3. Company Presentation

The success or failure of a planned company sale depends to a large extent on the presentation of the marketable company. Marketability means that the presentation must meet market requirements and take into account certain formal and content-related aspects. Buyers expect to be informed about the subject of the sale factually, soberly, and in sufficient detail through the presentation, without the need for physical presence at the point of sale or complex information gathering through questions and answers. Buyers typically handle multiple offers simultaneously and cannot afford numerous meetings just to obtain missing but essential information for their decision. Only to ultimately find out, after the gradual presentation of all relevant facts, that the offer is not interesting. If there are any unresolved problems in the company, they must be disclosed. Over time, these problems will surface anyway, and initial concealment will reliably terminate the sale negotiations. A deal is only closed when a relationship of trust is established between the seller and the buyer. Trust is the result of transparency, speed, and keeping promises and the obligations arising from them.

Company presentations created by the sellers themselves are often characterized by lengthy product or service descriptions with high development potential. In addition, they usually include exaggerated details about their own assets and lucrative properties (if available), and with a bit of luck, the potential buyer learns the number of employees and perhaps the revenue, or with great luck, the financial result.

All of these are necessary but insufficient pieces of information from the perspective of marketing the company. Generally, the principle is to provide sober and factual (without subjective assessments) decision-relevant information for a potential investment. Practice has clearly demonstrated that the presentation must be clearly structured, pages numbered, and a table of contents created. Indispensable elements include formal information -- legal form, share capital, ownership structure, year of establishment, location, industry, purpose (reason) for sale, and company history. For economic assessment, the aspects considered include production scope or service range, technologies used, key competencies, strengths and weaknesses, corporate strategy, competitive situation, market characteristics, sales and marketing channels, number of customers and their percentage share of revenue, supplier information, employee structure with organizational chart, order structure and fulfillment, accounting and management accounting, balance sheet structure, and financial results. These are just some of the required pieces of information. Depending on the individual situation, additional information is required. For example, for technology companies, information about patents and protective rights is requested. In conclusion, the question should be answered -- Who would derive the greatest added value from acquiring the company? In other words, the characteristics of the ideal buyer.

After the initial information, buyers usually request financial statements -- Balance Sheets and Income Statements. However, the raw numbers from the statements say nothing about how they were achieved, or whether they are based on a sustainable and successful business model, and are therefore not very informative. The question is whether the statements contain one-time effects, how many customers generate the revenue, what the dependencies and market specifics are, what benefits the owner derives from the business, etc. Only the decoding and commentary on individual items of the Balance Sheet and Income Statement (legend) can provide a useful and informative information base. This also includes mentioning the difference between accounting profit according to the annual financial statements and profit transferable to the owner. For better clarity, it is advisable to look at at least the last consecutive periods and transfer them into a table or graph. Final financial statements for a period (usually at year-end) are typically submitted later (June of the following year).

At the end of the business presentation, the sale offer must be stated, consisting of the derived selling price and the method of company transfer. Sellers usually tend to omit this concluding part and often want to keep their options open, claiming they are open to everything. At first glance, this seems good, but in reality, it terminates the sale negotiations. The theoretical buyer expects the seller to understand the value of their company and assumes that the seller will make decisions based on the best conditions presented. A seller who is uncertain will get entangled in the buyer's proposals, and everything ends in endless discussions.