Are You Really Ready To Buy A Business?
Maybe you've always wanted to own your own business. It's been your "American Dream" for as long as you can remember. Or maybe you're looking at it now as a viable alternative to finding another position now that you've been downsized, right-sized, reengineered or unassigned... A way of controlling your own destiny and your own earnings.
Regardless of how you've come to the decision that you want to buy your own business, there are a number of factors that you need to consider.
First, analyze yourself and what you bring to the table.
Do you have any management experience? A background in finance? What about sales and negotiations? Or production? Are you a people person or do you prefer to work behind the scenes? Are you good at delegating? How's your time-management skills? Do you have specific technical skills that you want to showcase? And how are you at juggling? When you own a business, you're going to find yourself wearing many hats...
What's important at this stage is that you're realistic about what you can and cannot do. And that you start planning seriously about how you're going to deal with those areas that aren't your key strengths.
Second, are you really ready for the amount of time and work involved in running your own business?
What work you say? It's already an ongoing business. It's not as if I'm starting from scratch in building the business. Yes, that's true. But unless you plan on being a "silent partner" and buying a business that has a complete management team in place, then you need to learn the particulars of that business. That's going to take time -- and work. And then if you decide that you want to grow your new business beyond the stage that it's at now, then that's going to take more time -- and more work.
The point is this: be realistic about what it's going to take to own your own business. Dreams are fine; it's reality that you're going to be living in every day.
Third, what are your financial assets?
Do you have enough cash available to buy a business? Will you need to take out a mortgage on your home or are you going to tap into your 401k or IRA accounts? And what about your everyday living expenses? How much income are you going to need to generate from that new business in order to support your lifestyle? And what about your retirement needs?
Fourth, what type of return do you want on your investment in your new business?
Are you looking for an income replacement from your previous job? Moderate growth or a huge return? Do you have visions of becoming a millionaire? Or a billionaire? On one hand, it's all up to you as the owner of the company. On the other hand, you have to know what you want to achieve so that you can buy the right business in the first place that's going to give you your desired return on investment.
A professional business broker can be invaluable to you both in helping you determine how much you can afford for a business but also in determining what exactly is the right type of business for you.
How To Show Your Business Broker AND The Seller That You're A Serious Buyer
When you're serious about buying the right business for your needs, call Lou Pereira at 603.890.6628 or contact us directly via e-mail.