Buying a Business

business brokerThere is no doubt that buying an existing business has its risks, but it’s still a lot safer than starting one on your own. After several attempts to find that perfect business opportunity, seasoned entrepreneurs develop a natural ability to sniff out all the red flags and recognize that “diamond in the rough.”

Unlike startups, an existing business already has the necessary equipment and inventory necessary to run efficiently. In addition to its customers and employees, these businesses already have a location, and might even have a few years left on the lease. But perhaps more importantly, the business has a track record; meaning as a buyer you can look at their records, books and tax returns to get a sense of your potential income. So, you may be asking yourself, where is the risk?

At some point or another, almost everyone experiences some type of career burnout.  Either you are in the wrong career and it’s wearing you down or you need more time to enjoy your family, but you may have been bitten by the “entrepreneurial bug.”  Before you go out and buy a business online or try to start one yourself, there is a lot to be learned about business ownership.

It used to be that if you wanted to find businesses for sale by state you would need to search through the newspaper classified sections in a local library.  Thankfully, today’s entrepreneurs can rely on Internet business directories that list businesses “for sale by owner.”  Now, in addition to finding out about existing businesses for sale by industry, one can search by zip code, city or state.  If you’ve never searched for a business this way, the first experience with it might be overwhelming.  Most prospective buyers are amazed at the number of listings in their area.

If you’re considering a business acquisition, it makes sense to look at a business FSBO directory, but it also makes sense to take the proper precautions.  As you might expect, some of the listings in these directories seem too good to be true, but that is because the seller wants to attract a lot of potential buyers.  Oftentimes, it is only after thoroughly investigating the financial statements and interviewing the owner can you feel comfortable proceeding with the purchase.  But even then you might be missing some information.

Just like in the real estate business, it would seem that FSBO business opportunities would be preferable to working with an agent or broker. In reality, FSBO opportunities only work well in situations where the buyer is already familiar with the industry, the business and financing.  For example, if you owned a few dry cleaning shops already, and wanted to expand and buy another one, then it would make sense to look for FSBO opportunities.  First of all; they’re likely to have a lower purchase price than those being sold by a broker, and secondly the transaction may go a lot faster.

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Click to contact us for help buying or selling a business.  Since 1980 we have been in the "business of business." We are a professional company specializing in bringing Business Buyers and Sellers together. Being one of the Nations leading firms in our industry, we are best equipped to help you because of our background and years of experience in working with business buyers Nationwide and businesses of all sizes and types. Your business purchase or sale information will be handled by experts and conducted in a confidential manner.

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