Entrepreneurial Entry: Basic Q&As Before Buying a BusinessInk Well Mag September 8, 2016 0 COMMENTS
You may not know that much about business, but you are willing to try and have looked up several companies for sale. It’s worth noting, however, that the process takes more than guts to be successful. Do choose your finalists based on the questions provided.
What’s Included in the Sale? – Businesses these days don’t just include its products, staff, services, and properties. It also includes branding, promotional ads, marketing programs and other aspects that involve its identity and market value. Clarify what exactly does the sale include and the parameters that comprise the sale.
How Did You Compute for the Price? – Most companies being sold are priced against its profit margins and multiplied by three or more times. And there are also companies that are sold for less than their actual worth in the market. Before committing to buy a business, Utah Business Consultants says you should be clear on why the company is being sold for that amount to see if the price is worth it or not.
Are There Balances to Be Paid? – Most companies have accounts receivables and account payables when since most are still operational. Clarify and compute for the balances that need to be paid to the suppliers and staff, along with the taxes for the said amounts. Compare the said amounts with the current receivables just so you know you’re not buying at a loss.
Can I Speak to the Owner? – Though most sales go through business consultancy companies, it is your right as a buyer to meet the owner and ask more “personal” questions regarding the business. These may include questions such as “What are your plans after the sale?” or “What are your more personal reasons for selling” and should warrant an answer before anything is signed.
Wise decisions are normally still based on facts and figures. So, take time to analyze the information given you while considering expert advice from the professionals. And keep asking questions beyond the ones given above just so all your queries are answered before you make your final selection.