Is Business For Sale By Owner A Good Investment?
by Cynthia Taylor
Buying a business for sale by owner is not a decision that should be taken lightly, not only is it a huge investment in terms of money it is also a big investment of time, skills, and knowledge. While there are thousands of businesses in the offering, deciding on which one to put your money requires time and research to make a good business decision.
Do a through research; find the business you would be interested in, and all other information you need to know before signing on the dotted line.
Here are some questions you need to ask yourself before you begin your search:
Decide on the type of business do you would like to invest in?
What skills and knowledge do you have in running a successful business?
How much do you wish to invest in a business?
Who will run the business and what staff requirements are needed to make the business profitable and successful?
Once you have decided what type of business you wish to invest in, you then need investigate all aspects about the business.
What is required to run a successful business? The location of the business and what competition is already in place, it’s no use buying a business when there are 20 other similar business doing the same thing. Healthy competition is good for business but if the market it over saturated then there is very little chance of it being successful.
What legal aspects need to be dealt with, do you have sufficient knowledge to be able to complete the transaction?
Search for the sale by owner business that you are interested in, and then find out everything you can about it. Why the owner wishes to sell. Ask to see the books and study them carefully. What are the running costs, if you inherit the staff, what are their salaries, incentive bonuses, do a survey among other business owners in the local and find out what sort of reputation the business has.
Is the business run from leased premises or is the building owned by the business. If owned, check if the sale includes the building or of a lease can be negotiated. Be aware of what outstanding debts and if you inherit these debts.
Buying a sale by owner business if researched thoroughly can be a good investment and you will be richly rewarded.
