Lessons from the field
Business Brokering in the Time of Coronavirus: How to Keep a Business Sale Alive in a Crisis
In March 2020, deals that were days from closing froze overnight. Business broker Abe Jenners had contracts and closing dates on hold, and a bar owner ready to cut his price by 75%. Here's how brokers kept deals alive in the first weeks of the pandemic, the lessons that apply to any recession or crisis, and a free checklist for rescuing a stalled deal.
Quick answer
When a crisis or recession hits, most business sales don't die; they stall. The first job is to tell the difference: a deal is on hold until a buyer formally withdraws or the contract lapses. Brokers keep stalled deals alive by staying in close touch with both sides, documenting new closing dates in writing and offering ways to bridge the gap, such as a lower price, more seller financing, a longer payout, an earnout, a delayed closing or a different transition period. Sellers often become more motivated in a crisis, so brokers should also protect them from panic pricing. Businesses that meet everyday needs, such as laundromats, auto repair and food production, tend to keep selling, and remote closings with e-signature and video calls let deals close even when no one can meet. A free, printable deal rescue checklist is available to download from this article.
March 2020: everything on hold
As a business broker of 15 years, Abe Jenners is accustomed to waiting. Waiting on buyers, sellers, lawyers, accountants and landlords is part of what he calls “the hustle.” In March 2020, the coronavirus gave waiting a whole new meaning.
“I had a bunch of deals ready to go and everything is on hold. I mean, I had contracts and closing dates on a couple of them. Honestly, it has been very tough.”
Abe, a Georgia native who now works from the Pacific Northwest, has his own approach, what he calls his “business broker in the time of Coronavirus cocktail.”
“First, I tell everyone that deals are not dead. They're on hold, which is the truth. Unless a buyer pulls out officially, we're still in contract. If they want to pull out, I try to get the seller to accept a lower price or different terms, like a longer payout. Anything to keep it alive.”
Motivated sellers, and a 75% price cut
“At the same time that many buyers are not willing to go forward, we have sellers who are more motivated than ever to get out.”
“In one case, I had a bar owner drop his price of his place by 75%.” The owner wanted to return to his country of origin, and told Abe:
“Abe, I'm happy to be alive and I made quite a bit off this place. I'll take this amount and open a place in Portugal once this craziness is over.”
What brokers everywhere were seeing
Abe's story mirrored just about everything I was hearing from brokers around the world.
“Now, 75% price reduction is pretty radical, but I'm hearing the same thing even in places that haven't been hit as hard, like New Zealand and Kentucky. Deals are still happening, but not nearly at the same prices. Or things are on hold indefinitely. It's a tough time.”
Some of the usual obstacles were moving in unexpected directions.
“Lots of times, landlords are obstinate or slow to move. Right now, they're moving at a better pace only because they're concerned that they might not get any rents if they allow a business to go under, rather than just putting it on hold.”
“Also, lawyers and accountants for buyers are trying to discourage sales more than ever, or at least get deep discounts. That's par for the course.”
Something new was happening on the sell side too. One client in Western Europe told me a seller's own lawyer was advising him to “take whatever you can get,” because “you have too much debt to continue.”
“The northeast US is really hard hit, but some places are worse for business than others. I heard that one closing is going to take place remotely since no one wants to be in the same room. But the fact that it's taking place is pretty remarkable in itself.”
The business? “An auto repair center in eastern Pennsylvania. People still need cars, even if they aren't driving as much. And the buyer already has another in the center of the state, so the broker told me he knows what he's doing.”
On hold, delayed and dead
Back in the Pacific Northwest, Abe had one closing delayed. “Not canceled,” he stressed. Another deal was definitely dead, which didn't surprise him: the two sides already had plenty of issues, including how long the payment would take and how long the owner would stay to train the buyer.
Then there was a dry cleaner and laundromat, whose buyer and seller had paused.
“That one's a dry cleaner and laundromat in one place. Those places are never going to close. They are cyclical. Revenues might be down, but there will always be income, even in the worst of times. They will eventually come back. People need clean clothes.”
“I have a feeling they'll come back together. They broke it off once before. The price might change and so might the conditions. But I'm pretty sure there will be a closing once the worst of Coronavirus passes.”
And there was good news, too. A small industrial bakery kitchen was set to close on March 31. “People gotta eat,” Abe said.
On hold or dead? How to tell
A deal is on hold, not dead, until the buyer formally withdraws, the contract lapses or one side clearly can't perform. That distinction, Abe's first rule, decides what a broker does next.
| On hold | Dead | |
|---|---|---|
| Contract | Still in force, or extended in writing | Formally terminated or lapsed |
| Buyer | Still talking, waiting for clarity | Has withdrawn or stopped responding |
| Financing | Delayed, or needs restructuring | Withdrawn with no alternative |
| Seller | Still wants to sell, maybe on new terms | Has taken the business off the market |
| Broker's job | Keep both sides talking and bridge the gap | Reopen marketing, and call backup buyers |
6 ways to keep a stalled deal alive
Abe's rule was “anything to keep it alive.” In practice, brokers have a handful of tools for bridging the gap between a nervous buyer and a motivated seller:
| Tool | How it helps | Watch out for |
|---|---|---|
| Lower price | Reflects new risk and gets the buyer back to the table | Panic pricing the seller will regret |
| More seller financing | Reduces the cash and bank debt the buyer needs | The seller's risk if the business struggles |
| Longer payout | Spreads payments so the business can carry them | Make sure the note is secured |
| Earnout | Ties part of the price to future results | Clear, measurable targets agreed in writing |
| Delayed closing | Buys time for clarity without restarting the deal | Put new dates in writing, with an end date |
| Different transition or training period | Gives the buyer confidence the business will run | Seller availability and cost |
Most of these trade some of the seller's certainty for a deal that actually closes. A good broker lays out the options honestly, and sometimes the honest answer is that a deal should end. (See when should a business broker tell a client to walk away?)
Protect sellers from panic pricing
Abe's bar owner cut his price by 75% and was happy to do it. Not every seller should. In a crisis, some sellers want out at any price, and some advisors, like the Western European lawyer, will encourage it. A broker's job is to make sure the seller's decision is informed: what the business has earned, what it's likely to earn after the crisis, and what the alternatives are, from waiting to restructuring the deal.
Sometimes a quick sale really is the right answer. But it should be the seller's choice, made with the full picture, not a reaction to a frightening week.
Landlords, lawyers and accountants in a downturn
- Landlords may move faster than usual, as they did in 2020, because a tenant who sells is better than an empty unit. It's a good time to ask for a lease assignment or extension.
- Buyers' lawyers and accountants often push harder for discounts, or advise against buying at all. Expect it, and come prepared with numbers.
- Sellers' advisors may push for a quick exit when debt is high. Make sure the seller understands every option.
Which businesses keep selling in a crisis?
The deals that kept moving in March 2020 had something in common: they met everyday needs. Clean clothes, working cars and food don't stop in a crisis, even when revenue dips.
- Laundromats and dry cleaners. Abe's point: revenue might fall, but there's always income. (See Never Neglect Your Business for what it takes to run one.)
- Auto repair. People still need cars, even when they drive less.
- Food production and essential food service. “People gotta eat.”
- Businesses run by buyers who already know the industry, like the auto repair buyer who already owned a shop. Experience makes lenders and sellers more comfortable. (See should a business broker specialize?)
A broker with a mix of listings across industries feels a crisis in one part of the pipeline, not the whole thing.
How to close a business sale remotely
- Agree on the process in advance. Buyer, seller, attorneys, lender and broker agree how and when each document will be signed.
- Share documents securely. Use a data room or secure portal instead of email attachments.
- Verify identities. Confirm everyone is who they say they are, by video call if needed. Some documents may need notarization; check the rules where the deal closes.
- Sign electronically. E-signature lets every party sign from anywhere, with a record of who signed what and when. (Vertica Sign.)
- Transfer funds, keys and passwords. Agree how the money moves, and how the seller hands over keys, codes, accounts and passwords.
Free download: Deal Rescue Checklist (printable PDF)
Everything you need when a deal stalls, on one page: how to tell if it's on hold or dead, what to check first, options to offer the buyer and the seller, scripts for those difficult calls, a remote closing checklist and when to walk away. Download the free deal rescue checklist (PDF).
Scripts for the hardest calls
To a nervous buyer: “I understand. Nobody knows exactly what the next few months look like. Before you decide anything, let's look at what would make this work for you: a different price, more seller financing, a longer payout or a later closing. The deal is on hold, not dead.”
To a seller who wants to cut the price: “I'll support whatever you decide. Before you do, let's look at what the business has earned, what it's likely to earn once this passes, and whether better terms could get you a better price than a big cut.”
To a buyer who's gone quiet: “Just checking in on the [business]. We're still under contract, and the seller is still committed. Can we set a time this week to talk about next steps?”
How a CRM helps when deals stall
- Every deal's status at a glance, including which are on hold and which closing dates have moved. (Pipeline tools.)
- Follow-up tasks and reminders, so a paused deal gets a regular call instead of being forgotten. (15 automations that save brokers time.)
- Backup buyers on file, so when a deal dies, you know who to call next. (How to spot and qualify buyers.)
- Drip campaigns that keep buyers and sellers warm while they wait. (Email marketing.)
- E-signature and data rooms, so documents can be shared and signed remotely.
What happened next
- Sales fell, then came back. BizBuySell reported 7,612 closed small business transactions in 2020, and 8,647 in 2021, a 14% rebound. Many of the deals on hold in March 2020 eventually closed, often on new terms.
- The SBA helped existing borrowers. Under Section 1112 of the CARES Act, the SBA made principal, interest and associated fee payments on eligible 7(a) and 504 loans for a six-month period, which helped many recently acquired businesses get through the worst months.
- Remote closings became normal. What seemed remarkable in March 2020, closing without anyone in the same room, became routine, along with e-signature and video calls.
- More owners are planning their exit. In Exit Planning Institute research, 91.55% of business owners said they plan to transition out of their business within 10 years. Brokers who stayed in touch through the crisis were well placed when those owners were ready.
- Deals still die in diligence. Even in normal times, Axial's Dead Deal Report found diligence findings were the most common reason deals died after a letter of intent in 2025 (25.3%). Crisis or not, the work of keeping a deal alive never stops.
Keep every deal moving with Vertica CRM
See how Vertica CRM tracks every deal on hold, reminds you to follow up and lets documents be shared and signed remotely. Contact us for a short demonstration.
Schedule a Demo Questions? Call +1 212 381 4994 (USA) or +61 3 8518 4759 (Australia).Frequently asked questions
Can you sell a business during a recession?
Yes. Deals slow down and terms often change, but businesses keep selling in recessions and crises. Sellers may be more motivated, and businesses that meet everyday needs tend to keep attracting buyers.
What happens to a business sale under contract when a crisis hits?
It usually goes on hold rather than ending. Unless the buyer formally withdraws or the contract lapses, the parties are still in contract, and the broker's job is to keep both sides talking and document any new dates in writing.
How do you keep a stalled business sale alive?
Stay in close contact with both sides and offer ways to bridge the gap: a lower price, more seller financing, a longer payout, an earnout, a delayed closing or a different transition or training period.
How can you tell if a deal is on hold or dead?
A deal is on hold while the contract is in force and both sides are still talking. It's dead when the buyer formally withdraws, the contract lapses, financing is withdrawn with no alternative or the seller takes the business off the market.
Should a seller cut the price in a crisis?
Sometimes, but it should be an informed decision. A broker should help the seller compare what the business has earned, what it's likely to earn after the crisis, and alternatives such as waiting or restructuring the terms.
Which businesses are recession-resistant?
Businesses that meet everyday needs, such as laundromats and dry cleaners, auto repair and food production, tend to keep some income even when revenue dips, which helps them keep selling.
Can a business sale close remotely?
Yes. With secure document sharing, identity checks, e-signature and agreed processes for transferring funds, keys and passwords, a business sale can close without anyone in the same room. Some documents may need notarization under local rules.
How did COVID-19 affect business sales?
Many deals went on hold in early 2020 and prices fell in hard-hit industries. BizBuySell reported 7,612 closed small business transactions in 2020 and 8,647 in 2021, a 14% rebound.
What did the SBA do for business borrowers during COVID-19?
Under Section 1112 of the CARES Act, the SBA made principal, interest and associated fee payments on eligible 7(a) and 504 loans for a six-month period.
What should a broker say to a nervous buyer?
Acknowledge the uncertainty, remind them the deal is on hold rather than dead, and offer to explore what would make it work, such as a different price, more seller financing, a longer payout or a later closing.
When should a broker let a stalled deal go?
When the buyer has formally withdrawn, financing is gone with no alternative, the seller has taken the business off the market, or the terms needed to save it would seriously harm either client.
Is there a checklist for rescuing a stalled business sale?
Yes. Vertica CRM offers a free one-page Deal Rescue Checklist (PDF) covering how to tell if a deal is on hold or dead, what to check first, options for each side, scripts, a remote closing checklist and when to walk away.