Buying a Business

Unlock Your Entrepreneurial Potential: Discover the Benefits of Acquiring an Existing Business

Are you ready to embark on an exciting journey towards becoming your own boss? At VNB Business Brokers, we are here to guide you towards the perfect business that aligns with your personal and financial goals. Unlock your entrepreneurial potential today.

Do you dream of owning your own business?

Buying a business can be a complicated procedure, from finding the right one to working out all the details required for a smooth transfer of ownership.

While there is no such thing as the “perfect” business, a business broker knows the importance of finding one that fits your needs, talents, skills and lifestyle.

A business broker has many different types of businesses for you to consider and the knowledge and experience to walk you through the entire process.

Below you will find some helpful information as you consider whether buying a business is right for you.

For Business Buyers

Going into business for yourself is a big step, one that can be full of apprehension and even fear.

Almost 90 percent of all those who purchase a small business have never owned a business. Most of them bought a business that was different than what they had been looking for. These buyers had the opportunity to explore the marketplace and subsequently found a business more to their liking. In most cases, the seller financed the sale.

Most buyers are seeking to obtain the following when considering the purchase of a business:

  • Pride in the service or the product
  • Flexibility
  • Income
  • Control of own destiny
  • Recognition
  • Security
  • Privacy
  • Status
  • Customer and employee contact

As you begin your search, keep in mind that running your own business is more than a job; it is a lifestyle change. In most cases, it is a very big lifestyle change. Usually, you will be working longer hours, making all of the decisions, and, as the expression goes, “you will be the chief cook and bottle washer.” In other words, you will be doing all of the work from running the business to, in many cases, sweeping the floor and changing the light bulbs.

The bottom line

Being in business for yourself can be a daunting prospect. There are no guarantees. At some point, after all of your investigation is completed, you will still have to make that “leap of faith” that is necessary to proceed with the purchase of the business.

You will have to work hard, perhaps even “tighten your belt” a little, and perform many different jobs to be successful in your own business. But, if running your own show, making your own decisions, not having to worry about job security (remember, no one can fire you from your own business), and just being on your own are important – then owning a business is for you.

After taking this leap of faith, almost all business owners will tell you that they would never go back to being an employee.

What should you look for when considering a business to purchase?

Unfortunately, too many prospective buyers want to know the asking price first and then ask how much money they can make.

These are the wrong questions to ask initially. You need to know how much cash the seller requires as a down payment. No matter how good the numbers are, there is no point in looking at a business if the seller wants three times as much cash as you are willing to invest.

Remember, the actual amount of money a business earns is usually much more than just the bottom line. A smart approach is to get more information on the business, and even make a visit, before ruling it out or getting too involved in the numbers. It’s all part of the learning process.

One of the most common questions asked by those who have never purchased a business (which is incidentally about 90 percent of those looking to buy a business) is how do you actually buy a business. There is no right or wrong way to buy a business.

However, it is important that you get answers to all of your questions and that you have all the information necessary to make an informed decision.

Here are the steps to buying a business that over the years have become the most efficient and practical:

Insider Tips
Unless you are completely familiar with the type of business purchased, it is beneficial to include as part of the agreement that the seller will stay with you (30 days is fair, with perhaps another 30 to 60 days of telephone consultation) a sufficient length of time to teach you the business – at no charge. If you want the seller to stay longer, it may be best to offer to pay him or her a consulting fee of some type.

For Business Buyers

The next step to buying your own business is to make sure it is the right move for you and your family.

Owning one’s own business is still very much “the great American dream,” but it’s not for everybody. Here are some questions that you should ask yourself before taking the next step.

01.

Discover the Advantages of Acquiring an Existing Business


Purchasing an established business offers numerous benefits compared to starting one from scratch. Here's why buying an existing business is the right choice for you:

Instant Cash Flow: Bypass the initial struggle and generate income from day one. Acquiring an existing business grants immediate access to cash flow, allowing you to enjoy the rewards immediately.

Skilled Workforce: Avoid the challenges of recruiting and training new employees. An existing business has a knowledgeable and trained team ready to excel under your leadership.

Established Relationships: Leverage the trust and connections built by the previous owner. By acquiring an established business, you inherit reliable suppliers and credit arrangements, ensuring a smooth transition and continued operations.

Loyal Customer Base: Sidestep the uncertainties of starting from scratch. With an existing business, you gain a dedicated customer base and referral network, providing a solid foundation for growth and profitability.

Existing Licenses and Permits: Save time navigating regulatory requirements. Purchasing a business with current licenses and permits streamlines the process, allowing you to focus on managing and expanding your venture.

Seller Training: Learn the ins and outs of the business directly from the previous owner. Benefit from their expertise during a comprehensive training period, ensuring a seamless handover.

Owner Financing Options: Overcome financial barriers with seller financing options. Sellers are often willing to provide financial assistance, simplifying your acquisition journey.

Actual Performance Data: When buying an existing business, you can evaluate its performance and potential based on historical data, unlike starting a new business where decisions are driven by projections.

02.

Maximize Your Success: Crucial Considerations for Business Buyers


Before diving into the world of business ownership, consider these essential tips to maximize your chances of success:

Self-Assessment: Know your strengths, weaknesses, and financial needs to identify suitable businesses that align with your skills, interests, and objectives.

Location: Choose a strategic location that meets the needs of your target market and offers growth potential.

Track record: Evaluate the business's past performance, market share, and growth potential to ensure it aligns with your goals.

Management: Assess the quality of the management team and employee relationships to ensure a smooth transition and continued success.

Your Path to Business Ownership:
A Step-by-Step Guide

Step 1

Find Your Perfect Business

Browse our listing database and network of business acquisition opportunities to discover businesses that align with your vision and objectives.

Step 2

Sign Non-Disclosure Agreement (NDA)

Ensure the sensitive information the seller shares is kept confidential throughout the acquisition process by executing an NDA.

Step 3

Complete Buyer Profile

Provide a detailed Buyer Profile outlining your professional experience and financial capabilities. This confidential information helps us assess the fit between your requirements and potential businesses.

Step 4

Review Confidential Information Memorandum (CIM)

Access comprehensive information about the business, including financial performance, growth opportunities, and more, to make informed decisions.

Step 5

Connect with Broker

Discuss your interests and initial questions during a brief call with a business broker to determine if the opportunity aligns with your acquisition goals.

Step 6

Conference Call with Seller & Broker

Join a call with the seller and broker to learn about the business, share your interest, and discuss your background and experience, laying the groundwork for further exploration.

Step 7

Meetings & Conference Calls

Schedule an on-site tour, meet the seller, and gain deeper insights into the business's operations. Subsequent discussions address your preferences, concerns, and potential next steps.

Step 8

Submit Non-Binding Letter of Intent (LOI)

Make a conditional, non-binding offer by submitting an LOI, proof of funds, and a good faith deposit. We can assist with offer preparation, deal structuring, and contingencies.

Step 9

Perform Due Diligence

After your LOI is accepted, conduct thorough due diligence to examine various aspects of the business in detail, verifying financial information, assessing assets, and vetting other crucial elements to make a well-informed decision.

Step 10

Negotiate and Execute Purchase & Sale Agreement

Finalize and sign a purchase and sale agreement with the seller to formally accept your offer. Engage attorneys and advisors to guide you through the process.

Step 11

Coordinate Pre-Closing Items

Conduct an inventory count (if applicable) alongside the seller to ensure an accurate transfer of assets. We'll assist in coordinating pre-closing items and facilitate a smooth process.

Step 12

Closing

Congratulations, you’re now a business owner! Embrace your success and embark on a rewarding entrepreneurial journey.

Realize Your Dream of Business Ownership Today

Explore our current opportunities in more detail and take the first step towards making your dream of business ownership a reality.

Do you have other questions?

Be sure to visit Buyer FAQ for answers to the following questions.

  • Why should I buy a business rather than start one?
  • What is the real reason people go into business for themselves?
  • How are businesses priced?
  • What should I Look for?
  • What does it take to be successful?
  • What happens when I find a business I want to buy?
  • Why should I go to a business broker?
  • Do I need an attorney?
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