How to prepare your business for sale in Ireland

You might be considering retirement, a different role or simply whether the business could be sold one day. You do not need a firm departure date to begin preparing. You do need to look at the company as someone outside it would.

An owner knows why a difficult quarter happened, which customers are reliable and who keeps the operation moving. A buyer cannot rely on that familiarity. They need evidence that the business they are buying can keep earning after the ownership changes.

The starting point is a business whose performance you can explain and support. This guide sets out the main areas to review before you go to market.

Before asking what a buyer might pay, consider what you want to change. Do you want to leave entirely, reduce your financial exposure or stay involved with less responsibility? A full sale, a partial sale and a management buyout can lead to very different working lives.

Write down what matters to you, including your preferred timing, how long you would be willing to stay after completion and whether protecting the team is a priority. These are preferences to discuss, not promises a transaction can necessarily deliver.

You may decide that growing the business first is the better option. Clearer accounts, stronger management and less dependence on you can support continued ownership as well as a future sale.

Gather the annual accounts and current management accounts, then check whether they tell a consistent story. Can you explain the difference between turnover growth and profit growth? Can you show where the profit comes from across the year?

A buyer may ask about maintainable earnings, meaning the profit the business can reasonably sustain under normal conditions. One-off income or costs, owner remuneration and related-party arrangements may need explanation. Any proposed adjustment should be documented and discussed with your accountant, not treated as an automatic increase in value.

Separate what has already happened from what you hope will happen. Buyers give little weight to an unsigned contract or an expected efficiency saving. Forecasts can be useful, but the assumptions behind them need to be clear.

Good records do not guarantee a higher price. They give a buyer a better basis for judging the business. If your management reports are inconsistent, improving them is a sensible place to start.

Business valuation is a separate question from turnover. Profitability, risk, sector, customer relationships and the ability to continue trading without the owner all influence a buyer's assessment. A headline multiple without that context tells you very little.

It is also important to distinguish the agreed business value from the amount available to you. The treatment of cash, debt and working capital can affect the final equity price. Tax, professional fees and any deferred payments affect what you ultimately retain and when you receive it.

Discuss these distinctions with your advisers before setting a personal target. A headline figure with part dependent on future performance is worth less to you than the same figure paid on completion. Our article on what an Irish business is worth goes further into how buyers assess earnings and risk.

Look at how much revenue and profit come from your largest customers. Customer concentration means a significant share of trading depends on a small number of relationships. There is no single percentage that makes every business safe or unsafe. The nature and durability of those relationships matter too.

Check which agreements are written, when they expire and whether the customer relationship belongs to the company or largely to you personally. Do not assume a change of ownership leaves every contract untouched. Your solicitor should review any relevant assignment or change-of-control provisions.

The useful question is whether someone else could understand and manage those relationships. Clear records of responsibilities, pricing and service commitments help make the answer less dependent on the owner's memory.

Owner dependence shows up in the decisions, relationships and knowledge that stop moving when you are unavailable. Sales approvals, supplier negotiations, technical decisions and customer complaints can all concentrate around the owner.

List the responsibilities that currently come back to you. For each one, identify who could take it on, what authority they would need and what information is missing. A job title is not enough if the person still needs your approval for every meaningful decision.

Build this gradually through normal trading. Give people defined responsibilities, document recurring processes and review how the arrangement works. Do not present a newly written manual as proof that the business is already independent of you.

The aim is to make clear what a new owner would inherit and what support would be needed during a handover.

Due diligence is the buyer's investigation of the business and the claims made about it. Financial, legal, commercial and operational reviews may all form part of the process. The scope depends on the company and the proposed transaction.

Start by organising company records, accounts, tax records, key customer and supplier contracts, employment documentation, premises agreements and evidence of ownership of important assets or intellectual property. Sector-specific permissions or regulatory requirements may also need attention.

Keep a list of missing, outdated or unsigned documents and assign someone to resolve each item with the appropriate adviser. Discovering a gap early gives you time to address it before it becomes a live negotiation issue.

Keep sensitive information controlled. Sensitive customer, employee and commercial information should be disclosed through a controlled process agreed with your advisers.

A profitable business still needs money to fund day-to-day trading. Working capital usually involves items such as stock, customer debts and supplier balances. In a sale, the parties may agree a normal level of working capital to be delivered at completion.

That makes overdue customer balances, slow-moving stock and the timing of supplier payments relevant. A year-end snapshot may not describe how the business operates through the rest of the year, particularly if it is seasonal.

Ask your accountant to help explain the pattern and any proposed completion adjustments. Avoid assuming you can remove all the cash immediately before a sale without affecting the deal. What is included and how it is measured depend on the agreed terms.

Selling a business brings together commercial, accounting, legal and tax questions. An adviser who understands the sale process can help you consider your options. Your accountant, solicitor and tax adviser have distinct roles, and the support needed will depend on the business and the transaction.

Ask who will do the work, what it covers, how fees are calculated and what happens if you decide not to proceed. Be clear about the difference between preparation advice, finding a buyer and managing a transaction.

Building systems and keeping documentation up to date as the business grows can reduce the work needed when a sale becomes a real possibility. Early advice can help you understand which areas deserve attention while there is still time to address them.

The purpose of early advice is to understand the choices and the work involved before you commit. It should not require you to pretend that you have already decided to sell.

Begin with one focused review meeting. Bring together the latest accounts, management reports and an outline of the main customer relationships. Note the questions you cannot yet answer and the records you cannot readily find.

Then choose a manageable set of priorities. One might be explaining the profit clearly. Another might be transferring a recurring decision to a manager. A third might be getting a key agreement reviewed. Give each one an owner and a review date.

Our owner readiness checklist can help you identify areas to examine. Use it as a starting point alongside professional valuation, legal and tax advice.

If you are privately weighing a sale, understanding what buyers look at is a useful next step. That is why we developed Selling Up, a two-hour executive session on the factors buyers assess, the risks they may discount and the preparation worth considering before going to market. You do not have to have made the decision to sell to take part.