90 days to deal-ready: the due diligence preparation timeline

There's a particular conversation I've had a dozen times in the last twenty years. A founder calls. They've decided to sell the business — sometimes prompted by an inbound from a strategic acquirer, sometimes by life circumstances, sometimes by a long-anticipated exit window finally opening. They want to know what's involved. I ask when they want to be in market. They say "in a few months — the books are good, we should be ready quickly."

The books usually are good. The business has been running for twenty years and the bookkeeping is competent. That's not the issue. The issue is that "the books being good" and "the financial presentation being deal-ready" are different things, and most owner-led businesses haven't built the second thing because they've never needed to.

What accelerates deal-readiness is every number carrying its derivation, source rows and sign-off chain from day one. The same evidence pack that defends a number to a regulator on Friday is the same evidence pack that defends it to a buyer on Tuesday. Same standard, two audiences, one audit-defensible record.

The myth and the reality

The myth: "We're ready, the books are clean."

The reality: there's a difference between bookkeeping being correct (which it usually is) and the financial presentation being deal-ready. Deal-ready means a buyer's due diligence team can walk through your data room in 48 hours and arrive at an EBITDA number they trust, with a normalisation analysis they can defend to their investment committee, with a working-capital trend they understand, with customer concentration risk surfaced honestly.

Most owner-led businesses haven't built that presentation layer. They've built operational financials — which is the right thing for running the business but the wrong thing for selling it. Operational financials answer "did we cover payroll this month, and what was our gross margin." Deal-ready financials answer "what is this business worth to someone who isn't you, and how confident can they be in that number."

The 90-day timeline (the minimum)

If you want to be in market in 90 days, here's what the work looks like. This is the minimum competent timeline; doing it faster usually means doing it badly.

Days 1–14: Discovery

What is the current state of the data? Where are the obvious gaps? What's missing? A structured Financial Systems Review identifies the holes before you try to fill them. The output is a written findings document: data sources mapped, integration gaps catalogued, reclassification work scoped, normalisation candidates identified, customer concentration measured.

Most discovery surfaces 6–12 issues that need work before the business is presentable to a buyer. Some are administrative (cleanup of the chart of accounts). Some are structural (a related-party transaction that needs explicit disclosure and normalisation). Some are commercial (a single customer at 35% of revenue that materially affects the multiple).

Days 15–45: Cleanup

Reclassify miscategorised transactions. Resolve double-counting between systems. Normalise the chart of accounts to a structure a buyer's QoE team will recognise. Build a defensible add-backs list — owner remuneration (where the new owner won't draw the same amount), non-recurring expenses (genuine one-offs, not "we won't have that expense again," which is rarely true), related-party transactions (rent paid to a family trust, services from a related entity).

This is the work that determines whether your normalised EBITDA holds up under buyer scrutiny or gets challenged item-by-item across a 90-minute negotiation that ends with $300k coming off the headline price.

Days 46–75: Presentation

Build the data room. The financial pack is the centre of it: year-on-year P&L with consistent classifications, normalised EBITDA bridge showing every adjustment with rationale, working capital trend across at least eight quarters, customer concentration analysis (top 10 by revenue, by gross profit, by gross profit margin), capex schedule, debt schedule, contracts schedule, employment matters schedule.

Each schedule has a one-page covering analysis that anticipates the questions a buyer's diligence team will ask. The principle: minimise the number of follow-up questions the buyer needs to ask. Every question they ask is a question they could lose confidence on if the answer isn't crisp.

Days 76–90: Quality of Earnings draft

Engage external advisors to produce or review the Quality of Earnings analysis. This is the document buyers will actually rely on — get it right before the first buyer sees it, not after. A QoE produced under sell-side discipline anticipates the buy-side QoE that will follow, addresses its likely findings, and gives you the narrative authority going into the negotiation.

Most sell-side QoEs we've seen are produced too late and too defensively. The right time is before the IM goes out, not after the LOI is signed.

The 12-month timeline (the real one)

90 days gets you deal-ready. 12 months gets you maximum value. The difference is what you can do to the business itself — not just to its financial presentation.

Twelve months out, you can: reduce customer concentration risk by deliberately diversifying the top of the revenue stack; refactor a critical supplier dependency by introducing a second source; hire a 2IC who can demonstrate the business doesn't depend on you (this single move can change a buyer's perception of key-person risk more than any other); run a clean year of audited numbers; document the operational playbook so transition risk goes down; commission an independent valuation as a baseline against which buyer offers will be calibrated.

These changes are what move the multiple from 3–4× EBITDA to 5–7× EBITDA. The 12-month investment is worth approximately 20–40% of enterprise value in our experience — and that's before factoring in the lower transaction risk (deals that close at higher rates) and the lower post-close exposure (warranty and indemnity claims).

If you're going to sell once in your life, do it well. The difference between rushing the prep and doing it properly is usually larger than every other commercial decision you'll make in the year leading up to the sale.

The commercial structure that aligns interests

Most advisory firms charge for sale-prep work up front, regardless of whether the deal closes. We don't think that's the right structure. For work directly related to sale preparation, we discuss deferring fees until settlement — paid out of sale proceeds, not out of operational cash flow.

The commercial logic: if we're doing our job well, the business is in better shape and the deal closes at a higher multiple. We share in that outcome. If the deal doesn't close — for any reason, including reasons outside the founder's control — we've taken on the risk alongside the founder rather than extracted fees from a business that's already under pressure.

This isn't a contingency fee in the traditional sense. The hourly rate is pre-agreed and pre-approved. The structure is just that the timing of payment is settlement-conditional. The founder isn't gambling on whether to engage. The advisor isn't gambling on whether they'll get paid. Both parties are betting on the same outcome — that proper preparation leads to a higher-quality sale process — and the commercial structure makes that bet legible.

What we do

Newport Pembury runs sale-preparation engagements as a defined three-tier structure:

• Initial Assessment (one-off, ~7 days). System access, scoping, written findings report with prioritised next steps.
• Monthly Retainer (during the prep window, ~22 hours per month). Weekly cashflow management, monthly variance analysis, supplier prioritisation, performance dashboards focused on liquidity rather than growth metrics — keeping the operating business stable while the sale-prep work runs alongside.
• Sale Preparation (pre-approved, fees deferrable to settlement of the property and/or business sale, whichever occurs first). Business valuation, normalised earnings analysis, data room assembly, due diligence support, buyer Q&A coordination through to settlement.

The combined effect is a defensible data room, a normalised earnings analysis that holds up under buyer scrutiny, a draft QoE that anticipates the buy-side QoE that will follow, and buyer-Q&A support that lets the founder run the business while we handle the diligence machinery.

For the Hunter Valley pet industry operator we're currently working with, the fee-deferral structure was the difference between being able to prepare the sale properly and having to muddle through. Sale-prep done properly typically pays for itself many times over in the final transaction multiple — but only if the commercial structure lets the work actually happen.