The First Questions & Options that Buyers should not overlook when Buying the Right Small Businesses.
- Does this or can this business offer the Return On Investment that you require?
A. The entrepreneur needs $400k to start or buy a business, believes he/she can earn $100k per year, and therefore will generate a 25 % return on investment. Ideally can this Right Small business last forever and produce $100k or more year after year after year?
- Will the business operate even if I am not on site?
A. Is there a Manager or Staff that are capable of Opening and Closing plus all the day to day duties? Can it be Systemised to do so?
- Can I utilise any of my skills to improve it e.g. Management, Marketing, Trade or People Skills.
A. When you take over right small businesses and the Sellers is no longer involved, how will you either replace them or take this Enterprising Small Business to the next level with your skills?
- Am I going it alone or is there structured support or advice available e.g. Franchisor – Franchisee Best Practices, committed Manager or Detailed Procedures Manual?
A. The advantage of buying a Franchise is the Data and KPI resources available, if nothing else there must be accurate Purchase, Sales and Stock turn information in the Financial records.
- Is there a need or demand for the product; is there recurring sales or a once off Impulse Purchases?
A. Is the Product or Service provided a necessity or a luxury item in high demand by the customer demographics?
- Are you falling in love with the Product, Premises or the Profit?
A. Have you always wanted one or been a raving fan of this business? This is called buying from the heart and should only be considered if all of the above meet your criteria.
Your aim should be to buy Right Small Businesses with the Goals of (1) making them into better Business and (2) eventually reselling them at a Profit.
I have in fact resold a number of businesses, with this first hand Historical Knowledge, I have found a suitable buyer quite promptly and at a higher price than their initial Investment. Need to find out more about Buying or Selling a Business contact Adrian Coyne 0418885666