Whether your idea for a business is original or not, there’s a strong possibility that a similar business exists that’s up for sale. Buying a business as opposed to starting one from scratch is an excellent idea if you want to get your business up and running sooner and reduce your chances of failure and unforeseen losses.
A Head Start
Starting a business from scratch takes time and effort; you need to organize the infrastructure of the business both online and offline; you also have to find staff and customers and take care of the legal side of things. Much of this is done for you when you buy a business.
Buying a business – even one that’s a going concern – provides you with all the infrastructure you need to get started right away. Under the previous management, the business might not have done so well, but you can get started with a new vision right away.
Staff and Knowledge
Of course, there are advantages to hiring your own staff for a new business venture. New staff comes as a blank slate, and you can train them in your organization’s specific processes and expectations – but when you buy a business, you already have staff with industry-specific knowledge in place.
The staff that comes with a bough business are a significant advantage to you. These people are already trained, so you cut down on costs; furthermore, they have a useful idea of what is required within the business to make it successful going forward.
Access to Customers
As with staff, customers and clients can be hard to win for a new business – you have to invest in advertising and promote the business extensively, but with a bought business, you already have a customer and client base to work with, making it easier to get started.
But don’t be under any illusions; just because you have an existing customer base doesn’t mean your new business will be immediately successful; on the contrary, there is likely a lot of work to be done to convince new and existing customers that your ownership is suitable.
Limited Research
There are many formalities to organize when starting a new business: the tax system and legal procedures, legal systems and obligations, and local government rules and regulations. It takes time and patience to research and legitimize everything. Alternatively, you need to hire a specialist.
When you buy a business, it usually has all of this worked out already, and if it isn’t, there usually is someone in the company who understands the legal side of things and can help to give you a head start. This is especially important if your business is subject to many regulations – like catering, for instance.
Market Position
New companies start from scratch and need to build a reputation; this can be advantageous if you want to grow in a particular direction; however, this will still require a lot of investment and marketing. Therefore, it can be extremely helpful to have a market position established already.
Most of the time, a bought business from trending businesses for sale locations will have some form of marketing position established, even if it’s one that requires some improvements. Even so, you already have a direct market position that you can begin to develop.
Certificates and Licenses
No one buys a business because it has existing certificates and licenses, but even so, having these items in place makes your task as a new owner a little bit easier. In addition, when your business has established certificates and licenses, it frees up time to focus on other business essentials.
But certificates and licenses don’t only exist for the business; your staff might also require certification, which can be expensive and time-consuming when you need to invest yourself, but when your staff is already certified, you can spend less time on the basics and more time making the business run smoothly.
Limited Risk
Buying a business is less risky than starting one from scratch; additionally, it increases your chances of the business becoming successful. When you start a business from scratch, you set everything up yourself, and there’s no way to tell what direction it’s going to take. This is not the case with a bought business.
When you buy a business, you can assess its infrastructure in real-time. You can look at the books and see where things can be improved, and you can check over the business for anything that you consider a risky practice. In short, you can mitigate your risks of failure by assessing the business before you buy it. Some successful entrepreneurs also recommend talking to an attorney about creating a new business entity (like a corporation or limited liability company) for the sake of minimizing liabilities that may come with the business. Just be sure to do your research and talk to a professional.
