Buying a Business: Avoiding the First Year Glitch
If you wish to start a new business, you need to be ready of all the risks that shall follow. You will be shocked to learn that not all business that start off anew make it past their first year of operation. You are better off buying an already established business.
Apart from lowering the risk of failure, you shall start earning an income from it from the onset. With a new business, you may have to give it all you have before it starts giving back any of these funds. Since you are not that well known when you have a new business, you shall take a long time to make an impact in the market. You also get ready staff who will not need time to find their footing.
This does not mean you should go for the first opportunity you get to buy an established business. You need to do your homework first before settling on any of them. You need to also take a long look at what you bring to the table. You need to also think of buying a business dealing with products and services you are familiar with. An an example is someone who has studied pharmaceuticals, looking for a business that deals with the supply of medication.
You need to also go for a business you shall have a nice time doing. This is a business that is about to take up so much of your time. There is no need to make it a time you shall come to resent.
When you set out to buy a business, research is the first thing you shall have to do. You need to have come up with several businesses you are comfortable dedicating your time doing. You need to then figure out your professional skills, business experience, and core competencies. You need to then look at how much money you have.
This is the stage in which you know what business you need to go for. IT shall be time to present your offer. In your offer, you need to consider the price of the business, the training necessary before you start running it, the assets the business possesses, the financing details you shall get from the current owner, and the details of the non-compete agreement.
After you have both agreed, you need to have all that was agreed on in writing. IT is important that there is a business attorney present, so that the transactions are deemed as legal.
There are a lot of expenses to be incurred when you opt to buy a business. You, therefore, need to be careful how you go about making your purchase. You need to make sure you end up with the right type of business.