Normalized earnings
Profit after resetting owner compensation to market and removing personal, related-party and one-time items. Every adjustment needs support.
Selling a privately held business in Ontario, whatever your industry
Not every business fits a category, and many of the best don’t. Kingston Investments advises owners of established, privately held businesses in a wide range of industries on valuation, buyer identification, negotiations and the sale process, across Ontario from the Greater Toronto Area.
- Who it’s for
- Owners of established private businesses in any industry
- Transaction focus
- $500K–$30M
- In our portfolio
- 52 transactions across nine industry groups
What every buyer wants to know
Industries differ in their details, but buyers of established private businesses ask the same core questions. The answers decide the price, the structure of the offer and how long you stay involved.
What does it really earn?
Profit after resetting owner pay and removing personal and one-time costs, supported by statements a lender will accept.
Will the earnings continue?
Repeat customers, contracts, a spread of accounts and a market that isn’t shrinking.
Does it depend on you?
Who holds the relationships, the know-how and the decisions, and who would run it after you leave.
What has to transfer?
Leases, licences, contracts, permits and intellectual property, and who must agree.
Industries with their own guides
If your business fits one of these, the dedicated guide covers what buyers in that sector look at. If it doesn’t, the rest of this page applies, and we’re glad to talk through what is specific to your industry.
- Manufacturing & industrialSelling a Manufacturing Business
- Wholesale & distributionSelling a Distribution Business
- Business & professional servicesSelling a Professional Services Firm
- Technology & IT servicesSelling an IT Services Business
- Construction & skilled tradesSelling a Construction or Trades Business
- Property & facility servicesSelling a Property Services Business
- Healthcare & related servicesSelling a Healthcare Services Business
- Consumer products & retailSelling a Retail or Consumer Products Business
- Transportation & logisticsSelling a Transportation or Logistics Business
- Food & beverageSelling a Food or Beverage Business
- Education & trainingSelling an Education or Training Business
- Hospitality & personal servicesSelling a Hospitality or Personal Services Business
Not all earnings are valued the same way
Two businesses with the same profit can be worth very different amounts. Buyers sort earnings by how likely they are to repeat, and pay more, and more of it at closing, for the kind higher up the ladder.
- Contracted and recurringMulti-year agreements, subscriptions, memberships and service contracts that continue after a change of ownership
- Repeat customers by habitCustomers who reorder regularly without a contract, spread across many accounts
- Diversified project or one-off salesNew work won steadily from many customers, without a single account dominating
- Concentrated or exceptionalA large share from one customer, an unusual year, or work that depends on the owner’s personal relationships
What determines the value of a private business
Whatever the industry, these are the factors that most often move the price and the terms of an offer.
Quality of financial records
Statements prepared by an accountant, reconciled to tax filings, with monthly results a buyer can follow. Weak records lower confidence and price.
Customer concentration
The share of revenue from the largest customers and how long they have stayed. A few large accounts usually mean more of the price is deferred or at risk.
Owner dependence
Whether managers already run sales, operations and finance. The less a business relies on you, the more a buyer will pay up front.
Growth and market
A credible trend, a market that is stable or growing, and room to expand that a buyer can see for themselves.
People
A stable team with key employees who are likely to stay, and fair pay compared with the market.
Working capital and assets
Receivables, inventory and payables that a buyer expects to find at closing, and equipment that doesn’t need immediate replacement.
Transferability
Leases, licences, contracts and intellectual property that can move to a new owner without disruption.
When your industry has its own rules
Many businesses depend on something a buyer can’t simply take over. These are the questions to settle with your lawyer before a sale.
Licences and registrations
Some are tied to the company, some to individuals, and some can’t be transferred at all. Whether you sell shares or assets often decides what carries over.
Regulated professions
Some professions limit who may own a firm or require consent before client information is shared with a successor.
Franchise and dealer agreements
Franchisors, manufacturers and brand owners usually have the right to approve a new owner.
Real estate and environmental questions
Owned property, leases and any environmental history can affect both structure and timing.
Curious what your business could be worth?
Answer a few questions about your business and its finances, and an advisor will review them and contact you to discuss a preliminary valuation. You don’t need to be ready to sell.
Preparing a business for sale
You don’t need all of this done before talking to an advisor. The earlier you start, the more of it can be in place when a buyer asks.
Two to three years out
- Move to reviewed or audited statements if buyers and lenders will expect them
- Build a management layer that can run day-to-day operations
- Reduce reliance on your largest customer or supplier where you can
- Separate personal expenses from the business
Twelve to eighteen months out
- Prepare normalized earnings with support for each adjustment
- Collect contracts, leases, licences and permits, and check what needs consent
- Confirm the company owns its trademarks, domains and other intellectual property
- Talk to your accountant about structure and tax
Before going to market
- Agree a realistic value range and the terms that matter to you
- Decide what to do with any real estate
- Plan when and how key employees will be told
- Keep running the business well: buyers watch current results closely
Who buys privately held businesses
A well-run sale puts several types of buyer in front of you, because each values different things and structures offers differently.
How our sale process worksStrategic buyers
Competitors, suppliers, customers and companies in related industries. They can often pay for synergies, but may want a longer look inside.
Investor-backed platforms
Holding companies and groups backed by private equity, building in a sector. They focus on management, systems and normalized earnings.
Private equity
For larger businesses with management in place, often with a role or a retained stake for the owner.
Individual buyers
Experienced managers and entrepreneurs buying their first company, usually with bank financing and often some vendor financing.
A cross-section of Kingston’s transactions
Our completed transactions span industrial and manufacturing companies, distributors, professional and technology services, trades, consumer and retail businesses, food and hospitality, and personal services.
Consumer goods
Leading FMCG Company
Deal value $25,000,000
Sold
Kingston advised on the acquisition of a fast-growing FMCG enterprise supplying consumer goods across global markets, with an established brand presence and distribution network.
View detailsDistribution & wholesale
Industrial Pumps & Equipment Distributor with Real Estate
Published value $2,000,000
Sold
View detailsEducation & personal services
Private Music Education & Learning Centre
Deal value Undisclosed
Sold
View detailsFood & hospitality
European Specialty Bakery & Food Production Business
Deal value Undisclosed
Sold
View detailsKingston team introduced several qualified buyers and generated multiple competing offers for my company. The business sold at full asking price and on my terms within a few months, and the transaction closed on schedule as planned.
Questions owners ask
Short answers to the questions we hear most often. Every business is different, so we’re happy to talk through yours.
All FAQsMy industry isn’t listed. Can Kingston still help me sell my business?
Very likely. The guides on this site cover the industries we see most often, but the work of selling a business is similar across sectors: understanding what it really earns, preparing for a buyer’s questions, finding and screening buyers, negotiating and managing due diligence. We focus on established private businesses with transaction values from about $500,000 to $30 million, and we’ll tell you plainly if we aren’t the right fit.
How do I find out what my business is worth?
Start with what it earns once owner pay and one-time or personal costs are adjusted, then ask how dependable those earnings are and who would buy them. Industry, size, growth, customer concentration and owner dependence all affect the answer. To find out what yours could be worth, request a business valuation: an advisor reviews your figures and contacts you to discuss them.
What is the difference between a business broker and an M&A advisor?
A business broker typically lists a business and responds to the buyers who come forward, which suits many smaller, simpler sales. An M&A advisor, sometimes called a business sale advisor, prepares the business for a buyer’s scrutiny, normalizes the financial statements, approaches suitable buyers confidentially, negotiates price and terms, and manages due diligence through to closing. The right choice depends on the size and complexity of the business. For established companies in our range, where confidentiality, the choice of buyers and the terms of the deal matter as much as the headline price, owners usually benefit from an advisor.
How long does it take to sell a private business?
Often six to twelve months from preparation to closing, sometimes longer. Preparation, the number of suitable buyers, financing and the depth of due diligence all affect the timeline. Starting to prepare a year or two ahead gives you more control over it.
Who buys privately held businesses?
Competitors and companies in related industries, investor-backed platforms and holding companies, private equity firms for larger businesses, and individuals buying their first company. Each values different things and structures offers differently, which is why a well-run process puts several in front of you.
Should I sell the shares or the assets of my company?
Owners usually prefer a share sale for tax reasons, and buyers often prefer an asset sale to limit inherited liabilities. The right answer depends on the business, any licences or contracts that must transfer, and your tax position. Involve your accountant early.
How do I keep a sale confidential?
Buyers first see an anonymous profile and sign a non-disclosure agreement before learning your name. Detailed information is released in stages to serious, screened buyers, and staff, customers and suppliers are told only when you decide.
Do I need to be ready to sell before I speak with Kingston?
No. Many owners talk to us a year or more before they sell, to understand value and what to work on. The conversation is confidential and there is no obligation.
Useful reading
What Is Your Business Worth, Even If You’re Not Selling?
Knowing roughly what your business is worth helps with planning long before a sale. Here’s how buyers arrive at a number, and why it comes as a range.
How to Prepare Your Business for Sale Over the Next 12 to 24 Months
A practical timeline for owners who expect to sell in the next year or two, from getting an honest starting point to the months just before going to market.
What Happens in a First Conversation With an M&A Advisor
What you’ll be asked, what to bring, what you should leave with and the questions worth asking in return. No preparation or commitment required.
Confidential conversation
Thinking about selling your business?
Whatever your industry, start with a confidential conversation about your business and what a sale could look like. There’s no obligation, and you don’t need to be ready to sell.