Acquire an already-established biz and save yourself the Migraine of starting a field from scratch.
Whether you retain idea approximately starting a metier, on the other hand don't demand To erect one from the ground up, concede buying a business that is already established. In reference to the benefits to buying instead of starting from scratch, "Entrepreneur" Periodical states, "You don't acquire to reinvent the wheel--setting up modern procedures, systems and policies--since a extraordinary formula for running the field has already been settle in apartment." Eliminate the headaches of a new start-up and capriole on the bandwagon of an excuse already headed toward achievement.
Instructions
From the Research Stage to Accepting the Keys
1. Stick with what you be versed and decide early what you're looking for. Assemble a information of your distinct goals and the reasons that you thirst for to convert a episode owner. Choose a affair Production in column with your recent experiences, your goals and your skill sets. Narrow down your search to geographic areas that you catch most favourable. Factors to allow for admit the flair pool in the community field, territory and resident taxes, and regional buildup trends. Cause a string of criteria that you are looking for in the craft you pay for.
Review patents, trademarks and copyrights. Your lawyer and accountant should help you review all documentation to ensure that you are receiving everything promised in the sales agreement.11. Evaluation online listings with complication brokers and Commerce associations for livelihood for sale.
3. Establish up a duo of advisers. Link up with a episode broker. Calling brokers search for businesses that fit your criteria, maintenance with negotiating the deal and assist entire the paperwork involved. Bend a counsel to facilitate you with forbearing the legal requirements of closing a sale and an accountant to maintenance you pep wrapped up the financial statements of a affair that you longing to purchase to lock up its profitability.
4. Assemble a information of business opportunities. With your team of advisers, narrow down your list to the top three choices. Use your list of criteria and your individual goals to check off attributes each business has. Create a folder for the three businesses that meet the most attributes from your list. You will add information to these folders as you review the opportunities further.
5. Interview vendors, customers and suppliers to receive a feel for the reputation of the companies you're reviewing. Contact credit-reporting agencies such as Dun and Bradstreet to review the companies' credit histories. Ask for the business plan from the sellers. Tim Berry, business-plan expert, says, "The business plan---or its absence---may tell you a lot about the business, its history, the owner's view for its future, and their interest in selling." After reviewing the plans, narrow the list down to the one you're most interested in.
6. Present a letter of intent to the current owner based on a general fair market value of the business. Most business owners won't give you access to all financial records without one. Your lawyer can help you come up with some numbers. Review the financial statements and the earning history of the company. Predict its future growth potential and determine the value of the intangible assets, such as licenses the business may own and the strength of its brand name. Review income statements and cash-flow statements for the last three to five years. With the accountant's help, use all the financial documents available to foretell future growth and the health of the business.
7. Subtract all liabilities to receive a more accurate picture of the health of the business. Take in to account used or leased equipment, loans, pending court cases, accounts-payable records, costs to advertise, and any other expenses you are likely to incur once to take over the business.
8. Negotiate the sales price. Ask for a reduction in price at least equal to the payables owed. Make a formal offer and have your lawyer inscribe and present a sales agreement. The sales agreement should include every detail of the sale such as the assets being sold, the seller's role in the new business, fees and date of closing.
9. Find the money to buy the business. The Small Business Administration says, "The financial cost of acquiring an existing business is usually greater then starting one from nothing." Dip into your personal savings or apply for a loan through a commercial bank. Consider splitting the cost with another buyer. Negotiate a lease with option to buy agreement if you can't get money through traditional means.
10. Perform due diligence by making sure all licenses, lease agreements and permits are up to date.2. Search classified ads in the newspapers and publications for the region you're most caught in. Oration with business owners in the existence that fit your criteria that might be awakened in selling.
Introduce yourself to the new employees and reassure them of your dedication to the company. Bring in your management team and allow them to work with the employees before they completely change the management style. Accept the keys to the business.
