Frequently Asked Questions about Selling a Business

FAQ for sale

Is the company salable?

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A company to be marketable must be viable

Interest in a company comes from your Know-how,business processes, market and customers, while the value of a company comes mainly from its profitability. Having the proper management processes, company culture and ease of operating with new owners, are factors that facilitate the sale of a company.

If your business does not have a competitive advantage, it offers the same services or products of many other competitors, if customers are tiny and sales do not increase, if financial problems get worse, IT WILL BE VERY HARD to sell your business.

Adding a valuable difference to your products or services, continuously increasing sales, creating effective business and management processes, owning a marketing plan, and gaining market awareness are decisive steps that must be taken in order to transform your business into a attractive and salable resource.

So, before selling the company, it is critical to execute and to prepare a plan for sale of the company. This plan is a job that begins with a diagnosis, for later compliance with the expectations of a standard buyer. This strategy facilitates the sale and appreciation of the company, taking care of the interests of all stakeholders.

The company will sell itself when someone with financial ability and interest understand that it is time to buy it.

 

How long does it take to sell a business?

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Selling a business is a time-consuming process that requires much follow-up and preparation!

 

The time that is needed depends on the economic situation and the type of company.

The disclosure made on the site and the contacts made by the broker are fundamental. How to get the right information to the right person is a procurementwhich requires knowledge, experience, feelingbusiness research, research and study of decision makers as well as perception of capacity and quality of funding.

The time for selling a business depends on many factors, including price, type of business and payment terms.

Typically, 6 and 18 are required months to find a buyer. The price and conditions are then decisive factors for the realization of the business.

 

How much is a company worth?

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Does the company have an added economic value?

By price of a company can be understood the value that a buyer is willing to pay, at a specific time, by a particular business or company.

It is the market that determines the price, the owner defends its value. For a particular buyer a company can be worth a lot; for another it may not be worth anything.

A buyer only acquires an interest in a company where it has prospects of obtaining yields superior to a financial application without risk.

When you invest, the buyer expects their investment to have a payback period between 5 and 10 years. Thus, an investment must have an annual yield rate target of 10% to 20%.

The Bolsa Portugal Negócios has expert appraisers who perform a complete job in the evaluation of companies. This work starts from a diagnostic and analysis study, and then materialized in a report that can be used for several purposes.

Business appraisal is a structural point for the success of a business sale plan.

 

How is the sale of a company disclosed?

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There are several strategies strategies to publicize the sale of the company!

Disclosure Process

The broker's function is to approach sellers and buyers.

All processes of sale / purchase of companies are disclosed on the website of Bolsa Portugal Negócios.

In the process mediated by Bolsa Portugal Negócios, a specific work is carried out. The broker makes a personalized offer, through a personal contact, on the sale of the company to a set of previously identified buyers (competitors, foreign companies, investor groups, venture capital companies, etc.)

The broker announces (in newspapers or specialized publications). Generally, this announcement is included in the "business opportunity" section or "business and industrial premises". The ads are designed to attract investors and within a confidential concept.

The business is often announced and the advertisement for sale or purchase can be placed in conjunction with other offers from Bolsa Portugal Negócios, achieving greater visibility.

The website of Bolsa Portugal Negócios is published by the "Internet search engines", attracting users. In the database, potential buyers, entrepreneurs and investors are surveyed.

Finally, the various associate brokers develop the exchange of information and disclosure to potential clients.

Price and payment of the company

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Negotiating the price and form of payment is crucial

After the interest of a buyer, negotiating the price and payment requires a lot of experience. At this stage the intervention of lawyers is common, but many do not have experience in selling companies and can compromise the business. O business broker seeks to promote the business; the lawyer only looks at the rights of one of the parties - his client. This difference of perspective sometimes leads to difficulties. Contracts must be drawn up by a lawyer (which may be indicated by the seller or Bolsa Portugal Negócios) but business broker. A well-drafted contract and the existence of executive bonds (or bank guarantee) provide reasonable security.

At the time of negotiation
Negotiation skills and knowledge are needed! Trading experience allows the seller to deal with a multitude of situations. Everything has to be prepared - values, forms, guarantees, previous checks. This is the only way to avoid surprises!

Practice shows that the announced selling prices suffer an average reduction of 15 to 20%, a trading margin that should never be disclosed, save for a manifest intention to buy in the negotiation stage of the company.

Not always the buyer pays the company in full! Negotiating payment in a step-by-step manner requires increased care. Paying installments involves a very high risk that must be properly assessed and insured.

 

Do I need to sign a contract?

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The written contract is an instrument of legality

Term contract for sale

When there is an interested party (with financial and management capacity), the broker and the seller celebrate the contract before sending the buyer.

As a rule, Bolsa Portugal Negócios does not enter into exclusive contracts and the client may sell the company by other means, own or by using other brokers.

What Does a Business Broker Do?

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what do one business broker?

In the Anglo-Saxon language it is called "business broker"a professional of mediation of sale of companies.In Portuguese-speaking countries, the business broker is called the qualified professional to provide mediation services for the purchase and sale of companies.This professional develops contacts, seeking to bring buyers and sellers closer together through of specific sales techniques. The broker must participate in all stages of the process, from the initial evaluation of the business to its conclusion, always seeking to achieve the objectives of the client.

The broker carries out a serious and confidential work, always aiming at the success of the business. Experience, ethics and knowledge are the core competencies in your work!

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What are the selling commissions?

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Two ways to sell the company!

We offer two types of sale of companies: sale mediated by the advertiser himself or sale mediated by Bolsa Portugal Negócios.

If the sale is mediated by the advertiser himself, he inserts the advertisement on the platform. The seller indicates his / her contact details and manages the interested countries that will contact you. This option is recommended for companies worth up to 500.000 €.

If the sale is mediated by Bolsa Portugal Negócios, there is a mediation commission and an optional procurement of buyers. In this case, the commission is only due in case of success and resulting from the work of raising or mediation carried out by us. If the sale of a company does not take place, the seller will only pay for the services he or she expressly requests (development of personalized contacts, internet advertising or publications, targeted marketing, search and investigation of buyers).

Sales values Commission   Custom services Prices of services
500.000 €   1.000.000 € 10%   Diagnosis and professional presentation Marketing for disclosure

4.000 €

a

10.000 €

1.000.000 €   2.500.000 € 7.5%   Preparation of sales strategy Making personalized contacts
2.500.000 €     5%   Selection and investigation of buyers Meetings, travels, negotiations

 

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