is to target the right buyers—whether we know them already or not—based on your company’s unique value proposition.
Absolutely. We structure and facilitate management buyouts (MBOs), family succession strategies, and partial exits to support your long-term goals.
Our fees typically include a retainer and a success-based component upon closing. This ensures alignment of interests and accountability throughout the engagement.
We specialize in deal strategy, buyer targeting, and value creation—areas that lawyers and accountants don’t typically cover. Our involvement often leads to better valuation, smoother processes, and higher closing rates.
Start by organizing financials, streamlining operations, and resolving any legal or operational issues. We guide you through this process and identify opportunities to enhance your company’s appeal.
You’ll need at least 3 years of financial statements, tax returns, forecasts, customer data, employee records, and key contracts. We help organize and present this data to strengthen buyer confidence.
Yes. We conduct a strategic review and recommend improvements that enhance value—such as margin optimization, customer diversification, and recurring revenue models.
Audited financials are not always required but can boost buyer confidence and valuation. At minimum, clean and well-organized financials prepared by a CPA are essential.
Disclose them early and honestly. We help manage buyer concerns and structure indemnities or escrow terms to address these issues without derailing the deal.
Strategic buyers are companies in your industry looking to expand. Financial buyers, such as private equity firms, are investors seeking returns. Each type offers different advantages and deal structures.
It depends. Many deals require a transition period of 6–24 months, especially if you hold key relationships or knowledge. Some buyers prefer full transitions; others retain sellers long-term.
An earnout is a portion of the purchase price paid based on future performance targets. It aligns interests but adds complexity. We help negotiate fair and achievable terms.
Buyers expect a normalized level of working capital to support operations. Variances are adjusted in the final price. We help define and negotiate this metric during the deal.
Deals may include cash, shares, vendor take-back (VTB) financing, and earnouts. The optimal structure balances tax efficiency, risk, and seller preferences.
These tools protect buyers against post-closing risks. A portion of the sale price may be held in escrow for a period, subject to claims. We negotiate to limit your exposure.
Yes. You can sell 100% or retain equity through a minority sale, recapitalization, or private equity partnership. We help structure your ideal exit.
We assist with transition planning, communication strategies, and post-close financial integration. Our goal is to ensure your exit is smooth and successful.
Strategic buyers typically seek synergies and operational integration. Private equity buyers focus on investment return and may keep existing management. Each has different implications for culture, valuation, and structure.