Buying a Business: Contents
1. Buying a Business: An Introduction To
You may want to buy an existing business instead of starting a new one yourself from scratch. Your inspiration behind this could be that you believe all the initial work of setting up and establishing the business is not your greatest ability: but one issue always sticks out when buying a business: you do not know why the business is up for sale!…
2. How and Where to Find a Business for Sale
The first thing to do before you search for a business is to make a criteria list for the ideal business you are looking for. Don’t be too specific or your list will eliminate practically every business out there…….
3. Using Business Brokers to Help Buy a Business
Business transfer brokers are highly recommended to help you buy a business. If you choose to use one, make sure that they are the best you can find (ask lawyers, accountants, and business associates to suggest quality firms)……
4. Researching a Business to Buy
Research is the most important part of buying a business. If it is not done properly you could end up buying a business that turns out to be your worst nightmare. By researching as much as you can, it will give you the confidence to go ahead with the deal or to walk away…….
5. The Duediligence Period When Buying a Business
Before you enter the process of due diligence, you will be at a point where you will have looked at operations, facilities and financial statements of the business……….
6. Researching the Business Premises, Stock and Accounts
Look around the premises to see if they suit the operations of the business. Is it big enough to run the business, particularly if you are using the site for production? Will the amount of stock you expect to hold be easily stored especially during times of high demand? If not, would an extension solve the problem or would you have to relocate completely?……….
7. Researching the Business Assets, Competition, Products & Debtors
Again, this is where your accountant will come in useful to put a value on any assets involved. It may be that the owner has used the buying price to value fixed assets such as vehicles and equipment and has completely ignored depreciation…….
8. Researching the Business Creditors, Equipment & Employees
Discover the amount of money that the business owes and use the accounts (cash flow forecasts) to provide an answer to whether these can be paid back, more importantly, on time……….
9. Researching the Business Suppliers, Industry & Partnerships
If the business has any suppliers, you will need to analyze them to find out if they are the best available to the business. This will cover looking at the prices they charge and their credit policy………….
10.Researching the Business Insurance, Legal Issues & Goodwill
There are many issues involving insurance within every business. Here are some of the most common Insurance terms explained:………..
Arguably, a business is worth what-ever someone is willing to pay and therefore will vary from person to person…….
12.Valuing a Business: The Asset Value and Payback Value
Different methods are also used depending on the size of the business and so we have stuck to the main ones that are generally used to valuing Small Medium Enterprises – ‘SME’……..
13.Valuing a Business: Return on Investment, Income Value & Owner Benefit Value
For a return on investment value, we are assuming that no fixed price has been given for the business and therefore you will use the net profit and your proposed return on investment percentage to determine a price……..
14.Valuing a Business: The Multiplier Valuation
This area is very subjective and there will be a variation in people’s attitudes and opinions for the figures involved.
15.Closing the Deal When Buying a Business
After going through all the processes of finding, researching and valuing a business, you are finally left with the negotiations to complete the deal. All those things that are involved in buying a business share equal importance and the negotiations have no exception…….
16.Negotiating the Final Deal When Buying a Business
As stated above, when negotiating a deal, you should ask the seller to put any other interested parties on hold and that they give you their full attention in trying to make an agreement………
Franchising is about cutting YOUR risks when deciding to run your own business, by jumping on the band-wagon of a proven business enterprise and name:…..
18.Buying a Franchise: Your Business Territory, Financing & Training Issues
The franchisor will have a plan that shows the maximum franchises an area will have: numbers will reflect the number of businesses and/or homes in any given area. London may have 50 franchises, Leeds 15, but a small town could only support one…..
19.Franchise Exhibitions & The Pros & Cons of Franchising
The franchisor should have a planned launch campaign that has been used in similar circumstances and has proved to be successful…..
20.Researching a Franchise Business - Costs and Commitments of Your Franchise
The following will give you an idea of what is included in the documents and what they will inform you about. If anything is missing or if you identify areas of concern, contact the franchisor to discuss and solve the issue……
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