| Wouldn't it be great if instead of going through the | | | | financials to see what are the forecasted expenses |
| hassle and hundreds of hours spent on developing a | | | | and revenues for the first five years of operations |
| business plan and starting a business, we could just | | | | after you buy it. After the expert will analyze the |
| buy one already launched? Maybe. The thought | | | | business and you will finish the industry and market |
| certainly sounds tempting. Especially when you start | | | | research, you will have a good idea of the chances of |
| searching for viable data that you can rely on when | | | | success the business has in the future and you will be |
| developing your business plan and you discover that | | | | ready to make a decision and plan accordingly. |
| an industry report costs thousands of dollars. Without it, | | | | Is it better to buy a business than start from scratch? |
| the reliability of the data you base your financials upon | | | | Probably not. When you start from scratch, you don't |
| doesn't even sound realistic to you. Even less to an | | | | find yourself in the situation of fixing the mistakes the |
| investor whom you plan to turn into a partner or an | | | | previous management team made, mistakes that |
| associate...Maybe it would be great if we could just | | | | reflect on the current revenues. Depending on your |
| avoid these moments that create headaches and | | | | expertise with start-up companies, starting your own |
| nightmares and purchase the already launched | | | | business gives you flexibility when it comes to time and |
| business. On the other hand, buying a venture it's like | | | | resources. It helps you through your learning curve. |
| buying a used computer: you don't know what | | | | Buying an already launched business doesn't wait for |
| problems it has and whether it already has any viruses | | | | you to catch up. You must be ready to play the game |
| until you bought it and then it might be too late. | | | | according to the previous management team's rules |
| Yes...it's true: buying a business helps avoiding the pain | | | | and try to change them on the way. Unless you keep |
| of planning and launching your own, and starting | | | | the previous management team, it can be very |
| operations from scratch. Buying a business means | | | | overwhelming and tiring. |
| already having a brand name, loyal customers and well | | | | But if buying a business seems more challenging to |
| defined products, services and developed growth | | | | you and a great challenge is what you are looking for, |
| strategies. If the business was successful, you have | | | | you have two options: buy a company's assets or buy |
| the responsibility to maintain the image the previous | | | | the company as a going concern. You should choose |
| management team created. If the business was not | | | | the option that is most advantageous to your goals, |
| successful and you plan on buying it....well, why are you | | | | but no matter what option you choose, make sure you |
| buying it? Finding the reason why the business is sold | | | | run an investigation of the current situation and |
| is very important. There may be various reasons: lack | | | | estimate the future prospects. |
| of expertise of the management team, low quality of | | | | If you want to buy a company's assets, whether it's |
| products, limited resources to develop better products | | | | equipment, location or anything else, make sure the bill |
| or to offer better services, etc. Finding this reason is | | | | of sale specifies exactly what you are going to |
| the most important action that must be taken when | | | | purchase, with detailed descriptions, prices and |
| intending to buy a business and it must be done by a | | | | attached key documents, and make sure all liabilities |
| professional who can analyze all aspects of the | | | | associated are mentioned. Generally, it is better to use |
| company. Secondly, the image the business has is | | | | this type of purchase when the company has many |
| very important as well. Talk to your future competitors, | | | | hidden assets that the management team is not |
| your future customers and the business' suppliers and | | | | aware of and has not capitalized on yet. |
| find out what the challenges of the industry are and | | | | If you buy the business as a going concern, it means |
| what their opinion is of the business you're about to | | | | that you want to own some assets which can be |
| buy. Based on their responses, find out if after you buy | | | | transferred otherwise. Buying this way requires hiring |
| the business, you can satisfy their suggestions. And | | | | an attorney, a business broker or a business appraiser |
| most importantly, develop the business plan. Don't think | | | | and the process is complicated by a long, complex and |
| that just because you are buying an already launched | | | | intensive investigation. However, the investigation will |
| business you are off the hook. You still have to | | | | help you not overpay for the business. |
| develop the business plan containing your pro forma | | | | |