Basic knowledge of how to buy a business



Basic knowledge of how to sell a business



Various articles about entrepreneurship in Greece

Επιλέξτε κατηγορία άρθρου

“There are three obvious shortcomings of the DCF approach.  One, it ignores key information — namely the value of the assets in the business.  Two, it takes very good information which is the near term cash flow projections, and very uncertain information, the terminal value which is supposed to capture the value of cash flow beyond four years, and adds them together.  Naturally, the bad information dominates the valuation.  Three, it does not account explicitly for industry competition which is a critical — if not THE critical — factor, affecting valuation.”

Prof. Bruce Greenwald

Columbia University

New York, USA



Two months ago, we were commissioned to research two seemingly different cases.

The first was to investigate and conduct a valuation of a profitable company that our client wants to buy. The second was to find the value of another profitable company whose owner (our client) wants to sell. They both asked for a comprehensive and fully substantiated valuation that they could present to their counterparts.


The DCF Method

A look at 7 presentations of valuations conducted by banks or consulting companies, revealed that they were all very similar as to their methodology. They were based on a projection of the future five year performance of the companies involved. It was a prediction of both the annual cash flow the company will generate and a projection of the terminal value of the company at the end of the five years that the investor will own.

This is the most popular method used for the valuation of companies, at least in Greece. It is the DCF (Discounted Cash Flow) method. Most negotiations are based on this methodology.

There are quite a few problems with DCF as Prof. Bruce Greenwald commented above for this article, the most worrying of which is that it is based on future assumptions about the performance of a company. It makes five (if not more) year predictions on the company’s sales, gross margin, growth rates, operating profit margins, tax rates and its terminal value. As we all know, these are very hard to predict.

Can anyone predict with any degree of reliability the annual cash flows to the investor an investment in Apple would produce? Can anyone predict what the price of Apple will be five years hence? Or is DCF a method used for its seeming precision and ease of calculation?


The Value Investing Method 

Another philosophy on Valuations is more comprehensive. It is based on Bruce Greenwald’s and Judd Kahn’s book1 and it is the methodology used by Value Investors, the best known of whom is Warren Buffett.

Greenwald’s and Kahn’s methodology, which we follow, takes a deep dive into the company’s last ten year performance. It examines both the Balance Sheets and Income Statements, adjusts them as appropriate and comes up with two valuations.

One is the Reproductions Cost of the company’s assets today (derived from the Balance Sheets), based on updated tangible and intangible assets like receivables, inventories, buildings, machinery, goodwill, etc. The other is the Earnings Power Value, which is based on the adjusted Income Statements of the last 10 years.

It then combines the two and arrives at some well substantiated conclusions about the realistic value of the company as well as the competitive environment in which it operates.

Finally, it looks carefully into the company’s current competition, its possible future competition (if we could imagine it) and considers the sustainability or not of any competitive advantage the company enjoys.


The Corporate Dilemma

We have long struggled with our personal dilemma of whether to follow what our competitors do (which might bring us more customers as it is better understood) or use a methodology in which we have more confidence. I trust we have resolved it even at a cost. We choose the hard and time-consuming methodology. We owe it to our customers who entrusted us whether they want to sell or buy.


We are open for any questions, comments, discussion if you so wish.


EBITS Consulting

Company Valuations: Fast- Effective- Economical



Bruce C. Greenwald, Judd Kahn- Value Investing, Second Edition, WILEY 2021

A few days ago, a business owner who was interested in selling his business got in touch with Business Interval. After the required briefing on the history of his business, the topic of financial statements came up, and that’s when we received an astounding response: “I want to see the face of the buyer first, and if I like them, we’ll proceed; otherwise… let’s continue with the next one”.


An emotional attachment to your business is completely understandable. The overwhelming majority of business owners feel this way because they see their businesses as their children. When the time comes to pass them on to someone else, it feels like a father waiting to meet the person his daughter is dating. All of these emotions are understandable and humane, but let’s take a step back.


First and foremost, businesses are not our children; they are living entities comprised of hard work, dreams, endless efforts and sacrifices. However, they are neither people nor buildings. A business is a system. It’s a system made up of various elements and subsystems working together harmonically to achieve the goals set by the management. The organization, the management, the supervision, and the improvement of these components are what make one business successful while another one struggles or eventually closes. So, dear entrepreneur, while you may have spent years of your life building a business but now wish to move on for various reasons, you should be aware that it’s not a simple process. It could eventually take years. So, arm yourself with patience.


However, patience by itself won’t help you. You’ll need to prepare everything appropriately. In Greece, there is a shortage of professionals who can guide businesses through each step of the process. (Business Interval is one of the few companies in Greece with such expertise).


Firstly, ensure that your business remains operational, profitable and be discreet about the sale. It’s important to know that in the business acquisition process, the buyer has the upper hand. Often, the asking price is inflated and far from reality. Perhaps our tendency to attach emotional value to the things we’re involved in, leads us to overvalue them. Fortunately, there are scientific techniques to conduct a more realistic valuation. The fact that you’ve put in all this work doesn’t mean the buyer is obligated to compensate you for that. The thing the buyer is looking and willing to pay for is the entity’s potential to multiply his investment as quickly as possible.


Selling a business successfully depends on many factors, and it is shaped by the conditions and choices made by those involved in the process. Actions such as improving the business model, thoroughly presenting the economic results, and collaborating with professionals who can help prepare your business for the sale process, have a significant impact and greatly increase the chances of selling a small to medium-sized business.


To conclude, it’s worth mentioning that many times during the preparation for the sale, owners have the opportunity to reevaluate and carefully analyze their businesses and their respectful position in the market. This often leads to the discovery of problems and opportunities they hadn’t previously noticed. Addressing these issues and seizing new opportunities can result in improvements and ultimately a better valuation of the business.


There’s much more to discuss, and I promise to share more through this platform. I intend to explain things as simply and comprehensibly as possible while helping you increase the chances of selling your business as quickly as possible and at the best possible price.


Business Interval is here for you, ready to offer its valuable experience and expertise so that you can successfully sell your business.

So, the moment has come to evaluate your business as a whole and figure out if it is worth selling. With the right moves, could it become something great in the future? Or, would liquidation be a safer solution?

You will have to look at the value of your business beyond its material components, because as time has passed you have added tangible and intangible value. The reputation of your business and its customer base have both contributed to the creation of something greater than the sum of its parts.

Below you will find six steps which will help you determine if your business is worth selling:


  • Check the financial documents of the business


In order to make sure that your business is in good financial condition, you will need to check your finances, including your sales and profits over the years. As long as your gains exceed your debts, you are on the right path. A simple way to see is by subtracting your purchases, expenses (including the businessman’s salary) and income tax from your total income. Then, we can compare that number with the total amount of sales and the total capital invested.


  • Determine how your business is different from its competitors


Look at the products and/or services that your business provides. Buyers are attracted to a business that provides something unique and different from its competitors. You can accomplish this by offering products and/or services that stand out to consumers.

Other aspects of your business that make it different from competitors are its commercial viability, its brand and its reputation. How well known and respected a business is within its particular market is an important part of its total worth; your commercial brand needs to be recognisable. You should also have a strong internet presence on social media platforms as well as an effective marketing program. Based on ISO 10668, in order to make a correct evaluation of a brand, you have to examine it from three different perspectives: legal, behavioral and financial.


  • Examine your location and facilities


If we assume that your business is located in a real-world location and its goods and services are not available exclusively through the internet, this, too, can affect the prospective sales of your business. When the time comes to sell your business, it is a good thing if its physical presence is in a well-frequented area or somewhere geographically central with a constant stream of customers.

Additionally, the overall image you present to potential buyers will have to be good, including physical facilities and equipment at the location where your business is based. These all need to be up to date and to function without any problems. Usually, buyers feel more secure knowing that whatever lease involved is long-term and transferrable.


  • Determine the worth of your staff and customer base 


If you are thinking of selling your business, some basic information you will need to take into account is both your staff and customer base. A trustworthy and experienced staff with contracts easily transferrable to a new owner as well as clear staffing policies outlined in an employment policy handbook make a business even more attractive in the eyes of the buyers. Trustworthy staff and management can significantly contribute to a smooth transition to a new owner.

A large customer base as well as the existence of important customers with long-term contracts are serious advantages for any business. Keeping a steady customer database that can easily be transferred to a new owner will contribute to a smooth transition and immediately sets your business apart from others, most of which are unable to manage this.


  • Recognize the areas in which your business could be improved


Once you evaluate the condition of your business, determine in what areas you might be able to make improvements so that your business will be more profitable. Create a list of particular improvements for each possible weakness in your business. Then, figure out how much time it will take to implement your plan so that you have a timeline by which you can make all the necessary changes.


  • Decide if you should sell now, later, or liquidate


Now that you have determined the value of your business, sales potential and you have created a plan of action with a timeline for improving its sales prospects, you have in your possession all of the necessary information that you need in order to make an informed decision about how to proceed.


Depending on the current state of your business and your willingness to devote time and effort to improving it, you have the following options to consider:

  • The ideal scenario is to discover that your business is in good condition and ready to sell and so you can put down an asking price with certainty on account of its profitability.
  • You may discover that your business needs improvement in order to get a competitive price when it goes on the market. For various reasons, however, you may be determined to sell it in its current state. The decision is yours alone to make, but take into account that your sale price will likely be lower than if you had completed the needed improvements.
  • Otherwise, you can follow the plan of action that you created above knowing that you may delay the sale of your business, but in exchange you will have more interested buyers and possibly a higher sale price.
  • Finally, you can decide that the state of your business makes it uncompetitive in the market and it is not worth trying to improve it. In this case, you should choose to simply liquidate the estate.

Selling a business is a demanding process that requires a professional approach, especially given the amount of information and choices that will need to be made. The contribution of a professional regarding the finances of your business will be able to carefully direct you in the right direction. Business Interval is here to help, ready to offer you our invaluable experience, so that you can achieve the best results.

Buying an existing business with a recognizable brand is like running a marathon which has already been half-run for you by another athlete!

When we reexamine and recall from our memory the majority of companies that we have worked with, we can easily conclude that often the purchase of an existing business is a wiser option compared to creating a new one. Below, we list several of the advantages that existing businesses bring:

  • Existing cash flows
  • Reputation and customer base
  • Market share
  • Proven business model
  • Existing spaces and infrastructure
  • Suppliers and trained staff
  • Saved time
  • Technical knowledge and experience
  • Saved resources


Existing Cash flows


As is well-known, in business, cash is treasure. For the owner of a small business, it can be the difference between profit and bankruptcy! Just imagine starting the job of your dreams only to find out that you will need two to four years before it becomes profitable.

During this time, how will you pay your bills or invest in your business so that it grows? This is how many new businesses fail. They begin with passion but get frustrated by financial realities.

When you purchase an existing business, there are already (sales) cash flows. Generally, with an existing income, you will have one less factor causing you stress and preventing you from establishing your business successfully.


– Reputation and customer base


A business that has been operating for years has already created a community of people who know, recognize and trust it. We tell all of our customers that in the current time when there is such a battle for any bit of publicity and recognition, purchasing an existing business with a recognizable brand is like running a marathon which has already been half-run for you by another athlete!


– Market share


If you decide to purchase a business which has already been on the market for years, there is a real possibility that it has strong sales and possesses a significant share of the market. If the owner and employees are being paid properly while also maintaining the natural operation of the business, this means that we are dealing with a healthy business that has a constant stream of customers and sales.

If you decide to start a new business, you will have to consistently invest time, money and effort into marketing strategies. While you wait for your business to become known and begin to build a customer base, your bills will still need to be paid. All businesses require some amount of startup capital in order to operate but this is especially so with recently established ones.


– Proven business model


A business that has been operating on the market for years has essentially already a proven business model. When you have a recently established business, you are betting on the idea that customers need the product you are selling but without really knowing the true demand of the market for it. On the other hand, an existing, well-established business has proven that customers are buying and will continue to buy its products. This is why the business has been successful. 

As business owners, the fewer reasons for anxiety you have, the better your situation will be. In attempting to start a new business, you will have to shoulder the burden of making sales and maintaining sufficient cash flow while also training your employees so that they can meet the demands of their employment as well as to constantly be on the lookout for trustworthy suppliers. All these things can lead to complete exhaustion and potential failure, which no one wants when they are attempting to make something of their own. You can avoid all of this stress if you simply consider purchasing an existing business instead of trying to create something from nothing.


– Existing facilities and infrastructure


Compared to newcomers to the market, one of the most attractive features of an existing business is that it already has facilities and infrastructure in place. Whether we are talking about a flourishing business district or a well-known mall, location can be a fundamental component to success.

Moreover, an existing business has at its disposal all of the necessary things for its full operation, such as equipment, furniture, and components that are necessary to provide its products and services. Additionally, the majority of existing businesses already have some kind of online presence, either with a website or pages on social media platforms.


– Suppliers and staff training


Trained employees and salespersons are some of the most important factors for the success of a business. They are the public representatives of your company on a daily basis. People and other businesses which are already familiar with the market and your business can also be of significant help, saving you both time and money.

Usually, trained employees are already well acquainted with the processes and systems that will help your business run smoothly. The shorter the amount of time that you need to spent in training your employees and salespeople, the more time you can invest in improving other areas of your business.

Existing suppliers will know the products that your business needs and will be in a position to cover its needs without interruption.


– Saved time


Setting up a new business requires time: from renovation and picking out equipment to acquiring operating licenses and creating a website or e-shop. All of this time has a high price. So, if an appropriate existing business can be found on the market, you can save time and energy in a way that it is vitally important.


Technical knowledge and experience


There are businesses where the technical knowledge and experience gained from years of operation as well as lessons learned from mistakes made are of inestimable value for the business world. Just imagine needing to spend 5 to 10 years in order to obtain the corresponding experience while this could be obtained all at once by purchasing an existing business.


Saved resources


The creation of a new business requires capital investment to cover operating expenses such as materials, equipment, and that is without even mentioning advertising and the employees’ wages that will need to be paid. A new business will also not have a solid customer base. You will have to spend time and capital promoting your business in order to convince customers to buy the products or services they need from you rather than from a competitor.

In conclusion, purchasing an existing business saves time and resources and drastically increases the chances of your business being viable in the long term.


If you want to learn more about buying an existing business, you can read the other articles that we have ready for you here, while, for buying and selling businesses, you can visit our website Business Interval where you can find your next big commercial venture.

If you are seriously thinking about selling your business, you will need to be suitably prepared to answer questions from potential buyers. Every business exchange is unique, but there are certain basic questions that are useful in every case. Your readiness for these questions will help you obtain a clearer idea of the market and, in all likelihood, come to an agreement more quickly.


  • Why are you choosing to sell the business?


Selling a business because of retirement, relocation or the death of a family member is a common phenomenon and widely accepted. But, there are also businesses operating at a loss or have some kind of problem on the market. The best thing to do in such cases is to be up front and as clear as possible when presenting the specifics of the situation. Start by emphasizing your business’s strengths and do not forget to mention whatever you believe makes it unique. As soon as the reason that you would like to sell the business is cleared up, the buyer will have all the information, which they will need, at their disposal to decide if it is worthy of investment.


  • Does the business suit me?


This is something that the buyer will decide on their own, but as a seller you can help them reach a decision. You need to have a clear picture of who would be the ideal buyer for your business. They should be someone with the knowledge and capability to operate your business successfully and not someone who simply has the financial means to make the purchase. If they are interested and seem to be suitable for your business, it would be advisable to tell them during your first communication, because no one knows the job better than you do.


  • Is the business profitable?


One of the first questions a potential buyer will ask will have to do with the profitability of the business. They will want you to show them your financial statements, including your income and cash flows. They will want to see a healthy business with steadily rising income each year. Being able to prove the reliability of the business will make a positive impression and could even be the most important factor leading to a successful sale. Even if the financial statements do not reflect this ideal picture (i.e., of a profitable business) you will have to prove whatever you say with convincing and realistic evidence.


  • What is its position on the market?


Is the business uniquely positioned on the market? Does it have the competitive advantage? Buyers will be impressed if your business offers products or services that set it apart from competitors.


  •  Have you determined your business’s market value correctly?


Buyers who know what they are doing will ask you for detailed documentation proving the finances that you present. Can you back up the numbers? In order to make sure that purchasing the business is a good investment, you will need to be sure that the income and profits can be supported in practice. Working closely together with your accountant is absolutely necessary at this stage.


  • Is the business staffed with experienced employees?


A business staffed with skilled and experienced employees can make the difference for a potential buyer. Moreover, when a business has reliable employees, it likewise inspires reliability, trustworthiness, and a relative sense of continuity in its activities.


  • Does the business have an established customer base?


An established customer base that will stay with the business after it is sold is invaluable for potential buyers. It also proves that the business has laid a strong foundation in the market through its loyal group of customers.


  • Can the business be financed?


Acquiring the necessary financing for the purchase of an existing business can be challenging. This leaves the seller with two options:

  • Lower the price of the business
  • Work together with the buyer to get past these kinds of financial challenges

Using financing is becoming more and more popular, since sellers realize that not only does it increase the interest of buyers dramatically, but it allows them to get a better price.


  • What will happen with the rent?


If the business depends on its location, rent may be another crucial factor. Most likely, the lease can be transferred to the new owner. But, before putting your business out on the market, check the terms of the lease and see if it is able to be transferred from seller to buyer. There may be terms, such as guarantees and increased deposits that the seller and buyer both need to pay. If the lease cannot be transferred to the buyer, contact the owner and ask what is necessary for the buyer to do in order to be approved for a new rental agreement.


  • Are there things that I should know which do not appear in the papers?


In the majority of businesses, there are things that only the owners know and are not written down anywhere. It is very important as a seller to be honest with the buyer from the beginning because such information is usually revealed during due diligence. In brief, such things may include legal obligations, financial problems, labor relations issues, a history of bad customer service or other factors that affect the sale of the business. If you try to hide or purposefully put off until later talking about these things, they will come to light at some point, and you will in all likelihood lose your credibility before potential buyers. 

These are just a few of the basic questions that we deal with when it comes to buying and selling businesses. Beyond these things, there are a number of particularities and peculiarities that give rise to further questions depending on the case. Appropriate preparation and presentation of the company to be sold is a process that requires a professional approach and treatment. Business Interval has the experience and technical knowledge to support you in just such a venture.

The true value of a small business is found beyond its finances

When trying to determine the value of small businesses, one of the most commonly asked questions that buyers have is:

  • If I purchase this business, how much money can I make?

However, it is equally important to look beyond financial data when you are determining the worth of small businesses. Often, these financial data can be inaccurate or inadequate because they exist mainly in order to minimize taxes and not to measure how financially successful the business is.

Beyond financial data, there are some basic factors that affect value and must be taken into account when you buy a small business:


  • The business has provided stable income for several years


A business in operation for at least 3-5 years is worth being recognized for its success, however great or small it may be. This means that the income has been enough that the owner can make some kind of life and, at the same time, can cover professional expenses, rent, sellers and employee payroll.

This means also that gross sales provided enough cash flow to maintain smooth business operations. Sales affect value to a great degree. This is due to the fact that the real bottom line of profit (Seller’s Discretionary Earnings or SDE) is drawn from the first line of profit (gross sales).

For a small business that has been in operation for at least three years and is earning less than a million euros in gross sales, a general rule is that the profit of the owner (SDE) should be somewhere between 10 and 20 percent of gross sales. As soon as a business starts making more than a million in gross sales, the profit of the owner (SDE) should be reduced to 10 percent or less.


  • Does the business have room for growth and expansion?


A business is more valuable if it has the ability to grow after being sold. When evaluating a business, 30% of your attention should be focused on what the owner has already done and the other 70% should be concentrated on what you could do yourself with the business after purchasing it.

For example, if an entire business is based on the current owner because it depends to a large degree on one person, then it would be very difficult to expand.  In order to expand this business, it may be necessary to do a lot of work in the beginning in order to create processes and systems that will ensure the smooth operation of the business in your absence.

Other important factors include:

  • A strong commercial brand – A business with a good reputation on the market is more valuable than one which has been deeply affected by a crisis or by delivering bad services. A strong commercial brand within an industry will be much easier to expand.
  • Place on the market – A business which is better situated than its competitors has more of a chance of gaining a better place on the market. Those companies offer products and services that stand out on the market.
  • Quality of employees – A strong business has trustworthy and skilled employees. Those who remain with the company long term are likely to affect the quality and success of the business.
  • Continuous business operation – A business that operates year-round can offer a steadier stream of sales compared to similar seasonal businesses.
  • Strong and loyal customer base – A reliable customer base is equally important since it is quite likely to remain even after the sale of the business.


  • Running the business matches your lifestyle


Buying a business is just as much an emotional as it is a financial decision. If you do not like the industry in which the business is involved, or it does not match your lifestyle, then it will never be a suitable business for you, regardless of how successful it is.

Questions to ask yourself include:

  • Do I have the necessary skills to run this business successfully?
  • Is its location convenient for me?
  • How often will I need to be physically present at the business?
  • How often will I need to travel in order to meet with buyers and suppliers?
  • Do I prefer a wholesale or retail business?
  • Is it the size I want? (e.g., managing a large number of employees)


Dedicate some time to understanding the factors that affect the value of small businesses


Buying a small business will change your life in unexpected ways, both in terms of your income as well as your daily life. For this reason, you need to be certain about what you are looking for before you make a purchase. As soon as you evaluate the basic factors and choose a potential business, you will inevitably need to visit it for further investigation. The next business you will visit might just be the right one for you.

If you have any questions, or need help and guidance, you can contact our skilled staff at Business Interval.

There are a number of businesses that will be able to really benefit from making public their sale or acquisition. But for most this is not true. Limiting those who know about the sale to a small circle (especially at first) is a necessary condition which many business owners ignore, and unfortunately with dire consequences.

Confidentiality is exceptionally important in the process of selling businesses. It is important for achieving your own goals as well as the successful and smooth operation of the business after it is sold. Leaked information to creditors, customers, competitors or employees can bring negative consequences to its daily activities, weakening its commercial strength and therefore its value.  Furthermore, potential buyers may hesitate before purchasing your business if they feel that sensitive information has been leaked to third parties, considering the consequences that such a situation might bring.

If you sell your business, then there are certain steps that Business Interval, with its skilled associates, can help guide you in following so that exposure to unwanted publicity is minimized during the sale of your business:


  • Preparing an agreement which prohibits revealing information


A specific agreement needs to be put together in case a serious buyer wants to learn more information about your business. A specialized lawyer should write it, and it should be signed before revealing any information.

Not providing details or information in advance helps discourage others from identifying your business, unless we are dealing with a buyer with whom we will make an agreement. Equally so, it is important to include in your agreement a clause that ensures confidentiality on both sides, not only during the initial discussion period but also afterward, for a reasonable amount of time, even in case negotiations are unable to move forward.


  • Promoting your business using a “blind” advertisement


We should not share our personal contact information or company name when we advertise the sale of our business. We can reveal this information once a confidentiality agreement is signed. A “blind” advertisement with a title that highlights the strong points of the business will draw more interest from buyers than its name. Business Interval specializes in this promotional model through our webpage and only in cases where the seller wants identifying information to be available for their own reasons do we provide it.


  • Before deciding to give further information to a buyer, we need to think about whether they fulfil the necessary conditions


When we are selective to whom we reveal information about our business, we ensure a higher level of confidentiality, and we protect our own interests. Asking a potential buyer about their financial background and experience in the business world is of vital importance so that we can be certain that the potential buyer can put forward a realistic offer. Besides, buyers with experience in the market expect these kinds of questions. This is the kind of thing that proves that we are dealing with serious buyers, who are ready to respond to questions such as these and who will be able to take the next step in the process. In fact, most of them understand that, as a seller, you are being careful and know that if they proceed with the purchase, the manner of operation and finances of the business are all information that should be revealed only to the two parties involved.

At Business Interval we possess the specialized training and are able to filter out potential buyers for you so that we know who fulfils the necessary criteria and thus save you valuable time.


  • Preparing a bill of sale


Once we have signed a confidentiality agreement (see #1), we know that we are communicating with a serious buyer. Then we can move on to writing the bill of sale. This is a document that you will prepare with our guidance, wherever necessary. Essentially, the bill of sale gives a detailed picture of the business and will mention the reason why this sale is a good future investment. In the footnotes of each page, we state that access to the particular document is exclusively for the individual to whom it was given, that this document is protected by the terms of the confidentiality agreement which was signed, as well as that there will be legal repercussions in case this agreement is violated.


  • Signed document with statement of intentions


Revealing information about a business ought to be done in stages. Even if we have signed a confidentiality agreement, we should not reveal information regarding ownership, customer lists, commercial techniques, technologies in use, payment of employees and other sensitive information about our business. Before the process can move forward, the buyer must demonstrate their purchasing ability and intention to submit a realistic offer. This is achieved through the existence of a signed document in which the buyer’s intentions are stated.


  • Never meet at the location of your business


After the process has progressed and we have decided to meet with the buyer, all further activities and meetings take place in a neutral place away from the business, e.g., at the offices of Business Interval.


  • We limit the number of persons involved


We may need the help of several senior staff members of the business in order to assist us in gathering all of the necessary information, or a buyer may wish to meet the team behind the business. However, it is better if we limit the number of persons involved. We can explain to the buyer the importance of confidentiality at this stage of negotiations.

As we follow these steps, we should remember that providing information about your business should occur within a framework of confidentiality and in stages. We start by publishing a short description of the business in order to promote it. Then, we set the conditions for potential buyers and take all the necessary precautions to ensure confidentiality so that we only reveal further information to serious offers. Attempting to maintain the balance between answering the questions of potential buyers and the need for confidentiality can be difficult, but the appropriate preparation will ensure that the sale goes through smoothly. Besides, we should do everything possible to prevent the many negative consequences that a confidential information leak about the sale of your business can cause.

Business Interval makes use of the tools and techniques proven to yield the best results for all parties involved. The buying and selling of businesses is a very serious process with many dimensions and peculiarities that demand specialized knowledge and experience. You should select the right partners rather than attempting to do everything by yourself since the possibility that you will have good results will be up to luck.

In Greece, businesses are divided up based on three criteria (Total assets – Turnover – Number of Employees) into:

  • Large entities
  • Medium entities
  • Small entities
  • Very small entities


When we are trying to buy a very small or small business, we cannot use the rules and criteria that we would use for a medium or large entity. If we compare very small and small businesses with medium and large ones, we will observe that there are fundamental differences in describing and analysing their financial statements and outcomes, as well as in their way of operating and performance. Before we start looking for a very small or small business to purchase, we first need to understand the differences between the different sizes of businesses. 

To begin with, based on article 2 of Law 4308/2014, businesses are categorized based on their size as follows:

  • Large entities: (those which exceed the limits οf at least two of the following three criteria)
  • Total assets: 20,000,000 euros.
  • Net turnover: 40,000,000 euros.
  • Average number of employees during the same time period: 250 individuals.
  • Medium entities: (those which do not exceed the limits of at least two of the following three criteria)
  • Total assets: 20,000,000 euros.
  • Net turnover: 40,000,000 euros.
  • Average number of employees during the same time period: 250 individuals.
  • Small entities: (those which do not exceed the limits of at least two of the following three criteria)
  • Total assets: 4,000,000 euros.
  • Net turnover: 8,000,000 euros.
  • Average number of employees during the same time period: 50 individuals.
  • Very small entities: (those which do not exceed the limits of at least two of the following three criteria)
  • Total assets: 350,000 euros.
  • Net turnover: 700,000 euros.
  • Average number of employees during the same time period: 10 individuals.

  • They operate and make profits in different ways


Medium and large businesses, those with gross earnings that fluctuate within the many millions of euros, are mainly companies that are seeking to enter the stock market. In this way, they earn money not only by selling goods and services but also by selling shares for a specific price. Furthermore, their financial statements are formally audited chartered accountants and are published on a quarterly and yearly basis. The owners (shareholders) regularly receive outcome reports but they do not participate directly in the company. They are administered by a group of executives who are accountable to the board of directors.

On the other hand, very small and small private businesses make their money mainly through selling their goods and services. These businesses are not obligated to audit their finances or report their profits, but the owner can opt for regular auditing of their finances in order to help them manage the business. In most cases, the owner has some level of participation in the business. In very small businesses, the owner takes on not only the role of manager but also all of the others as necessary so that the business can operate properly. The owner of a small business is not accountable to anyone other than themselves.


  • Their finances have different goals


Medium and large businesses, which are public and belong to shareholders, want to show their profits, growth rate and wealth. They want to show how well they are doing so that they can sell shares at the highest possible prices. Their quarterly and yearly reports may even present to shareholders their profits before taxes so that the results can seem more attractive to them, even though the net amount can differ significantly. In terms of profit potential, the financial performance of large businesses is usually measured by EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization).

In the world of small businesses, the exact opposite happens: businesses attempt to show the lowest possible profits, mainly in order to reduce taxes. However, they do reveal a lot of information about the financial performance of the company and profit potential – you just have to know how to examine them. When we look at small businesses, the profit of the seller is measured in SDE or Seller’s Discretionary Earnings, which represents the amount that remains for the seller as income. In other words, the value of the sales and gross sales contribute to determining the value of a small business.


  • The size of the business can affect its potential earnings


Even though gross sales can be an accurate means of determining the value of a business, high gross sales do not necessarily mean higher value.

As soon as a business is earning more than one million euros in gross sales, their potential profits can be reduced significantly. This is due to the fact that they cost more to keep in operation. They have more staff members, employees, supplies and, often enough, smaller profit margins.

If you are looking for a very small or small business that is earning less than one million in gross sales, a good rule for determining SDE is to take into account 20 percent of gross sales. However, if you are looking for a larger business that is earning above one million in gross sales, the SDE is reduced to about 10 percent or less of gross sales.


Smart buyers of businesses will pose targeted questions and do their research before beginning their search. When buying a business, some of the most fundamental questions to which you will need to get solid answers are:

  • How many years will it take me to pay off my investment?
  • How much will business performance be affected by the change in management?
  • How much money am I able to make?

Understanding the true value of a small business demands professionalism and research. If you are interested in ensuring the best result when making such a decision, you should not hesitate to contact the expert staff at Business Interval.

Your answer to the question “Why am I selling my business?” determines to a large degree your final price.

If you are thinking about selling your business, it is important that you have a clear idea of how you are going to go about it. This can be achieved with a sales plan. To start this process, you will first need to identify the reasons that have led you to make the decision to sell your business, since they will directly affect the result of that sale. If you do not examine in advance your reasons for selling, it is very likely that you will make mistakes which could cost you both time and money.


– Examine your motives for selling and your desired results 


The first step is identifying what is driving you to sell your business. You should be honest, because money is not the only motivation for selling a business.

  • Would you like to retire?
  • Are you ready to move, but your business’ success depends heavily on its current location?
  • Are your assets directly connected to your business and would you like to sell it and regain your independence from it?
  • Or, are you just tired?
  • Are you no longer interested in this line of work?
  • Are its financial outcomes no longer satisfactory, and are you not in a position to put in the necessary effort to change this situation?
  • Do you need to liquidate your investment in order to direct the financial resources from the sale somewhere else?
  • Is a fundamental team member, partner or executive leaving, and is this situation going to cause immediate issues for the future of the business?
  • Has a patent which you were holding expired or has some technology been discovered that constitutes a serious threat for the future of your business in its current structure?
  • Is serious investment needed to renovate your equipment or to upgrade some of the technology and are you not in a position to do so?
  • Is there no successor to continue business operations?
  • Do you want to reduce your exposure to financial risk by selling a portion of the company?

Factors such as serious illness, divorce and the death of a family member or even just general tiredness of the owner are all strong motives for selling a business. Under these conditions, because of time constraints, the owner may be in a position where they need to accept a lower price of sale in order to attract an interested buyer.


– An immediate need to exit usually indicates the need for a lower sale price


If you rush through the selling process, it is very likely that you will lose the opportunity to make a deal that is appealing to you. Additionally, you may find a more experienced buyer, and you will be able to reduce or even eliminate entirely the transitional period, which usually leads to a reduced sale price. Of course, there are also cases in which, either due to financial necessity or other circumstances, selling the business immediately becomes necessary, in which case you lose the ability to offer financing to buyers, which often means a higher sale price.


– Planning ahead will help you get a higher sale price


Some business owners plan ahead of time the strategy that they will follow while selling their business at a very slow pace. Their motives for selling may include collecting money for their retirement or looking to accumulate capital to invest in a new business. Under these circumstances, the owner needs to find a professional financial advisor so that together they can prepare the business for sale in the correct way, and then wait for a suitable buyer. These owners are usually more flexible and willing to finance a part of the business being sold (or to provide accommodations to the buyer so they can pay the agreed price). The selling process may last for a significant amount of time, but the outcome is more likely to bring in a specialized buyer who is willing to pay a higher sale price. 


– Your interests after the sale


  • Are you worried about the future of your business?
  • As a seller, is it important to you that the business remain in its current location in order to minimize trouble for your customers and staff?
  • Do you want to leave the business once and for all?
  • Do you want to continue to participate in the business as either an owner or advisor?
  • Is there a main competitor to whom you would prefer (or not prefer) to sell your business?
  • Is there an important employee or member of your family to whom you would prefer to sell your business?

All sellers hope to get the highest price for their sale, but many are also worried about the future of their businesses. Some wish to leave once and for all while others would like to retain some level of involvement either as owners, as employees with contracts, or as advisors to the new owner.


– Sellers’ motives have a direct impact on the outcome of the sale


Sellers’ motives affect the terms of the agreement as well as their expectations for it. Besides the academic methods of evaluating businesses, the question of “why am I selling my business?” determines to a large degree the final price the buyer receives. The answer to this question profoundly affects the manner in which potential buyers will approach and structure their offers. Fully understanding your motives and the outcomes that you would like to achieve can define with certainty what variables will shape the sale and your exit strategy from the business.


– Identify and address whatever issues may be creating a conflict of your priorities


Having examined your motives for selling your business and the outcome you would like to achieve; you will likely have discovered some issues that need to be addressed immediately. You may prefer to receive the full price of the business in cash but, at the same time, you may want to settle on a high sale price. Perhaps, you want to sell the business for the highest amount but, at the same time, few changes need to be made to the way in which the business currently operates.  Whatever possible conflict of priorities you may have as an owner can put the success of the sale in danger. Issues such as these must be addressed before you come into contact with a buyer. 


– Create a list of priorities and build a sales strategy


Business advisors can help sellers address the above-mentioned conflicts, develop a well-thought-out sales strategy and achieve the best possible outcome. Developing a plan of action before selling can be one of the most effective means of eliminating a number of problems that commonly prevent an agreement from being reached. Proper preparation before selling not only will help the owners evaluate with greater accuracy their business, but it will also prepare them for the market and help them get the best possible sale price.


In every case, two conditions can really make a difference and lead to the best outcome for the seller: time and a thorough and objective valuation of the business.

  • Selling requires time and patience. Studies have shown that the average time needed to promote a business before it is purchased by an interested investor/buyer is anywhere between 6 and 12 months and, in a significant number of cases, this period of time may need to be longer or shorter. However, the more the circumstances limit the time available, the more the pressure on potential sellers will increase.
  • The fact that we have devoted a significant chunk of our lives to building a business does not mean that the market needs to pay us for it. Therefore, emotional detachment during valuation is an important criterion and usually is achieved by using professional appraisers who can be objective and provide a point of reference. Whether we take this point of reference into account and give a final price based on this valuation is clearly our own decision, but it is important that we have it as a guideline so that we know generally what is the range in which we will be negotiating. Besides the seriousness that we show to buyers, if we have not done this evaluation ourselves, they will do so themselves with their own staff, so it is crucial that we know in advance what we are selling, not from our own emotional point of view though, but from that of the buyer. 

For these things and many more, direct all of your inquiries to the experienced staff members of Business Interval.

How to decide which business to buy

If you are looking to buy a business, obviously you will want one that belongs to an industry that interests you and is profitable, or at least offers the potential for profit. However, you also want a business that is suitable for you and matches your lifestyle. In short, finding the best business to buy depends entirely on your preferences.

Before you begin your search, you will need to first set your criteria on the basis of which you will make your choice and to develop a clear picture of what exactly you are looking for in a business. In this way, you can focus on more specific options so that you find exactly what you are looking for. Otherwise, you will likely waste much time giving attention to businesses that are not ideal for you.


  • Identify what matches your daily life


The most ideal business for your best friend may not be the best business for you and your personal goals in life.

  • Do you want this business to be something that occupies you in your free time or will it be something that takes up a significant amount of your daily life?
  • How much do you want to participate in its daily operations?
  • Are you able to be present in its daily operations as an active investor/owner or will you choose the path of being a passive investor/owner and hire people to manage it for you?
  • Do you intend to just grow your business at the minimum rate in order to support your family or will you grow it to the level where it could one day become a possible IPO?
  • Will this business complement or help develop in some way another existing business that you own?

No one can answer these questions but you. There are a number of business models and different kinds of business goals, and so you will want to choose one that matches you, your preferences and daily life. As soon as you are able to formulate these things, you are in a good place to find the ideal business to purchase.


  • Identify your talents and strengths


If you intend to buy a business, you will need to know exactly what you are going to do with it – in other words, where you will fit into the equation. If you want to strengthen the business that you are buying, you will need to know how you are going to do so. Perhaps you are good at marketing or computer programming. How would this skill fit with the business that you are purchasing?

Let’s suppose that you are interested in purchasing a gymnasium that does not have any problems attracting customers and creating income, but you observe that the owner is dealing with problems in certain areas. If you are an expert, or at least know well the areas in which the owner is lacking, it may be an opportunity to add value to the business.

On the other hand, if the business requires the constant presence of strong management, it would not be an ideal choice if you have already decided that you will be a passive investor or if you are not willing to hire top management personnel. The most important thing is to find a business to which your knowledge, experience and intentions can add value and capital.


  • Pick an industry


Once you identify what your strengths are, you will need to settle on some preferred profession or industry. Each business has advantages and disadvantages and may be grown under specific conditions. For example, a company that builds swimming pools in an area with a cold climate is not a good professional option.

You need to understand the market conditions of the specific industry in which you are interested and whether it is likely that you will occupy a significant market share with your entrance into it. You will also need to investigate the market dynamics and possible obstacles to your entrance into that market from already existing businesses and the effects that they may have on your business.


  • Pick a location


With the help of technology, you can find a business nearly anywhere. However, you should know the locations where you will be comfortable implementing the plan you have developed and take full advantage of your new business. Are you looking to move? If not, you will most likely want something local. If you are going to be a passive investor or you are examining a digital business model, location may not be something that interests you as much.

Additionally, the industry that you have chosen can affect location. There are certain businesses that operate well in certain areas but not so well in others. Keep these points in mind and identify your preferences regarding location, so that you can make your buying criteria even more specific.


  • Set a price and terms of purchase


Once you have identified these criteria, an even more definitive factor –perhaps the most important– will be the price and terms of the purchase. You may find the perfect business for you, it may match your lifestyle and preferences exactly, but if you are unable to support it financially, none of these other things will be of any importance. For this reason, you will need to have an idea of how much money you can afford from the beginning. 

Just because a business is more expensive than you would like, however, it does not mean that you are unable to buy it. You can arrange to make the purchase through financing. There are many purchasing arrangements which will allow you to make a business deal that is well within the means at your disposal.

For example, someone who wants to sell their business can offer financing or profit-sharing based on pre-agreed terms. There is also the possibility of taking out a bank loan in order to acquire the business. The most important thing is that you know and emphasize both the price as well as the short-term and long-term conditions of the agreement that you are making.


  • Benefit from technology


Now that you have painted a picture in your mind of the ideal business that you would want to buy, the time has come to begin your search.

Business Interval helps you carry out specific searches for businesses for sale. You can even use advanced filters to discover listings based on characteristics such as price, location, and time of posting, among others.


In addition, our webpage is updated continuously with articles relevant to buying and selling businesses which can help you in your search. If you want to learn more about buying an existing business, take a look at the other articles from Business Interval on our website in order to learn whatever information you need.