One decision that might be the most difficult when it comes to becoming a small business owner is whether or not to buy a small business or setting up a business from scratch.
Setting up a business may look to be a more a risky proposition at the outset. You may feel the sting of the “unknowns” a bit more, but that may be a false idea, here is why. Buying an existing small business lends comfort, albeit false, because many assume past performance indicates future performance, untrue, especially today. Here are a few tips to better evaluate an ideas’ feasibility to become your next start up.
Is there competition?
If there is truly no competition in the market, why is that? Is there a viable need? Many people think starting a completely new business is the smartest foundation for setting up a business. But one could ask, ” if it doesn’t exist now, is it needed, is there a demand ?”…
What are three possible benefits your business can add to the marketplace better than any other existing business? Having more than one core concept in your small business bag of tricks is a good idea. Most successful small businesses didn’t look the same when they started. Success small business start ups need to be responsive to the needs, and requests of your customers.
New Small Business: Marketing.
Marketing a new small business in the information age is a finicky nuance. Setting up a business, a new business requires some marketing creativity. Marketing a new business can be more effective when you realise marketing is an ear, not a mouth piece. Ask questions, listen to customers, observe needs.
Setting up a new business can be a better path to success in small business because you will travel without the encumbrances that can come with buying an existing small business. Buying a small business will undoubtedly require DEBT. Not only the debt of the purchase price, but likely there will be existing debts with the business… You get those for free, they throw them in with the deal. Home business ideas will usually not tranfer debt, or the debt will be much lower on account of the lower debt requirements in the first place, but, Always Check!
Buying a small business, like setting up a business from scratch, has its own pros and cons. Many people find comfort in the fact that the business can be analysed. It will have a balance sheet, profitability statements, and processes you can actually observe and analyse. Many people who are buying a small business see changes that can be made that they presume will improve the performance and profitability of the venture.
When buying a small business you will need to look closely. Hiring an small business consultant is a good idea. Finding a small business consultant to help you evaluate a business before buying a small business will prove to be money well spent. While I have no recommendation, I do recommend spending as much time seeking a qualified small business consultant as you do searching for the right business to buy.
Before Buying a Small Business.
My favorite question, and one that could be yours: Why are they selling this business? As around in the community, contact vendors, supplier, and customers. If the current business owners are selling the business for reasons like retiring, give time other ventures, or health reasons, it is more important to do proper due diligence.
Avoid Buying a Bad Small Business.
Rarely will you see a small business for sale that has an ad like this ” Small Business For Sale” It is not profitable, its a pain in the ass and we want to cash in.
Small Business Advice.
Got small business tips related to buying a small business or setting one up? Got Questions. Please use the comments section, we love hearing from you.