Why Buy a Business Instead of Starting My Own?
Oct. 12, 2014
For most individuals, the dream of forming and running a successful business from the ground up is a life-long dream.
However, just like many dreams, it can be immensely difficult, even impossible, to accomplish.
In business, as in many things, it is often much, much easier to come in after all the hard ground work has been done and merely take over the reins. We are talking here, of course, about buying a new business rather than starting your own.
Here are a few benefits to existing businesses that people don’t often think about:
Inventory and equipment – A lot more equipment goes into starting a business than you might think. There are computers, desks, chairs, tables, TVs, storage racks, decorations, kitchen equipment, production machinery, etc. A business already having the equipment it needs is a massive benefit. Inventory is crucial as well; not only having the inventory itself, but having established chains of procuring more inventory. Relationships like that can take a lot of work to build up for a brand new business.
Location – Finding a good location is never easy. It is one of the main reasons that many new businesses fail. If you have a storefront, or any building frequented by customers, having a good location can be one of the best decisions you make.
Employees and customers – Establishing relationships as a new business is never easy. Whether it be acquiring good, skilled employees, or forming and growing a good customer base, brand new startups are often looked at with a degree of skepticism. Good employees and good customers in a relatively new business are worth their weight in gold.
And last, but certainly not least:
History – Individuals getting into forming their own company often have false expectations of how much money they will be making. It is not uncommon for startups to not make any meaningful profits until their second year. It’s even fairly common for startups to fail in the first year. If a business you’re looking at has a track record of financial statements and tax returns for you and your attorney to look at, the decision to buy can quickly become a no-brainer.
If you ever have questions about buying or selling a business, get in touch with a skilled business attorney today. They know the markets, and can help you realize your dreams.