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Things to consider when buying an existing business
How much will it cost to buy an existing business?
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Complete a personal financial statement for each owner of your business. Provide a balance sheet, income statement and cash flow statement for your business. Include a five-year projection if your company seeks to include long-term goals and projections. Complete an executive summary for your business plan. Create a table of contents and an appendix for the plan.

Generate the table of contents so that it references the exact pages to where each section begins. Include supporting documents in the appendix, such as receipts, tax returns and accounts payable schedules.

Label each supporting document accordingly and organize the documents so that they are organized in the order in which they are referenced. Writing professionally since , Charmayne Smith focuses on corporate materials such as training manuals, business plans, grant applications and technical manuals.

Skip to main content. About the Author Writing professionally since , Charmayne Smith focuses on corporate materials such as training manuals, business plans, grant applications and technical manuals. Photo Credits book image by jeancliclac from Fotolia. Accessed 14 September Small Business - Chron.

Do you have specialized technical knowledge in a certain area? What do you enjoy doing? What do you dislike? Keep an open mind and list everything. Spend a good chunk of time thinking about the types of businesses you think would fit. Go talk to three successful people you trust and respect — and who know you. Bounce your ideas off of them. This is just one of many great ways to make sure your business concept is sound.

Network everywhere you go. Let people know what you are looking for. And remember, there are plenty of family business consulting services you can get for free. A broker could be a good idea.

How long have the employees been there? Are there any key employees who would be hard to replace? Why or why not?

Get them to tell you as much as possible about their experiences doing business with this firm. This is the point when your CPA really earns his keep. Get the business owner to supply historical financial statements and projected future financial statements. That goes for equipment too. Review the legal documents and contracts.

That includes articles of incorporation, leases and tax returns for the last five years. Make sure your lawyer and CPA go over these with a fine-tooth comb. They will make sure that contracts are valid and the income projections are reasonable.

They should be broken down by product or service. Get a detailed list of all liabilities too. Has the owner borrowed money against any of the assets? Have they made use of cheap sources to fund the business? Are there any pending lawsuits? As a prospective business owner you should determine the current worth of the business and its future prospects.

Franchising allows a business to operate under the name and brand of an existing business, and sell their products or services. If you think franchising could be for you, read our Franchising business topic. For advice and protection in buying a business we suggest that you seek the services of a solicitor, accountant or business adviser. To help you determine a fair price, seek advice from a solicitor, accountant or business advisor.

When starting a business, you will need to decide whether you are selling products or providing a service.

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Dec 12,  · Plan for a new business or an existing one? As you plan for the business you purchase, you start by making an important choice: business plans can be either for startup new businesses or for already-existing and ongoing business. When you buy a business from somebody else, either option is acceptable. This is a choice you make/5(4).

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But when you purchase an existing business, the "dirty work" has already been done. If the business you want to buy offers a product or a service, you can evaluate the operating history and better understand the demonstrated market.

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We would like to show you a description here but the site won’t allow us. Whenever you take out a loan to buy a business, there is a high chance that your lender will want your business assets as collateral. If you pledge your assets as collateral, the lender will likely file a UCC lien to make sure any future financing you want to get is aware of their claim to your assets.

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Jul 11,  · Expert Reviewed. How to Write a Business Plan for a Small Business. Three Parts: Preparing To Write Your Business Plan Writing Your Business Plan Finalizing Your Business Plan Community Q&A A business plan refers to a written document that comprehensively outlines what your business is, where it is going, and how it will get there%(). There can be many good reasons why buying an existing business could make good business sense. Remember though, that you will be taking on the legacy of the previous business owner. You need to be aware of every aspect of the business you're about to buy.