6 Things to Consider When Reviewing a Possible Business Acquisition
Last month in our newsletter we mentioned things you might want to focus on when deciding what kind of business to buy and where to look.
When you find something interesting here are several things to focus on as you review it:
- Are there good financial records? Small businesses will not usually have audited or even compiled statements. QuickBooks or similar P&L’s supported by tax returns should be available. Sellers may not let you see the whole picture until due diligence after you make an acceptable offer, but verify the financial picture before closing.
- If a facility, is it licensed for the activity involved, like for a restaurant how many seats licensed, or a store does it comply with zoning regulations?
- Check with the Secretary of State to make sure the business is registered. If not make sure the trade name is available for your use. (If so it can be transferred after closing).
- How complex is the business and how long will it take you to learn the basics. Will the owner agree to stay that long, either as negotiated in the sale price or for a reasonable salary?
- If you don’t have specific industry experience will you be able to convince a banker that you have the knowledge to run the business?
- Can you see yourself running the business full time?
Obviously there are a lot of concerns to deal with that will vary based on the business involved, and we try to help buyers work through the important concerns as they approach any business we represent. If you have questions, feel free to drop us a
or give us a call.
Below, we follow up on one of our recent sales and share new and revised listings. Visit our
to see our complete list of offerings.
Leon Parker, President