Guide to buying a business
Aug 03 2009
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1. Do not be tempted into paying too much to buy a ready-made business because you want your business life to get off to a flying start.
2. Clarify your thoughts about the market you want to enter, the size of business you want to run, the type of product or service you want to offer and how much you want to pay before you start searching for a business to buy. Summarize it in a business profile.
3. Consider seeking out a business which fits your profile as well as investigating all those currently advertised for sale.
4. Use advisers to help you investigate a partnership or business.
5. Adopt a sceptical approach to investigation; query and question everything about the business.
6. Be realistic about the effect of a change in ownership; there could be changes for the worse as well as the better.
7. Set two prices before you go into negotiation; the lower one with which you start the bidding, a higher price beyond which you will not go.
8. Negotiation is everything. There are no rules; there is no right price for any business. It is up to you to summon your facts and marshal your arguments to keep the price as low as possible.
9. Use the Tips on negotiating when buying a business.
Comment by Ed Whiting
Tuesday 2nd March 2010The main key advice that I would add for people looking to buy a business is 1. Rigorously do your research and due diligence on the business 2. Make sure you are capable of running the business and that includes the support of the people round you 3. Avoid businesses that you know nothing about – if you do want to get into something new, go get a job doing the same thing before you commit to the change. 4. Go with your gut feel it is usually right!
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