Starting a New Company or Buying an Existing One? Advantages and Disadvantages

When you decide to start a business, you generally have two options: establishing a new company from scratch or purchasing an existing company. Each option has its own advantages and disadvantages. In this article, you will find the key points to guide you through the decision-making process.

Advantages of Starting a New Company

Low establishment cost:
Starting a new company is quite cost-effective. Although the amounts may vary depending on current procedures, you do not need a large initial capital to get started.

Clean history:
When you establish a new company, you do not have to deal with past debts, losses, or a negative record. The company is entirely under your control.

Tax advantage (VAT exemption):
You do not pay VAT until a certain turnover threshold is reached. This is a significant advantage for new entrepreneurs.

Disadvantages of Starting a New Company

Restriction on employing foreign workers:
Newly established companies cannot employ foreign workers during their first year of operation.

Lack of credit history:
Since new companies do not have a credit score, obtaining bank loans, leasing options, or vehicle/home financing is almost impossible.

Additional licensing requirements:
In sectors that require special permits, such as logistics, you must apply for licenses from scratch.

Advantages of Buying an Existing Company

Ready licenses and infrastructure:
You can directly use the existing licenses of the company you purchase, which saves you time.

Credit score and reliability:
Companies with an established credit history are more advantageous when applying for bank loans and leasing.

Disadvantages of Buying an Existing Company

Debt risk:
The company you purchase may have outstanding debts. If a professional due diligence process is not carried out, you may become responsible for these liabilities.

Risk of fraud:
If you do not speak the language or lack experience in this field, there is a high risk of being sold a company with debts or legal issues.

A Secure Process with Professional Support

We are fully aware of these risks and provide our clients with a secure and transparent process. Together with our lawyer, accountant, and team, we identify the most suitable and clean company for you and carry out all necessary checks.

As the prices of existing companies vary depending on many factors, you can contact us to learn about the most suitable option for your needs.