Bayani Lauraya, Managing Partner, Kreston Thailand
Most Thai business owners preparing to sell have never really looked at their own accounts.
They know the business is profitable. They see cash coming in. They take dividends. But they have never sat down and asked: What is this business actually worth? What can a buyer see that I cannot? What am I leaving on the table? The answer is often millions of baht.
The Problem: Untimely Reporting Masks the Real Story
When I work with Thai business owners considering a sale, I start by asking for three years of financial statements. The response is almost always the same: incomplete records, expense categories that make no sense, owner distributions mixed with operating costs, overhead that nobody has questioned, and no visibility into trends or margins.
This is not a compliance problem. It is a valuation problem.
The issue is not that the accounts are wrong. It is that they do not tell the story. Without monthly closing, variance analysis, and trend visibility, business owners cannot see what is actually happening. They do not know if margins are declining. They do not understand which customers or products are profitable and which are destroying value. They do not realize that people costs are growing faster than revenue, or that overhead has become structural and is now eating away at EBITDA.
Buyers will see all of this immediately. They will conduct due diligence that forces you to confront the difference between what you think your business is worth and what it actually earns. If you wait until they arrive with their questions, you will be negotiating from a position of weakness. If you conduct that analysis yourself first, you control the narrative and unlock value you did not know existed.
What We Have Seen: Real Patterns Across Multiple Businesses
I have worked with business owners across publishing, marketing agencies, manufacturing, and food and beverage. The pattern is consistent, and it costs them millions.
A marketing agency owner believed his business was stable. Revenue was flat but consistent. He took a healthy dividend every year. When we analyzed contribution margin over three years, we discovered it had declined steadily. Why? Overhead and people costs had grown every year while revenue had stayed the same. The business was heading toward a margin collapse. If he had sold without this analysis, a buyer would have seen a declining margin trend and either walked away or demanded a significant discount. Once he understood the issue, he could make an informed choice: restructure the overhead before sale to improve valuation, or be transparent about what a buyer would find and accept the consequences.
A manufacturer with seven production locations had never analyzed which locations were actually profitable. When we broke down EBITDA by facility, we discovered that two locations were operating at negative EBITDA and had been for years. The owner assumed that closing them would hurt valuation because of the closure costs involved. In reality, closing them improved valuation significantly. Buyers do not value revenue that loses money. They value profitable operations. A location generating negative EBITDA reduces enterprise value by more than the revenue it brings in. Once the owner understood this, the decision became clear. The closure costs in the short term were far outweighed by the improvement in valuation.
A food and beverage business owner had not tracked what was driving revenue declines over the past two years. When we analyzed by product line and customer segment, we identified which lines were losing customers and which were stable. We then went deeper and analyzed branch-level EBITDA. Up to 20% of branches were operating at negative or borderline EBITDA. Some locations could not be fixed without fundamental changes and closing them would immediately improve cash flow and profitability for the company. Other branches could be returned to positive EBITDA with targeted actions such as renegotiating rents and adjusting the local cost structure. A buyer would see loss-making branches and an unchanged overhead base as evidence of structural decline and would either pass on the deal or apply a steep discount. The owner could either right-size the footprint and cost structure before sale—or accept that the valuation would reflect the risk.
In all three cases, the owners did not have timely, useful financial information. They knew how much cash they took home, but they did not understand what their business was actually earning or where the real problems were hidden in the data.
The Real Work of Preparation
If you are considering a sale, start here: Conduct a thorough review of three years of financial records. Do this before you approach any buyer.
Get your accounts audited or at minimum reviewed by a qualified accountant. Separate operating expenses from owner-related distributions. Identify non-recurring items. Then do the hard part: analyze margins and trends. Break down profitability by product line, customer, or location. Understand where revenue is declining and why. Identify overhead costs that have grown disconnected from revenue. Find people costs that are no longer justified by the business performance.
This analysis will reveal three categories of opportunity.
First, removable costs. Expenses that benefit the owner but are not necessary to run the business. For every THB 1 million in removable costs you eliminate, you add THB 1 million to EBITDA. If buyers apply a 5x or 6x multiple, that removal just recovered THB 5–6 million in lost valuation.
Second, structural inefficiencies. Overhead that has grown without adding value. Product lines or locations that destroy EBITDA. People costs that are no longer proportionate to revenue. These are harder to see without proper trend analysis, but they are real value destroyers. Once identified, they become opportunities to improve before sale.
Third, value gaps that require acknowledgment. If your analysis reveals that margins are declining or that a key location is unprofitable, a buyer will find it during due diligence. Better to find it first, understand the impact, and show how the rest of the business is strong enough to absorb it.
A business owner who understands EBITDA, margins, and trends before approaching buyers is in complete control of the conversation. You know what value you have. You know what a buyer will adjust for. You know what levers you can pull to improve the business. You can walk into negotiations from strength.
The owners who do this work are also the owners who get better terms. Not just price. Structure. Timing. Earnouts. All of it flows from having prepared financials that tell a clear, understood story.
If you are thinking about selling your Thai business, speak with our team before you approach any potential buyers. The first two weeks of preparation determine most of what follows. We can help you understand your accounts, identify hidden value, and quantify the gaps you will face. The difference it makes to your final valuation is usually substantial.