First Step Marketing

This is a popular way to get into business and can be highly successful, as it shortcuts much of the difficult start-up process. Businesses are sold by word of mouth, and advertised in local newspapers and specialist publications. Shop sales are also handled by business transfer agents.

To buy a viable existing business you need to do your homework thoroughly and to maintain an open, yet cynical mind. Why cynical? Because one must examine why a good small business is being sold. If the business is doing even reasonably well, it is more likely to be taken over by a close friend or a member of the proprietor’s family, or the proprietor could employ a manager. That is not to say that good or potentially good businesses do not come on to the market, but you need be fully aware of what you are taking on and why it is being sold.

First, ensure you are well informed about the trade and the type of business you are contemplating taking over. Contact your local business development unit for their advice and ask if they can put you in touch with a similar business far enough away not to be in direct competition. If you are still interested, then the next step is to value the business for sale.

DOING YOUR RESEARCH

Obtain good advice from an accountant, who should go through the last few years’ accounts of the business and explain to you all the salient features. Be sure you also understand any tax and VAT implications of the purchase.

By buying an existing business you have access to their real trading figures, so you can make better cash flow and profit predictions than if you were starting from scratch. But trading conditions vary constantly and you must still do thorough market research to ensure that market conditions are not likely to vary adversely for the foreseeable future. If there are any existing staff, look carefully at their terms, conditions, and rates of pay as you will have to observe these. If you plan to reduce the number of staff, you could be liable for redundancy payments.

Enquire fully into the situation regarding the premises. Are the premises owned by the business or rented? If rented, then check the lease carefully. It is essential for a structural survey to be done and to find out if you would be responsible for the repairs and insurance of the building. The surveyor can also comment on the lease prior to you consulting your solicitor.

If the business you are buying is a limited company, you will need to obtain excellent legal advice, because when you take on a company (usually by the purchase of a majority of its shares) you take on not only the assets, but also all of its liabilities, which might be substantial. Ideally, and wherever possible, you should aim to acquire the assets rather than the company itself.

In result, every Business and Office Softwares Wholesale List, BlackBerry, Business Planning Store, Wholesale Detergent Suppliers, The Financial Times Guide to Drop Shipping, Zurich Tax Handbook 2009-2010 Accessories, Wholesale Business and Finance Books, Textbook Price Regulation, Economics Textbooks, Cheapest Zurich Tax Handbook 2010-11 and Business and Finance Textbooks Wholesale Price wholesaling drop ship goods is basically understood to mean by providing internet wholesaling goods in advance of payment.

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Buying an Existing Business

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