looking for an existing business

Welcome to USABF

Unless you know what you are doing, the pitfalls of buying a business can be far greater than starting one from scratch.

This is often more so if you are buying a small business. While you are gaining the benefits of established trade you are also at risk of paying well over the odds for a load of old rope.

First off Amy, do you understand a 'Profit and loss sheet' ?

Hi Amy welcome to the USABF

There are much better established websites than the one you have found, but your question is such a complex one, that it would be different answers for different people.

It will depend on your current business knowledge, as IP says, basics such as profit and loss accounts.

Budget, this will decide what kind of business you will start or buy. Maybe you want the safety net of a brand, in which case franchising could be an option.

Are you looking at starting up by yourself, or do you have an experianced business partner?

No I don't - but great spam post though Tut Tut

yup, and link removed

I think it's better to start your own business because you might not know how to handle an existing business.

That is true unless if you're planning to try franchising because they will provide training to their franchisee.

Amy,

I am a business broker that specializes in selling existing businesses with positive cash flows. I have also been an owner of 3 other businesses that I started from scratch. Unless you have a unique idea for a business that currently doesn't exist I am a strong believer in buying an existing business for a number of reasons.

1. You are mitigating the risk because you will take over a business with an established track record and one that already has customers.
2. You will be buying a business where the furniture, fixtures, and equipment are usually heavily discounted versus buying new.
3. You will have employees already in place.

Even with franchises I recommend buying a franchise resale to reduce your risk.

With any business sale you must due proper due diligence and verify all financial records and other aspects of the operation. In the majority of business sales the owner will stay on for a reasonable transition period.

Please feel free to contact me with any questions.

Howard Greenberg

Hi Howard, you raise some good points, but you assume that a potential owner has plenty of available capital, to enable them to purchase a business.

There must be a great number of people that wouldn't have access to financial resources, or unwilling to take on debt in order to buy into an established business.

To counter the argument, aren't there a number of potential low cost start up options, maybe car valeting, cleaning, some form of online enterprise etc. I'm not saying your wrong, but not having an immediate source of capital, shouldn't be a deterrent the right minded person to start a business?

John

If someone has little or no cash to start a business than I would agree with you. When I read Amy's post it didn't sound like she had no capital available. Using your example I would still suggest looking for someone who has started a car valeting, cleaning, etc. business and is looking to get out. Once again they will have a base of clients and a track record (one you can improve upon). In many of these situations you can put a small amount down and pay the seller over time based on continued business with their existing clients. I'm very weary of those on line no capital required business opportunities.

Howard

Amen, the internet is awash with get rich quick rubbish, preying on the vulnerable and gullible.

Great thread, shame Amy decided not to return!