On August 3, 2010, my blog discussed the seller’s view in a business-for-sale transaction. But what about the buyer, doesn’t she have perspective?
Of course. Everything has different perspectives and the buyer is no exception. She should be considering this:
1) Know the business and don’t buy it without great comfort that it is as it is presented, where you are comfortable in knowing you can take/expand or enhance it, and that the price you are to pay supports the former, if not the later. Use professionals to help you where you are less comfortable in the evaluation.
2) Pay the fair price at the fair financing terms. It is not unusual to ask the seller to support a share (at least) of financing.
3) Expect that you will have to present a solid net worth statement and credit report that demonstrates your ability to pay the owner in the circumstance of business failure.
4) Secure the proper training and relationship with the seller that assures their continued willingness to reasonably answer questions beyond the initial training period.
5) Routinely track your performance, correct and seek professional support as necessary.
6) Pay as required.
If your performance is not as it should be and you can demonstrate that you have done everything correctly you will be in a much better position to weather economic downturns and seek support in the direst of circumstances.
Buyers, I know sellers, ones still have a claim through financing of a business, who have in the most dire situations
- moved in to take over businesses,
- restructure the financing to help the otherwise well-performing new owner, and
- elected to allow the business to fail.
Find other buyer tips at: https://dakinbusinessgroup.com/buy-a-business