The Business Show Guide November

2013 SHOW FEATURE
WHY NOT BUY
AN EXISTING
BUSINESS?
As a visitor to The Business Show, you’re probably considering
starting your own business. But have you considered the
alternative route into business – buying an existing venture?
While not for everyone, there are many compelling advantages
to buying a going concern:
1. INCOME FROM DAY ONE
An established business, assuming it’s a successful operation,
will have a history of generating profit. So as long as the
transition goes smoothly you’ll generate income from the
outset. Compare this to starting from scratch, with start-ups
rarely breaking even until year two, three or even longer.
2. LOWER RISK
Again, this is contingent on the business’s finances, but
careful due diligence and choosing a business you are well
equipped to run puts you in a strong position to thrive.
Although the failure rate for start-ups is often overstated,
it’s widely acknowledged that more new businesses fail
within five years than succeed.
3. RAISING FINANCE
ABOUT THE SPONSOR
BusinessesForSale.com connects business buyers and sellers. With over
65,000 businesses in 130 countries worldwide, the website is the world’s
largest businesses for sale marketplace. For aspiring entrepreneurs,
BusinessesForSale.com provides a route into ownership and features
thousands of business and franchise opportunities in all sectors imaginable.
If you are looking to exit, we can help you cost-effectively market your
business and find the right buyer.
The site is also a useful business resource containing articles and guides
that will see you through the process of buying or selling. And what’s
more, we have over 15 years’ experience working with buyers, sellers and
intermediaries - helping each other achieve our goals through marketing
businesses for sale online.
There seems little prospect of credit conditions easing any
time soon and banks remain risk-averse when it comes to
untested propositions whose value is only hypothetically set
out in a business plan. An established business, by contrast,
can promise to repay the loan from revenues projected
from actual, historical profits. Seen as a safer bet, successful
existing businesses can attract finance more readily and on
more favourable terms.
4. TRAINING AND CONSULTATION
Going into business alone, for all its rewards, can be a
lonely adventure. In the formative stages you may have to
build the business alone, acting as visionary, manager,
accountant, administrator and salesperson all in one. Buy
a business, however, and the seller may agree to remain
at the company in an advisory position for a transition
period post-sale.
5. BRAND RECOGNITION
Already established in the market, your acquisition
should come with a customer base and a level of repeat
business. Inheriting brand-name recognition, it should be
easier to attract new custom than if you started a new
venture and had to convince potential customers to trust
in an untested business.
IN PARTNERSHIP
WITH
NOVEMBER 2013 THE BUSINESS SHOW | 43