When searching for the right business for you, start by determining the minimum amount of income you are willing to earn. If a business you are interested in cannot deliver that income, cross it off your list. Next, decide how much time you want to spend on the business. Narrow down your list even further by removing the businesses that cannot deliver the lifestyle you want.
2. Buying A Business Is Less Risky Than Starting One
Starting a business also means starting from scratch and dealing with all the paperwork that comes with it. However, buying an existing business means receiving an operation that is already creating cash flow and profits.
3. Hire A Business Broker
There are a lot of choices you face while deciding what business to buy. Business brokers know the market inside and out, can offer professional insights, help you narrow down the list of businesses to buy, and guide you through the whole buying process. They also have access to silent listings: a type of listing that has no marketing program and is only presented to suitable buyers.
4. Your Success Team
Get the appropriate experts in law, business accounting and finance to help insure you get the best deal and the most efficient business transfer possible. At B.A Boss we ease and help you through the process.
5. Conduct A Thorough And Objective Investigation
Once you have found a business you would like to buy, it is imperative you research important information about the business before starting negotiations. Be prepared to sign a confidentiality agreement, ensuring you will only use the information provided to you to decide whether or not you want to purchase the business. Your Finn Business Sales Broker can help you to understand contracts and leases, financial statements, tax returns and other important documents used to operate the business.
6. Determine A Fair Price
Determining a price is the most emotionally charged part of the whole buying process. The seller will have one idea of how much the business is worth, while you, the buyer, will typically have another. Many factors go into determining a price, but usually the party who is most prepared has the most leverage. Your Finn Broker will prepare a Business Profile Document and Due Diligence Package for the business you are interested in buying.
7. You Are Unproven
Existing businesses have an established brand and reputation; you are the risky one. When discussing buying an existing business with a broker, or the current owner, you need to show how you plan to grow the business and why you will be a good owner. Over the last 10 years, more than 99% of the applicants we present to business owners have been approved and resulted in a sale.
8. Buying At A Fair Price
Business appraisals are a mix of art and science. However, there are ways of estimating a fair price. If you want the expert in your corner, B.A Boss will help you to review the business information for the opportunity and highlight your negotiation opportunities for a better result than if you choose to go it alone.
9. Getting Finance
Use a professional commercial finance broker who will guide you through the financing process. They will prepare your application and find the best deal for you. Approaching your local bank direct about business finance can often result in an unnecessary knock-back – ask us for the best way to get finance from the major banks.
10. Start The Transition Process Before The Deal Is Complete
To ensure a smooth transition, start working in your new business with the existing owner before the deal is complete. Take the time to talk to employees, customers and suppliers, and ensure you are properly trained in operating the business.