Exit option: Selling -> Trade Sale
Exit strategies

A trade sale occurs when you sell the business (or parts of the business) to another outside party. It can be the best way to get a good price - but you'll need to develop a business that's attractive to potential buyers.

If your business is not already limited, it may be difficult to achieve a trade sale as the value of the business is likely to be heavily tied to the skills or business relationships the owner has developed. The business may also appear less well established and therefore less attractive to potential buyers.

If you did not start out as a limited company, it is worth considering incorporation before pursuing a trade sale. This will give the business its own legal identity, and selling on the business' trade, assets or customer list should be easier.

Your chances of a successful trade sale can be improved by drawing up and following a clear exit strategy and minimising the potential hurdles to a successful exit. For more information see the pages in this guide on why you need an exit strategy and decisions that could affect your eventual exit.

Developing the following characteristics can also help to make the purchase of your business a realistic proposition:

• show year-on-year increasing profitability
• create a high-quality product or service
• develop an innovative product or piece of intellectual property
• build a strong customer base
• recruit a high-quality team
• maintain premises and assets in good condition

For more information, see our guide on preparing to sell your business.