Glossary · Reading the business
Operational continuity
In short
This refers to a business's ability to keep running smoothly during and after a significant event, like a change of ownership. As a buyer, you need to ensure the business won't skip a beat after you take over.
What it means in a deal
For a 7(a) acquisition, your lender and the SBA want to see a clear plan for how the business will maintain its revenue and operations post-closing. This involves assessing key employees, client relationships, and critical systems during due diligence. You must demonstrate you can step into the owner's shoes or have a manager ready.
Related terms
Common questions about Operational continuity
- What are the specific requirements for business continuity if the seller is the sole proprietor?
- What information does the SBA 7(a) loan program require for business continuity after an acquisition?
- What if the franchisor requires specific operational changes that impact the business's profitability?
- Can an SBA 7(a) loan cover ongoing operational costs like rent or utilities?
- Is working capital from an SBA loan available immediately at closing for operational expenses and payroll?
- If I am buying a business where I was previously an employee, does my operational experience count?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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