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5 Things You Might Not Think to Investigate Before You Buy a Business

When looking to buy a business, you may think that you have all of the bases covered – you’ve got the funding, the business is currently successful, and the seller is cooperating with all your professional questions and concerns. But there are many factors to consider when purchasing a business. Before you jump head first into the purchase of a business, consider the following points, and ensure that your business decision won’t come back to bite you later.

1. Understand What Assets You Are Purchasing

Knowing which assets you are gaining going into the sale is a vital factor, as these assets can affect Buy-Business.jpgtaxes, and take away your liability in case the seller is being sued. You should never, ever, purchase stock in an existing company that you are buying. Rather, offer to purchase all assets of the business.

 

2. What is the Seller’s Intent After the Sale?

Before you finalize any business purchase, have a direct conversation with the seller, and get his take on his intended actions post-sale. Find out whether he plans to stay on board in the business somehow, or if he plans to completely drop-out of any responsibility or business on-goings in general. If the seller plans to stay onboard, develop a clear idea and description of their role and responsibilities so you both enter into the sale with clear expectations.

 

3. The Employees and Their Roles

If you are buying a business that has existing employees, ensure you know their plans and positions, as well. Chances are, there are a few select “key” employees that can let you know almost as much about the business as the seller themselves. Chat with the employees, get their take on the business and customer base, and have them communicate their intentions once you take ownership of the business.

 

4. Why is the Seller Selling?

Do some investigation as to why exactly a seller is getting out of the business. All sellers know their business inside and out, and a lot better than any outsider with perspective. No matter what the original stated reason as to why a seller is deciding to part with a business, cultivate a meaningful relationship with the seller for increased insight, and a general idea of what you could change once the smooth transition of ownership is complete.

 

5. What do Customers Say About the Business?

The customers are the heart of any business. Without them, there would be no revenue, growth, or business in general. There are certain questions to ask when buying a business, and chatting with customers will help you obtain many answers. Inquire as to what they love about the business and any suggestions they have surrounding potential changes. Learn the customer base, and target market, well before you decide to purchase a business.

 

As an entrepreneur, the adventure into buying an existing business can be fulfilling and freeing. By asking the right questions, you’ll be able to come to a well-rounded decision as to which business is right for you. Transworld Business Advisors of Minnesota provides professionals with incredible business opportunities and we have a detailed list of Minnesota businesses for sale.

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Ten Steps To Selling Your Business

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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