How to find the right business to buy
Acquiring a business can be a daunting and frustrating experience. It’s extremely difficult to find just the “right” business and to know for certain if the seller is being totally honest and forthright. It can be equally challenging to evaluate the numbers and determine if the financial information provided by the seller is both complete and accurate.
To maximize the probability of finding the right business for the right price, it’s crucial that you partner with a professional who can help you identify, analyze and negotiate a business transaction that fits your needs and goals.
Here are some of the criteria that buyers must scrutinize before acquiring a business:
- Accuracy of financial data provided
- Credibility of the seller
- Can the business support buyer’s lifestyle
- Management breadth and depth
- Growth potential of the business
- Industry trends
- Regional demographics
- Impact of government legislation
- Competitive factors
- Legal and environmental issues that could affect the future of the business
- Price, terms, tax and structure issues
- Financing possibilities for the business
- Review of suppliers and vendors
- Barriers to entry
- Vulnerabilities of the business
- Special attributes of the business
- Seller’s true motivations for selling
- Comfort level that the seller will do everything possible to assist the buyer during the transition
- As the buyer – what will be YOUR exit strategy?