March 2020
When deciding to purchase a business it is important to find a business that interests you, fits your lifestyle and lends itself to profitability. Before looking for a business it is helpful to make a list of what types of businesses interest you, what types of businesses do you have experience in, and what type of businesses will you be able to succeed at. Below are a few easy steps to help you decide.
1. What Are Your Skills, Strengths, and Interests?
You want to choose a business that fits your skills, strengths, and interests. Do you have a special license or hold a degree in a certain field? You want to pick a business that you have knowledge about, experience in, and proper credentials. For example, if you are a licensed beautician then maybe consider buying a salon or beauty bar. If you are an excellent handyman and understand how to build things, then maybe a construction business or hardware store would be a good fit. The more passion you have the harder you will work and be successful at growing the business.
2. Will the Business Fit in with Your Lifestyle
You need to ask yourself if the business you are interested in will fit with your lifestyle. Purchasing a bar or restaurant that requires you to be there all night, but you need to be home for your family at night is not going to be successful. Make sure you know how much time you can dedicate to the business. Are you looking to be hands-on and at the business every day or are you looking for something that requires little involvement on your end and requires you to be a semi-absentee owner? Is the product that is produced by the business something you believe in or would you have a hard time convincing someone to buy the product? Are you a people person that likes to interact with lots of people and be constantly networking? Then purchasing an online-only business probably isn’t what you are looking for.
3. Select Your Location
This is a very important step. You want to make sure the business you are looking for matches your desired location. Are you willing to relocate to a different area of town or possibly out of state? Is the location of the business in a good area of town or in a good area that supports the business? Is the commute something you will be willing to do if you need to be at the business every day and at all hours of the day. Having a business in a good location will help you succeed and stay interested in growing the business.
4. Deciding on the Purchase Price and Terms of the Agreement
Now that you have decided on what type of business you would like to purchase, you have shopped around and found the business for you, you will want to decide on the purchase price and terms that will work for you. Make sure you have hired a professional business broker to help you with all these steps. Perform your due diligence and investigate the entire business weighing all the information. Know how much cash you have available and how much you are approved to finance. Consider how much cash you will need to operate for the first few months. Then present the offer with the price you can afford along with the amount to be financed with terms that will help you succeed. Again, your business broker will be the one to lead you in the right direction.
Purchasing a business, you have knowledge of, have a passion for and the right credentials will help you succeed and make the most out of the business. Employing the expertise of a professional business broker will help you locate the right business and make the best offer with the right terms for you and your family.