Buying a Business
Buying a business is a lot like finding the right person to marry. You must know yourself well enough to know what you’re looking for. It’s usually a long term commitment and often a life changing experience for the first time buyer. This is a short list of initial steps to take.
I’ve sold businesses to people over the years with various motivations for buying. I wrote an article for a newspaper business section titled Money, Person or Time.
It was addressing the issue of what the most important thing was to consider when selling. I realized later the title would apply equally to the buyer. Simplified, is the money risk and reward heavy enough on the reward?
Am I the person for the business? Do I have the skill set needed or interest in learning a new business? Is it the right time in my life, or that of my family to buy the business?
- Financial Statement:
Qualifying yourself to buy a business is no different than buying a house. Business brokers will be able to expedite your opportunity to make offers with a financial overview. It should be specific to show liquidity after liabilities and signed by you.
- Financial Needs:
You’ll have to decide what amount of money, if any, is needed after debt service to maintain an estimated life style. That key factor will refine the search. Don’t underestimate the need for unforeseen expenses.
- Your History
There have been very few sellers that didn’t care if their business continued for any length of time after the sale closed. For that reason, and to possibly enhance your bargaining position, a verifiable resume is important.
- Consider your thoughts on the items above as a whole and refine until you’re sure one way or the other whether should start your search.
- Call me and we’ll talk about how we can do business.
Maybe one in ten have bought the business that they called me about. Searching and finding the right business for qualified buyers has accounted for about half of my business. My success in finding the right opportunity is largely due to my knowledge of the rich North Texas businesses scene, a genuine interest in the business owners that I contact and an honest, straight forward approach to producing win-win deals. My track record is verifiable.