Buying an existing business is often less risky than starting from scratch. The main reason being that the business has already established a customer base, a marketing strategy, employees and cash flow. That being said, the idea of buying a business may seem daunting. Do not let that stop you! There are some clear, and easy steps to follow that can bring you some ease and peace of mind. To be treated more like a guideline than an actual checklist, here are three steps Transworld recommends taking initially on the road to buying your next business.
Pick the right business for you
Before embarking on the journey to new business ownership, begin by looking within an industry where you are familiar. While you may buy something that is not directly related to your past expirience, it is good to start in familiar territory. In addition to industry, consider size of the business (i.e. employees, number of locations, etc.) and the geographical location of the business. Also deciding how much you are comfortable in investing in a business will help in your search. Once you have figured these details out, make a wish list.
Contact a business broker
Once you have your wish list ready, it is time to consult a professional. The pool of available businesses is often overwhelming. Where does one begin looking? How do you know what questions to ask the seller?When can I see businesses for sale? What is the right time to make an offer??
A broker at Transworld Business Advisors will not only have experience aiding in the buying and selling of a business, but also have extensive knowledge and experience in the industry of choice. Additionally, a broker will have access to a vast network of sellers who are committed to the sale process. From first negotiation to final paperwork, a broker is always right there with you.
Make offers and take a closer look
Once you have found a business you might be interested in purchasing you can then visit with the seller and ask more questions. The broker can also help by providing detailed information so you can evaluate the business opportunity. If you like what you see, then it will be time to make a contingent offer. If the seller accepts your offer, it will then be time to complete a full due diligence with the help of legal and accounting professionals of your choosing.