Preparing Your Business for Sale: A Checklist

Short answer

The best time to prepare is two to three years before you want to sell. Buyers pay for profit they can rely on and a business that runs without you, so focus on written contracts, in-date accreditation, clear accounts, a spread of customers and a team that customers know. Then gather the documents a buyer's due diligence will ask for, so the sale moves quickly once terms are agreed.

1. Two to three years before

Put contracts in writing. Planned maintenance agreements written down, in date and in the company's name, with renewal dates you can show.
Keep accreditation current. LCA registration for water work, or BAFE, FIRAS or NSI certification for fire work, with audit findings closed off.
Step back from the day to day. Let your engineers and office team hold customer relationships, so the business does not depend on you.
Spread your customers. If one customer is a large share of income, start reducing that share now. See our guide to customer concentration.
Keep the accounts clear. Keep personal and one-off costs out of the company, or record them so your accountant can show adjusted profit.
Talk to your accountant about tax. For example, GOV.UK says that to qualify for Business Asset Disposal Relief on a share sale you generally need to have been an employee or officer of the company, and held at least 5% of its shares and voting rights, for at least two years before you sell. The Budget on 28 October 2026 announced that the relief's lifetime limit will fall from £1 million to £500,000 for disposals on or after 6 April 2027, subject to legislation, so ask your accountant how this affects your timing.

2. Six to twelve months before

Produce monthly management accounts, and ask your accountant for an adjusted profit figure.
Check your Companies House filings are up to date and your register of shareholders is accurate.
Read your main customer contracts for change of control clauses, which let a customer end or renegotiate a contract when ownership changes.
Make sure every employee has a written contract, and that training and competence records are complete.
Check property leases, vehicle leases and finance agreements, including any personal guarantees you have given.
Choose a solicitor who regularly acts on business sales.

3. Documents buyers ask for

A buyer's due diligence will usually ask for:

three years of statutory accounts and current management accounts;
a customer list with annual value, contract dates and renewal terms;
copies of the main customer contracts and any framework agreements;
accreditation certificates and recent audit reports;
a staff list with roles, pay, start dates and contracts, and training records for each engineer;
insurance policies and claims history;
health and safety policies, risk assessments and accident records;
vehicle, equipment and property agreements;
the software you rely on, such as scheduling, reporting or digital log book systems, and its licences;
bank and finance agreements, and details of any disputes, complaints or claims.

4. What slows a sale down

Contracts that are not written down, or are in the owner's name rather than the company's.
Accreditation that has lapsed or has open audit findings.
One customer providing a large share of income.
Customer relationships held only by the owner.
Accounts that mix personal and business costs.
Disputes that have not been resolved.

5. Talking to Richmonds early

You do not need to have everything in order before you talk to us. Many owners start the conversation years before they sell, and we can tell you what we would want to see. There is no cost and no obligation. Start a confidential conversation.

Questions owners ask

How long before selling should I start preparing?

Ideally two to three years. That gives time to put contracts in writing, spread customers, reduce reliance on you and show steady profit in your accounts.

What documents will a buyer ask for?

Usually three years of accounts and current management accounts, customer contracts and values, accreditation certificates and audit reports, staff details and training records, insurance, health and safety records, and property, vehicle and finance agreements.

Can I sell if my contracts are not written down?

Usually yes, but a buyer will want evidence that the work recurs, such as invoices and renewal history. Putting your main agreements in writing before you sell makes the business easier to value.

Sanjeev Desour is the founder of Richmonds, which buys UK water hygiene, water treatment and fire safety businesses from owners who want to retire. He founded IGNITE Academy in 2014 and runs the IGNITE Group of companies. LinkedIn

Sources

This guide is general information, not legal, tax or financial advice, and it is not an offer to buy any business. It reflects the rules and announcements known on the "last reviewed" date above. Tax rules and rates change, and announced changes may be altered before they become law, so take advice from your own accountant and solicitor before you act. Richmonds accepts no liability for decisions made on the basis of this guide. See our website terms.

Preparing your compliance business for sale: a checklist