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4 Common Business Buying Questions Answered

Have you decided to buy a business? Although there are many aspects to consider during a business buy, understanding basic factors of purchasing a business can help you make better decisions moving forward in a business acquisition. We’ve compiled a list of some of the most commonly asked questions when it comes to buying a business:

1. How is a Businesses Selling Price Determined?

Depending on the size and level of establishment of a business, the asking price is determined by man-coffee-cup-pen.jpgcombining a business owner’s pre-tax profits, including fringe benefits such as travel and interest, and the value (with depreciation in mind) of equipment and/or vehicles. This number can then be multiplied by either two or three times, depending on the success or opportunity for growth a business contains.

Once a business owner has completed this calculation, a realtor can be contacted to evaluate the real estate value of a location. These numbers can then be taken to a professional business advisor, who can develop a business’s selling value based on this information.

2. How Do I Know I’m Getting the Best Deal Possible?

When you’ve decided to buy a business, you want to ensure that you are paying the best price possible. But the best deal doesn’t necessarily equal the lowest price. A business advisor focuses on the goals of a future business owner and helps them to develop a long-term plan based on the buyer’s needs. When purchasing a business, a buyer should attempt to find a location that fits both their goals and immediate needs, and negotiate a price from there.

3. Who Will Be Involved in the Business Purchase?

During the process of a business buy, a team of professionals from various economic sectors will be involved. These professionals will include attorneys, accountants, and the existing owners of the business being purchased. To ease the process of purchasing a business, you’ll need to be clear about your intentions, to ensure that each member of the professional team is on the same page, and are working towards optimal results. Business advisors, like our team at Transworld, can help coordinate these efforts for you.

4. How Do I Know a Business is the Right Fit for my Skillset?

Knowing the right questions to ask the right individuals is crucial for any business buy. When considering purchasing an existing business, ask the owners what criteria and skills must be met to successfully run the business. Relate their answer to your own skill-set, and work out what factors you’ll need to improve to optimally run and grow the business. If you still have questions regarding whether a business will be a good fit for you as a business owner, speak with a business advisor. They are equipped with the knowledge and insight necessary to deem an individual ready to take on specific responsibilities and to work with you to find the best fit for your skillset.

For more information on breaking down the steps towards business ownership, or to find answers to other questions you may have, download Transworld Business Advisors’ e-book, All-in-One Guide for Buying a Business.

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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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