Buyers pay for certainty. Sellers who prepare before going to market move faster, face fewer price reductions in due diligence and protect more of their headline value. This article sets out the key sell-side steps that matter most and the avoidable mistakes that cost owners value.

A problem the buyer finds is leverage. The same problem, if you identify it early is a path to a sale.

In the first article in this series 'Exit timing: Strategy over sentiment', we looked at timing and strategic intent in planning an exit. Once the decision to sell is made, value is won or lost through execution. Buyers price risk: every unanswered question, undocumented arrangement or unexplained number uncovered during due diligence can provide  a reason to reduce the price, tighten the warranties, defer part of the consideration or, in some cases walk away. Last minute restructurings and other "fixes" to issues  identified by buyers can also create scepticism and reduce price. 

Preparation is therefore not just about tidying the books. It is about adopting a buyer’s perspective and proactively addressing the factors that drive value and confidence. This means anticipating the questions, concerns and due diligence requests that buyers will raise and having a credible answer (or a solution) ready before they ask. Sellers who do this keep control of the timetable and the negotiation. Those who do not often find leverage shifting to the buyer late in the process, when it is hardest to recover.

A pre-sale health check, often called sell-side due diligence, is an important step in protecting value. It should begin well before you approach the market (ideally three to six months ahead), so that there is time to fix problems rather than simply disclose them. Key areas to review, and the questions a buyer will ask, include:

• Financial reporting: are your accounts accurate, timely, and ready for third party accountant review? Can you clearly explain historical performance, adjustments to earnings and future projections? Buyers don't expect perfect financial statements, but they do expect coherent financial information that is presented clearly and tells a consistent story about the financial position of the business. Unreliable numbers can lead to a price reduction or a longer, more intrusive diligence process.
  
  
• Contracts and compliance: are key customer, supplier and employment agreements up to date and assignable? Do any contain change of control, exclusivity or consent requirements that a sale will trigger? Have you given personal guarantees (for example, on a lease) that need to be released and are there security interests registered on the PPSR that a buyer will find? Are there any hidden liabilities or compliance gaps? Issues the buyer finds first can result in price adjustments, specific indemnities or conditions to completion. If you understand the issue in advance, you can control the terms of the discussion.
  
  
• Intellectual property: are your IP rights registered, protected and clearly owned by the business? IP developed by founders or contractors and never formally assigned to the company is a source of late-stage delay.
  
  
• Management and succession: can the business run without the current owners? Is there a credible second-tier management team in place? Where the value of the business is heavily dependent on its owners, buyers may seek a lower price, deferred consideration, earn-outs or extended handover arrangements.
  
  
• Structure: check too that the business itself, not you or a related entity, owns everything it needs to operate and that it is not carrying liabilities that don't relate to the business you're selling. A restructure done early, with appropriate tax advice can help. One rushed in response to r a buyer’s concern rarely does.
  
  
• Tax: is the structure of the business tax-effective for a sale, and have you checked early whether any available concessions apply? Tax advice taken late can narrow your options, so involve your tax advisers before the process starts. 
  
  
• Data, privacy and licences: if you hold customer data, do you understand what data you hold how it is managed and  your privacy and cyber risk position, including any previous incidents? Are the licences and permits you operate under transferable, or do they need regulator consent? 

Addressing these issues early shortens the process, reduces the risk of a late re-price and supports a stronger valuation. Anything you cannot fix should be understood, quantified and ready to disclose: surprises are priced harshly, while known issues can be managed. Full and fair disclosure also protects you after completion, because properly disclosed matters generally cannot support a warranty claim.

Buyers expect transparency and detail. A well-prepared and materially complete data room demonstrates professionalism and builds trust. More than that, it allows you to control the narrative, highlight strengths, and address weaknesses on your terms. A thin or disorganised data room signals risk, invites more questions and slows momentum, which is when deals lose value.

A comprehensive Information Memorandum, which sophisticated buyers will expect, should complement the data room. It should tell a clear and credible  story about your business, its market position, growth prospects, and the rationale for the sale. It is your opportunity to shape buyer perceptions from the outset. Every statement and projection must, however, be based on genuinely held beliefs and capable of being substantiated: overstated claims can create legal exposure (including for misleading or deceptive conduct) and will damage your credibility when tested in diligence. Control access to commercially sensitive information, such as customer pricing and contract terms, through confidentiality undertakings and staged disclosure, so that it does not reach competitors before a buyer is committed.

In a competitive process, consider going a step further with a vendor due diligence report that bidders can rely on. It lets you set the scope, puts bidders on a level playing field and brings deal-breakers to the surface before bids are due. Expect limits in the form of assumptions and disclaimers and expect sophisticated buyers to keep doing their own work.

People issues are often underestimated in M&A, yet they are a frequent source of deal friction and post-deal disappointment. Early in the process, review your executive and broader employee arrangements. Focus on key-person dependency, retention and incentive arrangements, change of control or termination entitlements and accrued employee entitlements.

Buyers will scrutinise your team’s capability and stability. Addressing gaps or risks in advance reduces deal friction and the risk of a price reduction or retention holdback later. Confidentiality matters here too. If key staff learn of a potential sale informally, there is a risk they may leave, and the buyer may reconsider its price. Decide who needs to know, when and what retention arrangements will be in place.

Even well-run businesses can lose value in a sale process. The most common mistakes are:

• Overestimating value: unrealistic price expectations can stall negotiations or deter credible buyers. Test your expectations early against independent advice; 
  
  
• Inconsistent messaging: mixed signals from management or advisers erode buyer confidence. Agree one story, and one spokesperson, before going to market); 
  
  
• Neglecting the core business: focusing too much on the sale process at the expense of day-to-day performance can damage value. A soft quarter mid-process is a ready-made reason to re-price); and
  
  
• Underestimating timeframes: sales processes often take longer than expected, so build in contingency and maintain momentum, because delay increases the risk of leaks, buyer fatigue and a change in market conditions. Consider early whether your buyer's identity or the size of your business triggers regulatory clearance: since 1 January 2026, acquisitions that meet certain thresholds must be notified to the ACCC. [Australia’s merger regime: what the ACCC’s decisions are telling us.]

Getting sale ready is about more than compliance or presentation. It's about building a business that stands up to scrutiny, inspires buyer confidence and delivers value on completion. Early, thorough preparation makes a successful sale more likely and protects the price you ultimately receive.

• Commission a pre-sale health check across finances, contracts, IP, employment and tax, and fix what can be fixed before going to market;
  
  
• Map change of control and consent requirements in key contracts and licences and plan how and when to approach counterparties;
  
  
• Understand key-person dependency and consider appropriate retention arrangements for critical employees;
  
  
• Build the data room and information memorandum early with consistent figures, a single narrative and controlled access to sensitive information; and
  
  
• Set a realistic price and timetable and assemble your deal team (legal, tax and any financial advisers) before you approach buyers.

If you are considering a business sale in the next few years, the most valuable step you can take is to start preparing early. To discuss how to position your business for buyers, please contact our Corporate & Commercial team, who can support you at every stage of your exit, from pre-sale health checks through to completion.