Entrepreneurs from former CIS countries often choose Poland to enter the Western market. The reasons are clear: the country ranks 21st in the world in terms of GDP, has stable economic growth, and the similar language and close mentality help newcomers adapt quickly.
Are you an entrepreneur who wants to save time and effort required to launch a new project and decided to buy an already operating business? In this article, based on our accumulated experihttps://youtu.be/QwPg8ELfAdEence, we will explain how to buy an existing business in Poland and avoid “failing.” What factors should be considered to ensure the investment is profitable and doesn’t end up being a waste of time and money?
- Stages of Buying an Existing Business in Poland
- Consider the option of a Polish franchise.
- Territorial Location of the Business
- How to Find a Business for Sale in Poland?
- How to Check a Business in Poland Before Purchasing
- How to Check a Company in Poland Before Buying?
- Conclusion of the Sale and Purchase Agreement
- Re-registering the Company in the KRS
Stages of Buying an Existing Business in Poland
Before purchasing an operating company, it is essential to analyze several factors that may affect its profitability in the future. It’s important to consider the location of the company, whether the niche is still relevant, and which industries could be successful in the next 5 years. It’s crucial to properly assess potential risks and try to minimize them. Additionally, familiarize yourself with the process of completing the sales transaction and re-registering the company with government authorities.
Determine the Purpose of Buying a Business in Poland
There are several reasons why most entrepreneurs buy an existing business in Poland. Let’s take a closer look at each of them.
- You want to get a residence permit (Karta Pobytu)
It is possible to obtain a residence permit (Karta Pobytu) in Poland based on business ownership. But it’s not that simple.
You need to show a net profit of approximately 50,000 PLN for the previous financial year (this amount is calculated based on the average monthly salary in the region where the business operates, which is then multiplied by 12 months. For example, in Warsaw, the average salary is around 5,600 PLN, multiplied by 12 = 67,200 PLN).
Alternatively, you could employ at least two Polish nationals without a fixed-term employment contract.
Or prove that in the future you will be able to meet either of the two conditions mentioned above. Thus, having a registered company does not guarantee obtaining a residence permit.
- Quick Start
If you want to expand your business and enter the European market, purchasing an existing company will speed up the process significantly, as transferring the company ownership in Poland takes only one day, while registering a new company takes 1-3 weeks.
- Having Licenses, Permits, or a Good Credit History
Online sources mention licenses for selling alcohol and tobacco. I’m 99.99% sure you’re not planning to engage in these areas. Here’s a real and relevant list of licenses that might be useful for small and medium businesses: transportation license, passenger transport license, music license, event permit, etc. Additionally, these could be not only licenses but also Registers, Approvals, and Permits.
Obtaining such documents (licenses) is a lengthy procedure, typically taking from 3 weeks to 2 months. Therefore, it might be more beneficial to buy a business that already holds the necessary permits. However, you should keep in mind that a business sale with licenses for regulated activities will be priced significantly higher, as obtaining these permits also costs both time and money.
Choosing the Right Niche and Location for Your Business in Poland
It’s clear that you should choose a field you are familiar with. Selecting areas where you already have experience and knowledge will significantly increase your chances of success in a new country with new laws. For example, if you have experience in construction but decide to buy a beauty salon in Warsaw without having prior experience in this niche, it might not be the best investment. When choosing a niche, it’s also important to assess your own abilities.
Analyze Your Competencies
Once you’ve determined your goals, assess your strengths and weaknesses. Do you have enough competencies to manage such a project?
Also, analyze how well you’ve studied market demand and competitors. Do you have the legal knowledge to understand the nuances of legislation, or is it better to hire a specialist or find a partner for this? Can you handle the new business with the resources you currently have, or will you need additional employees? Do you speak Polish or English? Or do you need to improve your language skills?
To help you with these questions, I suggest using a SWOT analysis. This method helps analyze the current situation and future prospects of the project. For your convenience, I’ve prepared a template, which you can download here.
How to Use SWOT Analysis
Download the template or take a piece of paper, divide it into four parts, and analyze each square.
Strengths and Weaknesses are internal factors, and they are easier to analyze. Answer the following questions:
- Do you know Polish and English? At what level?
- Do you have experience running a business in your country? What results have you achieved?
- How well do you know Polish legislation?
- What is your standout skill?
- What is your weak spot?
- What resources do you have?
- How far is your place of residence from the border with Poland?
Write the answers in the corresponding square.
Opportunities and Threats are external factors. They are typically circumstances you cannot control.
Questions that will help you understand your strengths and weaknesses regarding external factors:
- What opportunities do you see when entering the Polish market?
- What changes in Polish legislation, politics, or social life could be beneficial to you?
- What are your competitors doing better than you?
- What obstacles might you face when buying a business in Poland?
- What can you gain by entering the European market?
When analyzing, be objective. Look at yourself through the eyes of your clients, partners, employees, friends, and acquaintances. The result of the analysis will give you an understanding of which direction to take when choosing the niche and location for your future purchase.
Consider the option of a Polish franchise.
In this case, you get an established name (if you’re lucky, a big brand), a business model, and thus reduce the payback time. Registering a new company in Poland and optimizing business processes will take time, but if you buy an already operating business where everything is set up, the money you invest will pay off faster. However, in most cases, a franchise is not cheap. Its cost may not be a one-time payment, but periodic payments or both options combined.
Nevertheless, franchising can be a good option for starting with a small business purchase. You can find franchise catalogs on FranchExpert, Franchising.u, Business-asset. I also recommend watching a video that is still relevant. The video is about failed businesses from 2019-2020:
When choosing a niche, take into account the demand and supply in the market. Let’s take transportation companies as an example. Poland is a major operator of international transportation within the European Union, and it is likely that the demand for transportation services will grow. Therefore, this is a promising industry worth considering.
Territorial Location of the Business
Carefully consider the location where your potential investment will be. For example, when considering Warsaw, you need to understand that:
- The purchase will be more expensive than in other cities because it’s the capital;
- Office rent and maintenance expenses, as well as staff salaries, will be higher;
- The pace of life and market reach are greater.
If your business is related to export-import or there is a need to frequently cross the border, it may be more advantageous to buy a business in Kraków, since it’s close to the border. If the business involves frequent trips to Germany or the Czech Republic, choosing Wrocław would be a justified option.
How to Find a Business for Sale in Poland?
You can use the services of specialized organizations that deal with the sale of businesses. They select options according to your requirements and budget, perform audits, check the reputation, and forecast future profits and prospects. This option is the most expensive, but also less risky, especially if it’s your first business and you lack experience in evaluating a company. My partner and I made many mistakes at the beginning and know how to avoid them. If you decide to buy a business in Poland, we can help with this. We know the ins and outs. Leave your request on Uniconsulting.group and we will discuss your situation.
An alternative option is to find someone who wants to sell a business. Check platforms and classifieds (Olx.pl, Flagma).
Typically, in such groups, members help each other, share experiences, and make recommendations. Below is an example of how to find such a community on Facebook.
Enter “business in Poland” in the search bar, and you will be shown all the communities available on Facebook. I recommend checking all of them out.
How to Check a Business in Poland Before Purchasing
Whether you’re searching for a seller independently or through intermediaries, it’s important to verify information about your future investment in order to minimize risks (such as falling for an unscrupulous seller or purchasing a company with debts). Here are some things to check:
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Why the business is being sold: The niche may have saturated, or the business could have a damaged reputation. Alternatively, the owner might be relocating or simply pursuing another venture.
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Financial analysis: Review financial statements like annual reports, income and expense balances, and a list of the company’s assets.
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Existing debts: Check if the company has any outstanding liabilities.
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Competitiveness: Evaluate how competitive the business is in the market.
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Staff qualifications: Assess the skill levels and qualifications of the employees.
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Condition of equipment: Determine how worn out the company’s equipment is.
How to Check a Company in Poland Before Buying?
There are two ways to verify a company:
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Paid audit: You can hire professionals to conduct a paid audit. There are many companies in Poland that provide this service for a fee. This option is recommended if you suspect something is wrong with a company you’re interested in. It’s also suggested for those who have never bought a business before and are about to make their first major investment.
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KRS (National Court Register): This is an open system where you can access information on all legal entities in Poland. Here’s how to use it:
Go to the KRS website, select the type of registration, enter the NIP number, confirm that you’re not a robot, and click the search button.
In the next window, you will see the registration number, the name, and the city. Click the “Wyświetl” button.
A window will open with registration details — the name of the president and board members.
You can also download a PDF with complete and up-to-date information at the time of viewing.
The website is in Polish, but you can translate the page using Google Translate.
Conclusion of the Sale and Purchase Agreement
If everything is in order with the company and the price is right, the next step is to formalize the deal.
Documents needed:
- For individuals: a copy of the passport.
- For legal entities: the company name, copies of documents showing its registration and address.
The process of transferring ownership rights is as follows: you meet with the seller at a notary, who, after verifying the documents, drafts the agreement. At the end, a document is signed, confirming the transfer of the company and the payment or the date when the full amount will be transferred to the seller’s account.
After that, you will receive all the necessary documents for work: an individual tax number, founding documents, and an extract from the court register. These documents will show the company name, the types of activities, the legal address, and the new owner (you). Here’s a little tip: if necessary, you can immediately ask the notary to change the name, revise the types of activities, or add or remove a cash register. The notary can modify any inconvenient aspects while preparing the documents, saving you $200-300 in the future.
When purchasing a business, you also acquire its bank account, which may have either a positive or negative balance. For example, if a company is sold for 55,000 PLN, and 50,000 PLN is in the account, with 5,000 PLN representing the value of the company, that’s an important consideration. By the way, this is one of the reasons companies are sold. After all, withdrawing money in Poland means paying an 18-19% tax.
Keep the accountant in mind. They will either stay with the company or you will need to hire a new one.
Make sure your actual and legal addresses match to avoid problems in the future. For instance, if you bought a car wash in Gdańsk, and an inspector comes for a check at the address listed in the KRS, but the car wash is actually located in Kraków, this could raise suspicions and questions you don’t want.
Re-registering the Company in the KRS
The next step is to make changes in the state register. You can do it yourself, but it’s better to entrust this task to someone who knows Polish law and the ins and outs of buying and selling businesses. By contacting Uniconsulting.group, you will save time and energy that you need for adapting to the new business conditions. The changes in the register will take effect within a month, but you can start operating already.
In conclusion, I want to say that buying an operating business in Poland is a great investment option, though, unfortunately, without a 100% guarantee that the investment will pay off. Success largely depends on how quickly you understand the work processes.
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