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3 Common Mistakes To Avoid When Buying A Business

Have you been contemplating buying a business lately? There are lots of opportunities available in Minnesota right now. The advantages of becoming a business owner are innumerable. Here are just a few:

  • Being your own boss
  • Gain independence to make your own decisions regarding your future
  • Live and work in your passion

All too frequently, however, we've seen budding entrepreneurs miss out on their dream opportunity because they hesitated. It's a common mistake to avoid when buying a business. To help you work through some sources of hesitation, we’ve prepared this guide.

1. Self-Doubt

If this is your first venture into the world of entrepreneurship, it's understandable to question whether you have what it takes to be a successful business owner. But if you look back on prior work experience and previous responsibilities, you'll probably find that you've already demonstrated many of the skills required for becoming an entrepreneur.3 COMMON MISTAKES TO AVOID WHEN BUYING A BUSINESS

It's also important to remember that you don't need to know everything about every aspect of running a business. Maybe accounting and bookkeeping aren't your strength, but you can hire someone with that expertise. It's not reasonable to expect that you, as the business owner, would be an expert in every area of business.

Additionally, the advantage of buying a business that's been around for a while is that the systems and departments necessary for it to operate are already in place. You're not building from the ground up, and you can learn from the errors and missteps that the previous owners may have made along the way.

We have found that what most successful business owners have in common is a drive to be successful and a willingness to learn and adapt

2. Waiting for Everything to Be Just Right

One of the most common mistakes when buying a business is waiting for certain conditions to be perfect. Sure, if you look hard enough you can always find something that suggests that this time isn't quite right, but the reality is that there may never be a time that’s absolutely perfect and if you wait for that time to come, the business you've been dreaming about may slip through your fingers.

The best thing to do is to get as ready as possible so that when the opportunity arises, you can jump on it and deal with whatever isn't 100% optimal.

3. Financing for Buying a Business

You may be thinking that you can't afford to buy a business right now. That may not be true. There are many financing options available that may be right for you.

  • A bank or SBA loan: while the criteria to qualify for a loan can be stringent; it can be very beneficial. The SBA can guarantee up to 85% of the loan, depending on the amount borrowed and their terms are often more manageable.
  • Seller financing: in some instances, a seller will provide a loan covering between 30 and 60% of the purchase price. When seller financing is in place, banks and other lenders tend to view financing such purchases more favorably.
  • Rollover for business startups: you may be able to tap into your retirement savings without paying withdrawal fees or income taxes. In order to be eligible, you should have at least $50,000 in a traditional IRA, a 401(k), or another eligible retirement account. The process can be complex, so you may want to hire an independent company to provide some professional assistance.

You can consider other forms of financing such as personal loans, home equity loans, or borrowing from family or friends also.

There may never be a better time to pursue your dream of owning a business. Don't let hesitation rob you of the ideal opportunity. Visit our current listings to discover a wide range of businesses that are for sale now in Minnesota.

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Our Sellers except us to achieve the highest and best offer for their business while taking the least amount of their time away from it as possible. That is because the absolute best use of their time is to continue to run and grow the company.  If revenue or profits begin to decline, buyers will walk away or decrease their offer. Transworld's philosophy can be summed up in a ten step, how-to strategy that culminates with the sale of a company. This proven method has been used to sell hundreds of businesses.  Here are the steps. Step1 Comprehensive Business Analysis and Feedback As your business broker, the first thing in our how-to strategy is to analyze your operation, finances, market potential and industry trends. We take that information and advise you on steps to prepare your business for sale, and  generate a business profile that represents your company in the most attractive way possible. Step2 Sale Structure We identify the best possible price range to sell your company. This is based on solid facts, the condition of the market, projected growth, sales potential and the sale of similar businesses within your industry. Transworld’s experts apply sophisticated, time-proven valuation techniques to ensure that your price is appropriate for the current market condition. The price must not be too high or too low. Yet, it must represent an attractive investment potential for the buyer. Step3 Confidentially Network The Business For Sale During the selling process, we utilize the latest technology to present your company to other business brokers and strategic buyers all over the world. This greatly multiplies the effort in your favor. With Transworld Business Advisors, you have literally thousands of industry professionals confidentially representing your company to buyers.   Step4 Confidentially Advertise To Buyers Our aggressive marketing program ensures your confidentiality and provides maximum exposure for your company. Your listing is placed in various industry databases, Internet sites, and publications which are constantly updated. We spend more money in advertising and marketing for buyers than anyone else in our industry. Step5 Control The Information Flow We organize all necessary documentation and release information only as needed. We use limited information when advertising to maintain confidentiality. Buyers are pre-qualified and required to execute a confidentiality agreement before receiving any sensitive business information. Step6 Create Competition For Your Company We attract thousands of buyers, creating competition for your business. Buyers are qualified for financial ability to meet the offer, and we engage you with only the most qualified buyers. Once you meet the best of the buyers, we urge them to prepare and present all offers. We can continue to engage potential buyers on your behalf as negotiation on an offer is in process and have another interested party ready to go should a buyer change their mind. Step7 We Negotiate For You To Achieve The Best Price Appropriate negotiation is crucial to achieving your best price and terms. We have the expertise to establish sound and resourceful negotiating techniques on your behalf. Transworld has trained all of its agents in the art of negotiating through curriculum that we have created specifically for our industry. Never negotiate without planning, expertise, or from a position of weakness. Step8 We Provide Exceptional Support To You Through The Due Diligence Process We take pride in our exceptional service. Only half of the job is finding the right buyer who will pay your price and meet your terms. The other half is getting that buyer to the closing table. We quarterback the deal, work with the accountants, lawyers, banks, landlords, and other third parties that could jeopardize the success of the transaction. We realize that you depend on us to guide you through the sale of your business. We make the transition simple and easy for you. We know when an opportunity for you may arise and are always there to take advantage of it. We also know when someone is trying to kill your deal or is being unreasonable and how to handle those situations. Step9 We Are There From Beginning To The Closing We help manage all administrative procedures, licenses, inventory counts and lease assignments that may be required. Transworld works closely with your advisors to ensure a smooth transition. Using the latest technology, we strive to be ready to work on your behalf to get the deal done! Step10 We Are There For The Transitional Phase And Beyond! Because we are in the business community, you may want to consult us from time to time after the sale. We will provide you with the assistance after closing. Transworld will always remain in your corner! Schedule Consultation Now

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