PREPARING THE COMPANY FOR SALE

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PREPARATION IS THE KEY

The price that can be obtained for the sale of a business can vary greatly depending on the preparation process.

Preparing the company properly before its sale can help it to its price is multiplied. Conversely, overlooking essential aspects can significantly reduce its value.

There is a long list of factors to take into account: from the structure of the company to human resources and financial aspects.

Here is our checklist of tasks for preparing a company for sale and achieving the maximum price. And yours, is it ready?

• All the aspects that you have under control and in order are a point in your favour when it comes to achieving the highest price for the sale of your company.
• If, on the other hand, you haven't thought about some of the critical values of preparedness, that's OK, it's time to get down to work.

The sale is a new process for the selling entrepreneur. It is common not to know all the factors of the transaction.

PRODUCTS AND SERVICES

Analyse:

Conduct an exhaustive analysis of your products and services. cost of production? what margins of benefits you get?

Diversify:

Do you have capacity of diversification in your production? Do you export your products and services?

YES. Why not consider opening yourself up to possible new markets?.

NO. Performs a analysis of the external marketstarting with neighbouring countries, in order to identify the most important opportunities marketing your products and services.

EXISTENCES:

1. UPDATED INVENTORY

• Is your inventory up to date every month and according to the market value?

2. STOCK STATUS

• Do you have obsolete stocks? If so, can you liquidate it?
• Have you regularised all stocks unaccounted for?

3. PURCHASE PLANNING

• Do you plan your purchases with a view to avoid stock-outs?

4. TECHNOLOGY

• Are you investing in software or technology for the management control?

CUSTOMERS

HOW MUCH DO YOU DEPEND ON THEM?

Make an analysis of your customers: make sure that none of them represents a significant weight on your total sales.

1. CONTRACTS

• If any of your clients have a significant weight; are the long-term guaranteed contracts?
• What is your relationship with this important client?

2. PROFIT MARGIN FOR THE CUSTOMER

• Perform an analysis of the profit margin you make for each customer, by deleting those who are not profitable.

3. SALES ALLOCATION

• If you charges in advance; Are sales being allocated correctly?

SUPPLIERS AND MACHINES

ARE YOU DEPENDENT ON A SUPPLIER?

Conduct an analysis of your suppliers: make sure that no supplier represents an obstacle to your business. significant share of total purchases. If so, do you have alternatives?

1. FORM OF PAYMENT

• When do you pay each supplier? Adopt strategies in this regard. For example, try to extending payment periods without putting too much pressure on them.

2. CONDITION OF THE MACHINE

• Perform an analysis of your machinery, in order to identify machinery that has been left behind. obsoleteIs there a maintenance adequate?

3. INVESTMENT

• Plan CAPEX investments for the next three years based on demand.

COMPANY

1. OWNERSHIP

• Do you have a corporate analysis of your company? holding company on which all companies hang or, on the contrary, are all companies in possession of natural persons?

2. TAX PLANNING

• If you want to sell, make a tax planning of the transaction between six months or a year earlier of the sale of the company.

3. ANTICIPATE SHAREHOLDER CONFLICTS

• Who are your shareholders? What do they want? Identifies potential conflicts between shareholders in the face of the sale and plans how to resolve them eventually.

4. MANAGEMENT TEAM

• Does the management team participate in the shareholding of the company? If not; could it be possible?
• Identify how to be more productive e innovativeIt analyses the recurring, non-recurring elements and steps in the value chain. It analyses the processes for delete those that do not add further value.

TEAM

ORGANISATION

• Draw up and analyse your company's organisation chart; is it clear and is it clear?Depends to a large extent the company of youIs there a management team?

2. WORKING METHOD

• It is essential to carry out a regulation of all labour aspects of the company: overtime, allowances, working hours...

3. PROCUREMENT MODELS

• Analyse the working conditions of freelancers and partners who could provide services to the company.
• It is essential to professionalise the company, establishing a structure that allows responsibilities to be shared and in which not everything depends on the owner.

PLANNING

1. STRATEGIC PLAN (+)

• Do you have a strategic plan? If so; is it being complied with?

2. BUSINESS PLAN (+)

• Do you have a business plan for a period of three to five years? Do you analyse its fulfilment?
• If you don't have one, draw up a business plan where you define the main objectives to be achieved in financial terms: sales, EBITDA, financial debt, CAPEX, and cash flow (+).

3. INFORMATION SHARING

• Do they know your heads of department Are they informed about the extent to which they are being implemented?

4. SECTOR

• Conduct an annual sector benchmarking analysis to identify your position within your sector in the market.

5. GROWTH

• Are you growing at the same pace as your sector?

6. PROFIT MARGINS

• Your margins; are they in line with those of your sector?

7. RANGE OF SERVICES

• If you offer services; are they sufficiently standardised to be considered as a efficient product?
• To have all the information of the company in a structured format will allow for an understanding of their situation and to make a better and faster decision-making.

FINANCE

1. SCORECARD

• Does your company have a scorecard?

2. KPIs "FINANCIAL INDICATORS" (+)

• Do you have your KPIs (or Financial Indicators) clearly identified? How often do you carry out your KPIs? analysis of the KPIs?

3. BUDGET

• Performs a annual budget of the company, together with the quarterly closings y monthlyDo you keep track of your accounts on a monthly basis? Calculate possible deviations from the budget and analyse the reasons for these deviations.

4. DEBT

• Define your financial debt, if any.

5. PROPERTIES

• Analyses all the real estate affected by the company's operations.

6. SURPLUS MANAGEMENT

• How does the company carry out the management of surplus cash?

7. TREASURY (+)

• Does the company avoid tensions Treasury?
• Identifying and dealing with potential tax or financial problems helps to have a more effective tax and financial more objective approach, a minimise and to reduce risk.