Is My Business Big Enough to Sell in the UK?

If your UK business turns over less than £1 million and is only marginally profitable, a third‑party sale is possible but often difficult. Cross the £1 million revenue mark and deliver consistent profits and the picture improves markedly. As a rough guide, £250k+ of sustainable profit usually attracts credible trade interest. 

Hit £1 million+ profit (or c. £1m EBITDA) and the buyer universe opens up further, often including larger trade groups and some private equity backed platforms, which can improve competitive tension and outcomes. Size alone is not everything though. 

Owner dependency, poor financial records, customer or supplier concentration, and legal or compliance gaps can still derail a deal. That is exactly where Dexterity Partners’ integrated preparation, legal alignment with 3Volution, and our Fit to Sell and Fit for the Future programmes make the difference.

Why “big enough” matters

Buyers assess three things very quickly: scale, profitability, and risk. Scale and profit determine whether the business is worth the cost and complexity of a transaction. Risk determines whether the buyer will actually proceed and on what terms.

• For businesses delivering roughly £250k–£1m profit, the buyer universe typically includes established trade acquirers in your niche, PE‑backed platforms executing bolt‑ons, and funded owner‑operators or management teams (MBO/MBI). Appetite is strong where profits are sustainable and transferable, with valuation driven by maintainable EBITDA and cash conversion.
• In the UK lower mid‑market, professional investors and larger corporates tend to focus on deals from roughly £10 million enterprise value upward, and many private equity funds concentrate on businesses with multi‑million pound EBITDA. That does not mean smaller firms cannot sell; it simply means the universe of buyers narrows and diligence expectations do not.
• The private equity and private capital ecosystem is active in the UK and funds frequently back buy‑and‑build platforms in which they acquire profitable, well run SMEs to bolt together. As profit increases, so does the range of PE‑backed and larger trade acquirers that can participate in your process.

Revenue vs profit: what buyers really watch

Turnover is vanity; profit and cash are reality in deals. While revenue shows market presence, buyers price businesses on maintainable profits (often EBITDA) and cash conversion. For many UK SMEs:

• Under £1m revenue and low or inconsistent profits: sales are possible but usually limited to local trade buyers, competitors, management buy‑ins, or individuals. Processes can be slow and sensitive to perceived risk. Unless you have a very high profit margin, we usually recommend growing rather than selling a company at this stage.
• £1m+ revenue with c. £250k+ profit: now you are typically on the radar of more trade acquirers. That profit level tends to indicate an organisation with processes, a team beyond the owner, and the ability to absorb deal costs and a handover.
• £1m+ profit (or EBITDA): this is a notable benchmark. At this level, larger trade buyers and some private equity backed platforms often take more interest, creating more competition and optionality in the process.

None of these numbers are strict rules. They are sensible waypoints drawn from how UK buyers segment the market. The right preparation can help smaller yet high‑quality businesses transact well, just as poor preparation can sink larger ones.

Who buys businesses at different sizes?

Sub‑£1m turnover or modest profit

Likely buyers:

• Local or regional competitors wanting customers or staff
• Owner‑operators and individual investors
• Strategic buyers seeking specific IP, contracts or geography

Typical friction points: funding certainty, vendor reliance, thin management bandwidth to run a full process, and buyer diligence fatigue.

Usually not possible to sell, or if a sale does complete it is for a very low value.

£1m–£5m turnover and c. £250k–£1m profit

Likely buyers:

• Trade acquirers in adjacent or overlapping niches
• Larger SMEs executing bolt‑ons
• Select PE‑backed platforms doing buy‑and‑build

Why they like it: enough profit to professionalise, invest and integrate; scope for synergy; more robust reporting.

£1m+ profit

Likely buyers:

• Trade acquirers in adjacent or overlapping niches
• National or international trade groups
• Private equity backed platforms and, in some cases, direct private equity if the business profile fits their mandate

Why they like it: scalable economics, clearer leadership bench, professional finance function, and the ability to support debt or further acquisitions.

Non‑size issues that stop a sale

Even if your numbers are solid, several common issues can cause buyers to walk or reduce price.

1) Customer concentration

Buyers get nervous if a small number of customers account for a large chunk of revenue or margin. That usually means lower offers, more conditionality or earn outs.

Quick fixes:

• Reduce exposure to any single customer and put written, assignable contracts in place.
• Extend terms on key accounts and deepen contact beyond the founder.
• Evidence retention and pipeline so buyers can see stability.

2) Owner dependency

If everything runs through you, buyers worry performance will dip after completion. That often leads to longer handovers and price chips.

Quick fixes:

• Empower a second tier to own sales, operations and finance.
• Document the top processes and move key relationships to the team.
• Build a simple 3 to 6 month transition plan that reduces your hours.

3) Weak or messy financials

Deals slow or stall when the numbers are unclear. Buyers price profits they can verify, with strong cash conversion.

Quick fixes:

• Produce monthly P&L, balance sheet and cash flow with reconciliations.
• Clarify revenue recognition, stock/WIP and normalisations to EBITDA.
• Prepare a clean data room and a short quality of earnings style pack.

4) Legal gaps

Missing IP assignments, vague contracts or data protection issues create execution risk and invite re‑trades.

Quick fixes:

• Audit core contracts for change of control and assignment rights.
• Tie down IP ownership and update employment terms and policies.
• Close obvious GDPR and regulatory gaps ahead of launch.

5) Valuation disconnects

Headline multiples mean little without context. Buyers value maintainable profit, risk and terms.

Quick fixes:

• Set a range based on normalised EBITDA, cash conversion and relevant comps.
• Agree the price mechanism and working capital approach up front.
• Run a competitive process to create tension among credible bidders.

How Dexterity Partners raises your odds of a successful sale

Plenty of owners attempt a sale with a broker that simply “finds a buyer”. That leaves the hardest work to you: shaping the narrative, negotiating terms, surviving diligence, and completing without surprises. 

Dexterity Partners operates differently for UK owners in the £1m–£50m revenue band, with a sweet spot of £500k–£5m profit. Our integrated model aligns corporate finance advice with legal execution through our sister firm 3Volution, so you are supported end‑to‑end.

Fit to Sell: de‑risk and value‑up before you launch

We assess your business across buyer‑critical dimensions:

Financial quality

We build a vendor‑ready financial story that stands up to diligence.

Key analyses:

• Bridge from statutory to management figures and to normalised EBITDA.
• Detailed schedule of normalisations and one‑offs with evidence.
• Monthly P&L, balance sheet and cash flow for 24 to 36 months with reconciliations.
• Working capital profiling by month, seasonality and a target at completion.
• Cash conversion waterfall and capex vs opex profile.
• KPI set aligned to buyer expectations, including gross margin by product and cohort.

Commercial story

We evidence the drivers of growth and durability so buyers can underwrite the plan.

Key analyses:

• Market mapping, competitor landscape and positioning.
• Cohort, retention and lifetime value analysis; CAC payback and unit economics.
• Pricing and discounting review; win/loss analysis and sales cycle diagnostics.
• Pipeline quality and conversion by stage; channel effectiveness.
• Customer and supplier concentration.

Operational readiness

We show the business can scale and operate without the owner.

Key workstreams:

• Organisation design and succession, with owner‑dependency map.
• SOPs for the top revenue and cash processes; capacity and fulfilment mapping.
• Systems landscape and data quality..
• Supply chain resilience, vendor scorecards and service level adherence.
• Cyber hygiene, disaster recovery and health and safety evidence.

Legal hygiene (with 3Volution)

We remove avoidable legal friction before buyers look.

Key workstreams:

• Corporate structure review, cap table and shareholder consents.
• Contract audit for customers and suppliers, including change of control and assignment.
• IP chain of title and registrations; brand and domain audit.
• Employment documentation, policies and incentive schemes.
• Data protection compliance and security posture; regulatory licences.
• Property, leases and consents; disputes and claims triage.

The result is a sell‑side pack that stands up in diligence and reduces price chips and conditionality.

Fit for the Future: the growth lens buyers pay for

Beyond today’s numbers, sophisticated buyers pay for tomorrow’s potential. We work with you to evidence:

• Contracted or highly visible revenue
• Clear levers to scale margin
• Pipeline mechanics and unit economics
• Post‑deal integration opportunities

This makes your equity story resonate with trade acquirers and PE‑backed platforms that need credible growth to justify their models.

Integrated legal through 3Volution

Because legal and commercial negotiations are intertwined, our process planning includes a legal issues log from the outset, mapped to the heads of terms you want to achieve. That alignment improves speed, reduces duplication, and helps keep you on the front foot when the data room opens.

What “good” looks like at different sizes (illustrative)

These are directional, not rules. Every business is unique, and well‑prepared smaller firms can achieve great outcomes.

Under £1m revenue

• Likely buyer pool: local or adjacent trade buyers, micro‑consolidators, funded individuals and MBI candidates.
• Typical valuation and deal shape: values are usually modest relative to turnover and driven by maintainable profit and transferable contracts. Many buyers prefer an asset sale rather than a share sale. Upfront cash can be limited, with deferred consideration, vendor loan notes and earn‑outs common.
• Common structures: asset purchase with TUPE transfers, staged payments over 12–36 months, warranties focused on title and contracts rather than complex tax.
• What good looks like: very high gross margins or sticky recurring revenue, clear differentiation or defensible IP, simple operations, tidy accounts and assignable contracts.
• Preparation priorities: reduce owner dependency, diversify any single large customer, put written contracts in place, cleanse your data room, and resolve basic legal items such as IP assignments and employment terms.
• Red flags: one customer representing 40%+ of sales, no written contracts, the owner is the primary salesperson or technician, short or precarious property arrangements, or regulatory gaps.
• Practical recommendation: unless you have a very high margin or a clear strategic fit for a specific buyer, growing rather than selling is usually the better route at this stage.
• Indicative timeline: 3 to 6 months with a local or strategic buyer once preparation is complete.

£1m–£5m revenue with £250k–£1m profit

• Likely buyer pool: trade acquirers in adjacent or overlapping niches, larger SMEs executing bolt‑ons, and PE‑backed platforms pursuing buy‑and‑build.
• Value drivers: recurring or contracted revenue, strong gross margins and cash conversion, low customer concentration, and a credible second tier of management.
• Typical process: targeted outreach to curated buyers, NDA and teaser, information memorandum and virtual data room, management meetings, non‑binding offers, heads of terms, diligence and completion. Total elapsed time typically 6 to 9 months.
• Common structures: share sale with either a locked‑box or completion accounts mechanism, partial earn‑out of 12–24 months where growth is a key value driver, selective W&I insurance where appropriate.
• What good looks like: a CFO or strong controller, monthly MI with reconciled balance sheet and cash flow, a 12–24 month bottom‑up forecast, defined KPIs, clear IP ownership, GDPR and HR documentation in place, and a people plan for retention.
• Preparation priorities: vendor‑style Quality of Earnings, working capital target analysis, contract and IP clean‑up, options and employment tidied, data protection documentation, property and lease reviews.
• Mistakes to avoid: launching before legal and financial hygiene is complete, weak forecasting discipline, setting price expectations from anecdotes, failing to run a competitive process, and loose confidentiality management.

£1m+ profit

• Likely buyer pool: trade acquirers, national or international trade groups, PE‑backed platforms, and in some sectors direct PE funds.
• What is different at this level: expect full vendor QofE, comprehensive legal readiness, a structured auction with multiple rounds, and deeper management presentations. Locked‑box pricing, W&I insurance, and management equity rollover are common.
• Value drivers: size premium and market leadership, demonstrable growth runway, synergy potential for buyers, repeatable unit economics, and a strong management bench.
• What good looks like: a CFO‑led finance function, robust controls and MI, a detailed 3 year plan, a documented bolt‑on pipeline or integration plan, succession for key roles, and well‑designed incentive schemes.
• Preparation priorities: strengthen the executive bench, complete carve‑outs of non‑core activities if relevant, tighten SaaS or cohort metrics where applicable, complete ESG, health and safety and cyber audits, and build a 90‑day integration plan.
• Negotiation levers: locked‑box interest and leakage protections, warranty caps and baskets, the balance between earn‑out and rollover, and alignment of governance post‑deal.
• Indicative timeline: 6 to 12 months from launch to completion depending on sector and buyer approvals.

The buyer universe widens as profit grows

As profitability passes the £1m EBITDA mark, you typically see more interest from PE‑backed consolidators and, depending on sector, direct private equity (Read more about Selling to Private Equity: A guide for UK Businesses). In practical terms, that means more credible suitors and better leverage in negotiations once your profits are there.

Valuation: how size and readiness interact

Valuation is rarely a single number; it is a range influenced by:

• Maintainable EBITDA and cash conversion
• Growth visibility: order book, contracted revenue, retention
• Risk factors: concentration, key person reliance, compliance
• Synergies: what a buyer can save or cross‑sell post‑deal
• Competitive tension: the number and type of serious bidders

Planning well before you want to sell matters because preparation shifts all five levers in your favour.

Process: why project management matters as much as price

The journey from “interested buyer” to “cash in bank” involves six integrated stages. Dexterity Partners manages each, shoulder‑to‑shoulder with 3Volution:

1. Preparation
   Fit to Sell and Fit for the Future diagnostics; legal readiness; financial normalisations; data room build.
2. Buyer identification
   Targeted, research‑led mapping of strategic and financial buyers, not spray‑and‑pray mass emails. The goal is confidentiality with maximum relevance.
3. Marketing
   Compelling, evidence‑backed materials that speak to synergies and scale, framed to anticipate commercial and financial diligence.
4. Negotiation
   Heads of terms that reflect economics and risk allocation: price mechanism, earn‑outs, working capital, warranties and indemnities.
5. Due diligence
   We run a proactive issues log and track‑change responses to keep momentum and minimise value erosion. (Read our Complete Guide to Due Diligence in Selling Your Business)
6. Completion
   Legal document execution, funds flow, disclosure, and post‑completion actions. Early legal integration shortens this phase and reduces last‑minute surprises.

Timing your sale

Markets ebb and flow, but preparation beats timing luck. In recent periods, UK mid‑market activity has been resilient, and private capital has remained a significant and stable source of funding for UK companies. That backdrop supports quality processes, particularly for prepared sellers.

FAQs about the size of your business

Is my business too small to sell if I turn over under £1m?
Not necessarily, but the buyer pool is narrower and outcomes depend on profit quality, transferability and risk. Expect more selective interest and a more relationship‑driven process.

What is the simplest profitability signal buyers like to see?
Sustainable £250k+ profit with clear evidence it is repeatable. That threshold often marks the transition from “owner‑dependent” to “institutionally investable” in the SME space.

When do private equity backed buyers get interested?
Some platform strategies engage earlier, but a £1m+ profit business typically attracts a wider array of PE‑backed acquirers and, in some sectors, direct PE.

What are the most common deal killers?
Customer concentration, owner dependency, messy financials, and legal or regulatory gaps. All are fixable with time and planning. Read more about How to Avoid Deal Killers When Selling a Business

How long should I allow to prepare?
Begin shaping your exit 12–24 months in advance where possible. Planning improves valuation and reduces headaches.

A simple self‑check: are you likely “big enough” today?

• Revenue: Are you at or above £1m?
• Profit: Are you delivering £250k+ maintainable profit with good cash conversion?
• Team: Can the business operate without you for several weeks?
• Customers: No single customer over 20–30% of revenue?
• Financials: Robust monthly management accounts, reconciled and explainable?
• Legal: Contracts, IP and employment matters documented and compliant?

If you answered “yes” to most of these, you are likely sale‑ready from a size perspective. If not, the right preparation plan can close the gaps.

What to do next

1. Get an objective readiness assessment.
   Dexterity Partners’ Fit to Sell gives you a clear action plan across financial, commercial, operational and legal readiness so you know exactly what to fix and in what order.
2. Map your true buyer universe.
   We research and prioritise the buyers who will value what you have built, not just those on generic lists.
3. Sequence the process to protect value.
   From heads of terms to diligence to completion, we coordinate the workstream and keep momentum.

How we can help

Are you big enough to sell you business?? 

If you are over £1m revenue and delivering £250k+ profit, the answer is often “yes” with the right preparation. Cross £1m profit and your buyer options typically broaden further, sometimes including private equity backed platforms. Just remember that size is only half the story. The businesses that sell well are the ones that prepare early, remove friction, and present a credible, future‑focused growth case. That is precisely what our integrated Dexterity Partners and 3Volution model is built to deliver for UK owners.

If you would like a confidential chat about whether now is the right time for your sale, get in touch and we will give you a straight, data‑led view.