Why Buy a Business

Why Buy a Business

“Entrepreneurs and their small enterprises are responsible for almost all the economic growth in the United States.”
Ronald Reagan

Recent surveys show that the self-employed are happier with their jobs than those who work for someone else. There are several aspects of being self-employed that satisfy people most according to a research study. These include the ability to influence decisions, deriving “personal satisfaction” from their jobs, and the opportunity to move up. Surprisingly, over sixty percent of self-employed workers say they are completely satisfied with the security their job offers.

As to why people buy a business, one survey had the following results, in order of importance:

  1. To do my own thing, control my own destiny.
  2. Don’t want to work for someone else.
  3. Better use of my skills, ability and imagination
  4. To make money. (Note that making money is not on top of the list.)
  5. To build an asset that I can pass down to my family

 SOME ADVANTAGES OF BUYING AN EXISTING BUSINESS 

  • Actual Results Rather Than Proforma – You have the ability to gauge a business by actual day-to-day operations and do not have to work from projections that may not fit you or the area.
  • Immediate Cash Flow –You will have sales and income from the beginning through continued operation; a new start-up will have extended down time from conception to opening the doors.
  • Trained Employees in Place – You can’t beat experience for being the best teacher.
  • Established Suppliers – You can continue to use present sources while you shop the market place for better ideas.
  • Established Customers – Your customers do not have to discover you; they are already in place and have a buying pattern.
  • Existing Licenses And Permits – You are “Grandfathered” in and do not have to fight the system
  • Training By The Seller – A very important part of any business that can assure continued success. This should be a part of the offer to purchase contract.
  • Availability Of Owner Financing – This shared risk often will demonstrate the seller’s faith in the businesses. Lower Failure Rate – Because it is an existing business, there is a better chance for success over a new start-up.