What happens from the first call to closing?

The steps to selling a business are the same whether you run a roofing, plumbing or HVAC company. What changes is how long each one takes and where it tends to go wrong. Most owners picture the sale as the day they sign. In practice the signing is near the end, and the part that decides your price happens one to three years earlier, when you still have time to fix things.

Here is the whole road in one table, then each step in plain words.

The steps at a glance

On market time: Axial reports roofing deals on its network took 8.3 months on average to close. Some buyers move faster on their own terms; Leap Partners, for example, describes a 45-day process. We did not find a trustworthy published figure for each step in between, so treat any single number you hear for "how long diligence takes" as one person's experience.

Step 1: Get a value you understand

Start with a range, not a single number, and learn which basis applies to you. Small owner-run companies are mostly priced on seller's discretionary earnings (SDE); BizBuySell's HVAC sold deals from 2021 to 2025 had a median of 2.58x SDE. Larger companies with managers are priced on EBITDA. The point of a valuation at this stage is the list of drags, because that list becomes your prep plan.

Step 2: Prep the business

This is the step that moves your price. The usual list: three years of clean books that match your tax returns, a second person who can sell and run the day, a written plan for who holds the license, signed pay plans for key people, and fewer surprises in your contracts. A plumbing company where the owner is the only master should start on that at least 12 months before selling, per Chisel. Retention plans for key staff work best set up 12 to 24 months before a sale, as discussed on PM Magazine's podcast.

Step 3: Find buyers, with or without a broker

Most small trade companies sell to people, not funds. The IBBA's Q4 2025 survey found first-time buyers made 46% and serial entrepreneurs 32% of Main Street acquisitions. Many of them borrow through the SBA 7(a) program, where the maximum loan is $5 million.

With a broker. A broker or M&A advisor prepares the package, finds and screens buyers, and runs the process. Most are paid a success fee at closing. One published example: Brentwood Growth, a trades broker, charges $300,000 on a $5M deal (6% by our arithmetic), $100,000 on a $1M deal, and no upfront fee, using a "Double Lehman" scale. Fees elsewhere differ, so ask for the full schedule in writing. Also ask whether the broker is licensed where you are: BizBuySell lists 17 states that tie business brokerage to a real estate license, with Illinois requiring securities registration instead.

Without a broker. Owners do sell directly to a local competitor, a key employee, family, or a platform that wrote to them. You save the fee, but you lose a second bidder pushing your price, and you still need an attorney and a CPA. We are not a broker. If you want one, we can introduce you to an independent licensed broker, only if you ask.

Step 4: Indications of interest (IOI)

An IOI is a short, non-binding note: "we would pay somewhere around this range, structured roughly like this." Bigger buyers send them after a first look at your numbers. Compare them on structure, not just the top number: how much is cash at closing, how much is a seller note, an earnout or rolled equity.

Step 5: The letter of intent (LOI)

The LOI picks one buyer. It sets the price, the structure, the deal type (asset or stock), what you will do after closing, and usually an exclusivity period during which you cannot talk to other buyers. Most of it is non-binding, but your leverage drops the day you sign, so settle the big points here. Read asset sale vs stock sale before this step.

Step 6: Due diligence

The buyer and their lender, accountant and attorney check everything: books, customers, contracts, people, licenses, insurance, trucks and legal history. This is where most deals slow down or shrink. Our due diligence checklist lists what to have ready.

Step 7: Quality of earnings

Larger and PE buyers hire an accountant to test your profit, and a quality of earnings provider will test each add-back. SBA lenders check seller numbers against IRS transcripts. Add-backs you cannot document tend to come off the price.

Step 8: The purchase agreement

The binding contract. It turns the LOI into detail: exact price and payment terms, what is included, your promises about the business (representations), what you owe if one proves wrong (indemnity), any money held back in escrow, your non-compete, and your employment or consulting agreement. Your attorney earns their fee here.

Step 9: Closing

Funds move, the lender pays, debts are paid off, documents are signed. In licensed trades, the license plan must be ready on this day. In Florida, for example, a business whose only qualifying agent leaves has 60 days to employ another.

Step 10: Transition

You introduce the buyer to customers, crews and suppliers. If the buyer uses an SBA loan for a full change of ownership, the seller can only stay on as a consultant for a limited time: 12 months under SOP 50 10 8, and 24 months under SOP 50 10 8.1, which took effect October 1, 2026, per Prencipe. More in what happens after the sale.

If you run a roofing, plumbing or HVAC company

Common mistakes

• Starting at step 3. Going to market before prep means selling at today's drags.
• Comparing headline prices. Two offers at $3M can pay very different cash at closing.
• Signing an LOI with open big points. Deal type, price split and your role after closing are harder to fix later.
• Letting the business slip during diligence. Buyers watch monthly results until closing. A bad quarter can reopen the price.
• Leaving the license plan for closing week. In licensed states it can stop the closing.

Questions to ask your CPA, attorney or broker

1. Based on my books today, which basis (SDE or EBITDA) will buyers use, and what would move me to the other one?
2. What should I fix first, and how long will it take?
3. Do I need a broker for my size and buyer type? What is your full fee schedule, and are you licensed in my state?
4. How should I compare IOIs that have different structures?
5. What must be settled in the LOI, and how long an exclusivity period is reasonable?
6. Should I pay for my own quality of earnings review before going to market?
7. What will the buyer's lender need from me, and how long can I stay on after closing?

Sources

1. Contracting Business, The 12 Essential Steps for a Profitable Contracting Exit Strategy, Part I
2. Axial, Roofing M&A Activity and Market Trends
3. Leap Partners, Our Process
4. BizBuySell, HVAC Business Valuation Multiples and Financial Benchmarks
5. Chisel Industries, How to sell a plumbing business
6. PM Magazine, Retention: The Best Exit Strategy
7. PR Newswire, IBBA and M&A Source Market Pulse Q4 2025
8. SBA, 7(a) loans
9. Brentwood Growth, Our Pricing
10. BizBuySell, Business Broker Licenses, Registrations, and Certifications
11. Raincatcher, Private Equity in HVAC
12. Florida Statutes 489.119, Business organizations; qualifying agents
13. Prencipe International, SBA caps how long your seller can stay
14. CapBench, SBA SOP 50 10 8 rule changes 2025 to 2026