Should you buy a small business from someone else?
It is not easy to start a business, especially if you have always been an employee and do not have previous experience managing a business. So one consideration is to simply buy a retirement business business instead of starting one from scratch.
Here are 10 reasons why you should
or should NOT
buy a retirement business from someone else.
Reasons to buy a retirement business:
- Basic inventory, fixtures, furniture, and equipment are included.
- There are already existing customers.
- Profits start flowing immediately.
- There are relationships with suppliers.
- You get a proven system for success and know-how.
On the other hand there are reasons why you should not buy a retirement business.
- You probably will pay more to buy an existing business.
- There might be hidden liabilities.
- The company or industry might be failing.
- The business might have a poor reputation.
- The financial figures might not be correct.
An alternative to buy a retirement business is
Buy the assets and not the entire company
You can just buy the equipment, fixtures, inventory, receivables, and customer lists instead of buying the entire company. After all, you don’t really want to be stuck with paying bills and the assets are the most valuable part of a company. It is easier to discover the value of assets than to determine what the liabilities are.
If you buy just the assets, than you will not be responsible for these liabilities:
- Bank loans that must be paid
- Contracts already agreed upon
- Past due rent or leases
- Un paid employee and their claims
- Unpaid suppliers
- Unpaid taxes
You can even just buy the company name too if that is important to you.
Check out this link for more ideas. Hundreds of Retirement Business Ideas.
For more information check out my books