Introduction to buying a business

The key to a successful business purchase is understanding the process and knowing what to expect. Going into business for yourself is a big step, one that can be full of apprehension and even fear. Almost 90 percent of all those who purchase a small business have never owned a business. Most of them bought a business that was different in size or category to what they had been looking for. These business buyers had the opportunity to explore the marketplace and subsequently found a business more to their liking.

As you begin your search for a business, keep in mind that running your own business is more than a job; it is a lifestyle change. In most cases, it is a very big lifestyle change. Usually, you will be making all of the decisions - and, as the expression says, "you will be jack of all trades and chief bottle washer." In other words, you will be responsible for all of the duties from managing the business to, in many cases, actually doing the work. Most buyers are looking for the following in considering the purchase of a business:

  • A source of income
  • Independence
  • Income for other members of the family
  • A way of increasing assets
  • Personal interest and Growth (passion & need for a challenge)
  • Tax advantages
  • A way of combining home and income
  • The opportunity to work with one’s partner
  • High return on investments
  • Higher market share or strategic purchase

Although buying an operating business is filled with many potential pitfalls, it is still one of the best ways for a beginner to get into business. There is a proven track record, an existing customer base, a well known name, location, marketing and sales strategy, etc., etc. If you buy the business properly, without overpaying and not taking on any fatal skeletons in the closet, you will have your instant piece of the Australian dream, to be your own boss and to control your own financial destiny. Get all of the information you can to educate yourself about what to look for and what to look out for. Study the particular business that you are interested in and don't let anyone push you into buying. Tens of thousands of successful business sales take place every year and the key to a successful transaction is information and knowledge on the part of the buyer.