Company Profile
A company profile is the foundation for a successful business sale. Potential buyers of a company should be able to obtain comprehensive information about the business being sold. Prospective buyers want to gain a comprehensive and professional understanding of the company they are interested in. It must be thorough, truthful, detailed, and free of emotion. Since a prospective buyer usually has several companies in mind, the prospectus must provide enough information to allow them to assess whether the offer is of interest to them or not. It’s also essential that you highlight any weaknesses and be honest. Sooner or later, all the details will come to light during negotiations anyway. Therefore, you should be transparent and provide a detailed account in the company profile from the very beginning to build trust.
Preparing for the Sale with the Exposé
When a business profile is created for a company, it is done so that prospective buyers can be informed about the important details of the business before deciding to take over the company. By reviewing it, potential buyers gain a first impression and can form a picture of the business being sold. A business profile also helps assess whether the asking price is realistic. Anyone looking to buy a business wants to receive as much information as possible.
What makes a good exposé?
It should be clearly structured and contain all important information regarding the company. This allows a prospective buyer to make a more confident decision about whether or not to purchase the business. Prospective buyers should be able to see at a glance where to find specific information on various topics related to the company. It must present both the positive and negative aspects from a neutral perspective. You should definitely include the following information:
Information on formal details such as legal form, shareholders, history, industry, location, capital, and reason for the sale
Information on the economic situation: products, services, core competencies, technology incorporated, company strategy, strengths, weaknesses, competitors, market situation, marketing and sales strategy, customers and target audience, employee information, financial overview, order management, balance sheets, profits, and losses.
Depending on the type of company and its field of activity, additional information—such as details on current patents or intellectual property rights—may also be required.
In addition, it is necessary to identify the skills the successor must possess to successfully continue running the company.
Furthermore, an explanation of the key financial metrics is required, especially if they include significant outliers—whether upward or downward.
Last but not least, the exposé should always conclude with the asking price at which you intend to sell the business. This price must be realistic and, based on the factors mentioned above, plausible and understandable.
So, if you prepare a detailed exposé, a prospective buyer can ideally prepare for an initial meeting—or realize in advance that they’re not interested in the company and cancel the appointment, which saves both sides a lot of time and effort. However, if both parties are interested and a meeting takes place, the conversation can be conducted in much greater detail with the help of the prospectus, and you can successfully sell the company.