Yes! As an entrepreneur, you may romanticize the idea of being your own boss. The question is, how do you get there? The first thought is often starting your own business. Although that has numerous advantages, starting from scratch understandably comes with challenges. It is important to note that being an entrepreneur is not limited to starting a business from the floor up, in fact, there are several advantages to buying an existing business.
For the most part, buying a business is considered less risky merely because it is already established. An established business has a vendor and supplier list, a customer base, and an entire trained staff already in place. There benefits of acquiring a company with a good financial history and immediate cash flow. With customer loyalty, there is goodwill –and is likely one of the most important and incredibly valuable intangible assets when you buy an existing business. Meanwhile, a new start-up business must build the market for its goods and services, create a following, develop a financial history, etc., all while trying to create some cash flow.
An existing business may not only have a storefront but probably also comes with equipment and inventory – which can be a major upfront investment. Although you may think this is reflected in the listing price, it is important to note that the previous owner already had seasons of trial and error to establish which equipment worked best and which inventory is most popular among its customers. This information is priceless as it will save you time and money.
Although every investment comes with ups and downs, purchasing a business is a good idea. This is especially true for someone who wants to invest and see a return quickly, rather than someone with the time, patience, and energy to dream up something new.
If you are thinking about buying a business, Transworld Business Advisors has an experienced team of business brokers ready to help you find the right business to buy. If you have not settled on a specific industry our brokers can discuss the details of each with you as you narrow down your options.