BUYING A BUSINESS
What type of business should I buy? What should I look for?
Obviously you want to consider only those businesses that you would feel comfortable owning and operating. You also want to consider those businesses that you can afford with the cash you have available vs those you would need to finance as there is greater risk in taking on debt. Additionally, the business you buy must be able to provide you with enough income, after making payments on the purchase, to cover your expenses. Finally, one of the most important questions is, how are your unique qualifications, experiences, connections, and abilities going to improve the business, make it more productive, and ultimately more profitable?
Should I incorporate my business?
If you are thinking of incorporating your business after an asset purchase, there are a number of business, legal and tax considerations to consider. The general answer is that you should incorporate and choose a form that avoids double taxation at the corporate level such as a sub-chapter S corporation or an LLC.
What is a business plan? How do I prepare one?
A business plan is a written document that describes all aspects of your business or your proposed venture. It includes information about you, your product or service, your customers and competition, your marketing strategy, your management team and your finances. Basically, it is a map of your estimated business future and a demonstration that you have researched this business/industry and developed a plan to guide you. Bill can help walk you through the process of developing a business plan that will help secure private financing or an SBA loan.
How are businesses priced?
Most sellers have some idea about what they feel their business should sell for and this is certainly taken into consideration. However, the business consultant is familiar with market considerations and, by reviewing the financial records of the business, can make a recommendation of what he or she feels is the likely market value. The more cash demanded by the seller, the lower the selling price; the smaller the cash requirements of the seller, the higher the price. Many business sales are seller-financed, the down payment and terms of the sale are very important. In many cases, how the sale of the business is structured is more important than the actual selling price of the business.
What financing programs are available to help me start or expand my business?
Over the years Bill has developed a wide network of connections including financing entities and he will be able to find and connect you with the best financing option for your situation. Additionally, for a listing of some general information regarding funding programs, see the SBA website, www.sba.gov