Selling assets and liabilities, and finding a buyer

A change of ownership involves several different phases. If you start the planning in time, you will be in control of the process. In this section, we consider the most important aspects of a change of ownership.

• Motive: review why and how much of the company you want to sell.
• Buyers: define the types of buyers you have in mind and how the purchase will be financed.
• Advisors: use qualified advisors who can make objective assessments.
• Structure: review your business's organisation and routine, so that it doesn't depend on you. A well-managed company will also be more attractive to buyers.
• Future: think about your role after the sale, check the tax implications and make sure you have funds to live on when you retire.

Find a buyer

Potential buyers for your business include partners, employees or other companies in the same sector. Be sure to review and document the activity before a sale.

The Partnership Agreement governs how you can sell the assets and liabilities. In the case of a transfer of assets and liabilities, the activity itself is sold; the company name and company number are not included in the purchase.

Employees

Selling the business to one or more employees has the advantage that they know the activity, which means that the transfer is unlikely to worry customers or other employees.

Other businesses

A transfer to another business often gives the seller a higher price than a succession of generations or sale to employees. Often this company is a customer, a supplier or a competitor.

Outside private persons

For many entrepreneurs, buying an existing business is an alternative to starting a business from scratch. There are also so-called "business angels" who can invest larger sums and are actively involved in running and developing the business.

Prepare your business for sale

To make your business attractive to buyers, you need to make sure it is in a saleable condition. Start by addressing the documentation of routines and processes. Here are some areas to review.

Order and organisation

• Are accounts, contracts and administrative documents in order?
• Are production, routines and processes well documented?
• Are the core business, customer base and contact network well documented?
• Should the business plan be updated?

Balance sheet and contracts

• Are there assets that should not be included in the activity in order to facilitate the purchase?
• Are there debts or unmade settlements to affiliated companies?
• Are there unresolved disputes that should be set in order?
• Is an important contractual date approaching (rent, lease, etc.) of significance to a potential buyer?

Performance sheet

• Should any loss-making or ancillary activities be closed down or removed?
• Are there special agreements, discounts, etc. to loyal contacts that a buyer may not wish to assume?
• Should any deals or development projects be completed before the sale takes place?

External factors

• What is the state of the economy as a whole and the industry?
• Is your business seasonal?