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Buy A Small Business - How to Buy a Small Business

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Chances are you’re interested in buying a small business, and you aren’t too sure how to go about it. It would seem simple to buy a small business, but in reality, many people haven’t a clue as to where to start with it. Buying a small business is very different from starting up a brand new one because the current, running business already has a reputation, has made sales, etc. Since you’ve decided to buy a small business over starting up your own, you’ve made a conscious decision because this means you can research the business, save on expensive startup costs, etc.

You might be in the position where you have a particular business in mind that you’d like to buy. If you don’t, you can check local listings or even search online in directories that advertise businesses for sale. Either way, once you’ve found one, you’ll want to meet with the owner and go over the financial end of things. Firstly, you’ll want to ask the owner why he/she is choosing to sell his/her small business. You don’t want to wait too long to ask this or find out for yourself. Get the direct questions out of the way before proceeding at all. In addition to this, you might want to ask how much the business brings in a year on average. What are the typical business expenses? How’s the company’s credit? You’ll also want to get an official credit report to confirm this. It would also be a good idea to review all legal documents that the small business is involved in. It would also be a good idea to consult a financial adviser if you’re feeling unconfident.

When planning to buy a small business, you might want to contact a business consultant to oversee the total purchase price. They will usually be very quick to let you know whether or not the asking price is worth it or not. You can even talk with the owner about financing the business in a down payment as well as monthly payments. Financing can provide more flexibility to you with the maintaining of your new business.

Just before purchasing the small business, you could suggest that the owner stick around for awhile to help you settle into your new business once you’ve purchased it. Whether or not the owner stays will be a definite display of character to you. If he/she isn’t crazy about giving you some initial help with your new business, this could be somewhat of a red flag. Keep in contact with the owner for a good while once you’ve made the purchase so that he/she can help iron out any kinks that might rise up.

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