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how to optimally prepare for a company sale, step by step.

Preamble - selling a business

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1. Reflect on the decision to sell

Before concrete steps are taken, the decision should be well thought through.

Ask yourself:

• Why do I want to sell?
• What are my financial and personal goals?
• Am I prepared to relinquish responsibility?

A clear inner compass helps to steer the sales process with focus and determination.

2. company valuation: What is my company worth?

A realistic company value is the basis for every successful sale. 

This includes:

• Income capitalization approach: Valuation based on future profits.
• Net asset value method: Valuation of assets (equipment, property, etc.).
• Multiplier method: Comparison with similar companies on the market.

Tip: Consult a neutral valuer or M& A consultant to determine the value on a sound basis. It is highly recommended that you also commission the valuer to act as an agent. Otherwise, the values are usually significantly higher than the market value and a sale cannot be realized.

3. prepare documents and records

A potential buyer expects complete and transparent documentation. These include:

• Annual financial statements for the last 3-5 years
• Business management analyses (BWA)
• Contracts with customers, suppliers and employees
• Documentation of the company structure and processes

A professionally prepared information memorandum is the heart of the sales documents.

4. exploit optimization potential before the sale

A company sells better when it is ‘in shape’. This means:

• Reviewing and, if necessary, adjusting contracts
• Clarifying legal or tax risks
• Optimizing cost structures
• Securing customer relationships (e.g. through long-term contracts)

Investments in these points often pay off in the form of a higher sales price.

5. finding and selecting buyers

Depending on the target group, different buyers may be considered:

• Strategic investors (e.g. competitors)
• Financial investors (private equity, family offices)
• Internal successors (e.g. employees MBO or family members)
• MBI Management Buy In

It is important to approach potential buyers discreetly and in a targeted manner - typically via M&A advisors, tax consultants or specialized platforms. For over 25 years, this is our daily business. Of course, we have a large network of contacts.

6. due diligence: the company audit

As soon as a buyer is seriously interested, due diligence follows. Here, the buyer examines all relevant aspects of the company:

• Finances and taxes
• Legal issues
• Personnel, contracts and risks

Good preparation reduces queries and strengthens trust.

7. negotiations and purchase agreement

Concrete negotiations begin with one or more prospective buyers. This is not just about the price, but also about

• Payment terms (e.g. one-off payment vs. installments)
• Guarantees and liability provisions
• Transitional provisions (e.g. advice for the previous owner)

The purchase agreement should be reviewed by experienced lawyers.

8. handover and communication

A structured handover process is crucial for the future of the company. This includes:

• Internal communication to employees
• External communication to customers and partners
• Familiarization of the successor

Transparent and respectful communication creates trust and continuity.

Conclusion - selling a company

A successful company sale is not a product of chance, but the result of careful preparation, planning and professional support. Those who deal with the issue in good time have the best chance of handing over their life's work into good hands - and of ensuring the success of their business.

I look forward to our conversation about your approach.

Dipl. Wirtsch.-Ing. (FH) Rolf Popp

0049.931.70528570
management(at)pro-consult.com.

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