How to sell my engineering business?

You might be wondering:
– How can I sell my engineering business?
– How can I sell my engineering company?
– How can I sell my engineering firm?
– How much will my engineering business sell for?
– How do I determine an asking price to sell my engineering business?
– How do I find potential buyers to sell my engineering business ?
– How do I sell my engineering business through a broker?

On the last question: Use a broker when you only need a connection to a buyer (i.e. when selling real estate or stocks). Instead, use an M&A advisor when selling your business because what you need is vastly more complex. Details on that and more answers are ahead

Think Years, Not Months

If you’re thinking that you will be able to sell your engineering business to a worthy successor and then walk away after closing, it isn’t possible.

Much of the value of any business is tied to its owners — to their expertise, reputation, and relationships. In most successful sales, that value is transferred to a successor over a multi-year transition during which the seller works 2 to 35 hours per week. The seller should have a salesor profit-sharing incentive to complete an effective transition. Consequently, most businesses cannot simply be sold for just a fixed payment at closing. This is especially true for selling a small business and applies to all businesses to varying degrees, and largely depending on the size of the business.

Seller Beware: Protect Yourself

Because selling a business entails sharing sales or profit with a buyer you have just met, you
need protection. We recommend the following:
(1) List the adverse outcomes that can occur. For each, design a resolution mechanism that protects your assets.
(2) List the possible disputes that can arise between you and your buyer. For each, implement a binding procedure for resolving t

Deep expertise in designing protection mechanisms matters. (Hint: We are exceptional at it.) Layers will draft the legal language that implements protections in a contract, but only a capable advisor can design protection mechanisms. Proper protection design requires economics and finance expertise, not legal expertise.

Sell by Auction or Not?

You might be seeking exit strategies for your engineering business that may have a suitable successor within the business itself.

Did you know you can sell your business via an auction? If you have a strong preference for orderliness, then an auction can be perfect for you.

The first step in selling an engineering business is selecting one of two sale mechanisms:

Option 1: Auction Mechanism
If you wonder “how do I sell my engineering business for maximum price,” look here:
There are several differences between the auctions we see in movies and an auction
mechanism for selling an engineering business. Here are a couple:
(1) Bids will entail several numbers in addition to purchase price. For example, the percent of the price paid through a multi-year seller note and your compensation during the transition period are two other numbers that could be included in a bid.
(2) The winning bidder will be selected based on a valuation formula that calculates how much each bid is worth to you, so you know when you should sell your veterinary practice.
(3) The bidders will not be aware of each other’s bids.

What are the benefits if I want to sell my engineering business via auction?

(1) If we have at least two bidders, then an auction will generate more value for you than an adhoc mechanism. This is how to sell a business to a successor for a maximum price.
(2) The business is more likely to end up in the hands of the right person.
(3) The high amount of structure required for an auction forces everyone to produce and act upon a high degree of clarity early in the process. This reduces the likelihood of the deal falling through late in the process.

What are the disadvantages if I sell my engineering business via auction?

(1) There is somewhat more work to do upfront: (a) Closing documents need to be generated upfront rather than late in the process. (b) We need to decide upfront on precisely how you would value different possible deal structures.
(2) You have less flexibility. Once you have executed an auction agreement with the prospective acquirers, you cannot back out of it.

Option 2: Ad Hoc Mechanism

If you’re thinking, “I want to sell my engineering business the old fashioned way, and an auction sounds too complex,” look here:

In this mechanism, we negotiate with each prospective buyer one-on-one. If you like what someone offers, you move forward with them. If you are uncertain about their offer, we ask them to wait until we have more offers.

What are the benefits of selling my engineering business via ad hoc mechanism?
(1) Less work is required before engaging prospective buyers.
(2) You commit practically nothing to the acquirer until final closing documents are signed which is relatively late in the process. This implies that you are free to change your mind until then.

What are the disadvantages if I sell my engineering business this way?

(1) If you ask a prospective buyer to wait until you have fielded more offers, you risk losing
them because they might find another opportunity.
(2) The best prospective buyer might drive a hard bargain, offering too little. A less qualified prospective buyer might not drive such a hard bargain. As a result, you might go forward with the less qualified buyer. It is important that we find the best buyer because everyone wins when that is the case.
(3) Because this is a less structured process, with less agreed upon upfront, it is more likely that the deal will fall apart after a non-binding offer is accepted. This can result in significant lost time, money, and energy.

Optimal Deal Structure

If an owner commanded, “Sell my engineering business for the highest possible price!” then I would say, “Be careful what you wish for. You probably wouldn’t sell at a price of $10 million paid over 100 years with a 0.1% interest rate.”
The correct mandate is, “Sell my engineering business under a deal structure that maximizes the net present value of my future cash flows, considering expected and worst case scenarios, and that allows me to exit comfortably on my realistic timeline.”

Deal structure is the set of terms in your sale contract that affect the timing, contingencies, and amount of payments you receive.

In the business world, successful firms have long-term clients for which they perform annual services related to audits, taxes, and financial reporting. It can be sensible for some of your payment to be tied to the retention of these long-term clients.

If you are open to a broader array of deal terms, you will have a larger pool of prospective acquirers. That translates to extracting more value out of your firm. For example, if a handful of clients comprise a large portion of your services revenue, then it will be difficult to attract buyers without tying part of your sale price to the retention of those big clients

How much do engineering businesses sell for?

The deal structure is equally as important as the purchase price. If you want to sell your
engineering business, you can value it in two ways:

(1) Discounted cash flow method. We will analyze your current client relationships and marketing mechanisms. Based on that, we will project your revenue in future years under a best case, worst case, and expected case scenario. We will project your costs and expenses
given their current levels. This will allow us to project your firm’s operating cash flows under each scenario. We will then sum up the values of each future year’s operating cash flow, discounting it by dividing it by (1+r)^number of years in the future. We will determine the value of r by analyzing the volatility of your historic cash flows relative to historic stock market

(2) Comparables method. We have data on past sales of veterinary clinics. Using comparable sales data, we will infer the value of your firm. For example, we know that the median engineering firm sold for 1.94 times the seller’s discretionary earnings. That is low. Using the optimal deal structure and selling mechanism, we can achieve a higher valuation than that. If you are still wondering, ‘’Should I sell my business’’, then our approach will most likely remove all doubts.

What are the steps to sell my business?

(1) Consultation. If you contact us at or 407-256-1482, we will provide more information tailored to your engineering business regarding everything on this page. From this conversation, you will understand your options.

2) Valuation. We will conduct a valuation by the above methods. If you wish to sell your engineering business via an auction mechanism, we will develop a model enabling us to value every acceptable deal structure.

(3) Materials Preparation. We will prepare a 50-page memorandum, 2-pager, and brief messaging that we will use to convey the opportunity of buying your business. If you wish to sell via auction, we will work with our economical attorney or yours to develop the auction and closing documents.

(4) Targeting. We will determine the criteria for the companies and individuals that would be suitable acquirers of your business. Criteria can involve size, geography, specialty, years of experience, and more.

(5) Outreach. We will contact buyers in several different ways, including contacting some of the 28,000 buyers in our network, sending direct messages to other individuals and companies who meet your criteria, and online advertisement on business for sale websites and professional job boards. We will only introduce you to the most qualified prospects.

(6) Negotiation. We receive offers, improve them, and work to pick the best one. If we are using an auction, negotiation is automatic.

(7) Due Diligence and Closing. The winning bidder conducts due diligence on your business. If we are using an ad hoc mechanism, then in parallel their attorney produces closing documents. Once all of that is concluded, the deal is closed.

(8) Post-Closing. We will be available to help make your business sale successful. We can create accounting dashboards that calculate the payments you are owed. We are also available to act as administrators in any dispute resolution process described under the “Seller Beware: Protect Yourself” section.

Examples of engineering business listings

For you to get a sense of what is on the market, here are some recent listings

Asking Price: $500,000
Cash Flow: $161,621
Price Multiple: 3.1x
Revenue: $810,454
Employees: 10
For sale is a well-established Gulf Coast Firm that provides clients with civil and environmental engineering and land surveying services. These services are provided for counties, cities, water and wastewater utilities, architects, engineers, land developers, school districts, the Department of Defense and other governmental agencies. The majority of the revenue is generated from
repeat customers.

Asking Price: $525,000
Cash Flow: $65,000
Price Multiple: 8.1x
Revenue: $239,2004
Employees: 4
While the business originally concentrated on land surveying it has evolved into a civil engineering organization with the surveying component playing an important support role. It was founded in 1980 as an asset of DesJardins, Tuttle, Inc. but can be acquired either as a corporation or as an individual small business.

Asking Price: $22,778,069
Cash Flow: $2,604,513
Price Multiple: 8.7x
Revenue: $18,062,858
Employees: 300
22-year old International Engineering firm with locations in the US, China, and Latin America. This Engineering firm is well known in South America, where they have seen great growth. The firm specializes in the design of fluid transport systems for long distance pipelines in the mining industry. The transport of ore, concentrates, tailings, water, and chemicals has been their main

Asking Price: $268,000
Cash Flow: $142,217
Price Multiple: 1.9x
Revenue: $363,183
Employees: 4
Retirement beckons, 23 years running a Civil Engineering firm and the seller has decided it is time to pass on the baton to another professional.

Asking Price: $750,000
Cash Flow: N/A
Price Multiple: N/A
Revenue: N/A
Employees: 6
I am selling a small 17 year old structural engineering business to a strategic buyer, who can maintain a high-level of service to clients and provide ongoing opportunities for employees. Then the owner would transition to an advisory role and retire in 2 years. We offer professional structural engineering and CAD drafting services throughout the US. and Canada. Current Owner professionally licensed in multiple states.

Asking Price: $169,000
Cash Flow: $121,851
Price Multiple: 1.4x
Revenue: $181,419
Employees: 1
This Company is a 25 year-old structural engineering firm recognized for outstanding work for many high-profile clients.

Asking Price: $125,000
Cash Flow: $42,871
Price Multiple: 2.9x
Revenue: $311,358
Employees: 5
This business for sale is an Engineering firm in business for over 60 years. Business is focused on material handling with a niche in the water treatment and industrial sectors throughout the US. Company acts as a sub-contractor to design and install heavy

We make selling businesses easy and lucrative

At Next Bridge Advisors, we sell engineering business firms anywhere in the United States. Having been established for 13 years, we have built a network of 28,000 buyers and a unique combination of expertise in the finance, marketing, structuring, and dispute prevention aspects of business sales.

Email us at or learn how to maximize your earnings from selling your business. We shall be happy to answer all your questions.

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