Seven steps to follow when buying a business

Embarking on the journey of buying a business can be both exciting and daunting. Whether you’re a seasoned entrepreneur or a first-time buyer, the process requires careful consideration and strategic planning. To help you navigate this intricate path, we’ve outlined a comprehensive roadmap consisting of seven essential steps. From the initial stages of seeking professional guidance to the finalisation of the sale, each step plays a crucial role in ensuring a successful acquisition. In this upcoming post, we’ll delve into the intricacies of these seven steps, shedding light on the significance of professional advice, meticulous research, on-site visits, financial assessment, strategic offers, negotiation finesse, and the ultimate completion of the sale. Whether you’re eyeing a small local venture or a larger enterprise, this guide will equip you with the insights you need to make informed decisions and secure a promising investment for your future.

• Get professional advice

Unless you have done this before get assistance in this field, you are about to part with your good hard-earned cash you need to make the right decision. Professional help is a must throughout the negotiation, valuation and the purchase process.

• Research

Do thorough research on the seller and their business. Get to know the business you are wanting to get involved with, find out who are their customers, look out for any reviews. Get to know the person that is selling.

• Viewing

Take the time to go and see the potential seller on their premises. Ensure you know what you are getting yourself into, ask questions plenty of questions to the seller. Gather as much information as possible beforehand and this will allow your decision making a lot easier.

• Finance

If you are having to apply for finance ensure that the business will be profitable enough to pay back your initial bank loan. Ask for the accounts and see where the business is at, and are there some contracts in place where it will guarantee the future income for this business?

• Offer

Once you have done your due diligence and you are happy that this business is a good match for you and your skills then make a formal offer to buy the business.

• Negotiate

Know what you are prepared to pay for this business and make a realistic offer but don’t play out your entire hand, leave some room for negotiation. You never know you might get it for less than you are prepared to pay for it.

• Complete the sale

Once you have agreed with the seller on a price, what’s included in the price and terms, then formalise it with a heads of Terms (HoT) and get paperwork to the solicitors.