What a Buyer Reads in Your Commercial Register Extract Before Opening Your Accounts
In the mandates I run, there is one document the owner never looks at and the buyer looks at first: the extract from the commercial register. In Switzerland it is public, free, online, and it takes two minutes to read; Germany has its Handelsregister, Austria its Firmenbuch, and a buyer reads them all the same way. A serious acquirer opens it before asking for the accounts, often before the first call, and draws from it a hypothesis they will then spend weeks testing. Mandate after mandate, that hypothesis is the same: everything runs through one person.
What the extract says fits in a few lines. One name, with "sole signature". No registered proxy. A board of directors reduced to a single member, carrying the same name. Often an opt-out from the statutory audit, perfectly legal in Switzerland below ten full-time positions, which nonetheless tells the buyer that nobody from outside has looked at the figures in years. None of this is a mistake. Put together, it is a snapshot of a company that cannot sign a contract, open an account, hire or dismiss without its owner passing through.
I see the same reaction come back when I put the extract on the table: "That's normal, it's my company." Of course. For twenty years that organisation was the right one. It avoided pointless signatures, half-hearted delegations, regulations nobody would have re-read. The problem is not that it existed; it is that, to a third party, it describes exactly what making a company transferable consists of undoing.
Picture a company of twenty-five people in the canton of Vaud, precision engineering, owner aged 61; a scenario, not a client. The production manager has run the workshop for twelve years, the head of administration handles the books, payroll and the bank. Neither appears in the register. At the first meeting, the buyer does not ask about margins; they ask who signs material orders when the owner is on holiday. The honest answer is: nobody, or the owner, from his phone. The buyer has just measured what the extract led them to assume, and will adjust their offer accordingly, or make none.
The extract does not show what the company is worth. It shows who holds it day to day, and that is not always the person who owns it.
What can change, and how quickly, is shorter than most owners believe. In Switzerland, joint signature by two for two senior staff is decided by the board and registered within weeks. A commercial proxy under the Code of Obligations, for the person who runs finance, follows the same path. A second board member, preferably independent, requires a general meeting and a longer think about the person; a board that is not limited to the founder is in fact one of the first signals an acquirer reads in that same extract. Organisational regulations, which delegate management in writing to a named executive team, are not registered, but they are what gives the signatures their meaning. Registry fees run to a few hundred francs per entry, more when the articles of association change and go through a notary. All of it fits into six months, once you start.
One observation that keeps coming back, and tempers the previous one: a redone extract fools nobody. I have seen owners add three joint signatures six months before going to market without changing anything about how decisions are made. In due diligence the buyer then asks to meet the people registered, looks at who signed the last ten significant contracts, and compares. If the founder signed everything alone despite the powers granted, the extract turns into evidence against the seller: it proves the delegation was on paper. Registered powers should follow real delegation, never run too far ahead of it.
The extract also has a memory. Its full version, with deletions, shows the managers who received signing authority and then left. Two or three names struck out in five years tell an attentive reader about an internal succession attempt that did not hold, or a founder who struggles to let others sign. I know no buyer who takes that lightly, and none who asks the seller about it before forming their own reading. That legal reading of the company almost always precedes the financial one; it costs less, and it steers the rest.
There is one last use for this document, which has nothing to do with selling. A company whose extract carries a single name is a company that, the day that name becomes unavailable, can no longer pay its suppliers without going through a court. The same lines a buyer reads as a risk to the price, the family will one day read as a risk to continuity. That is why I advise starting with the extract, before the figures, before the sale file, before even knowing whether there will be a sale: it is the only company document that describes its dependency on one page, and it is the easiest to fix.