Previously we discussed some of the reasons behind the statistic that 9 out of 10 people who seek to buy a business will fail. Purchasing a business is a complicated process with many factors that must be carefully considered. Most people, when making important decisions, go to their friends and family members for advice. However, when it comes to purchasing a business, the people who care about you will likely not be able to help you much. There are reasons why friends and family shouldn’t be your advisors here.
They don’t know enough about buying a business – The vast majority of people won’t build or buy a business in their lifetimes. This is not a moral flaw, and it doesn’t mean that your friends and family aren’t savvy people. They simply lack the experience that would help in this situation. They don’t know how to tell if a business is viable and financially sound or if you and the company are a good match in terms of leadership.
They worry about you taking a risk – Too many of your friends and family will try to persuade you not to buy (or start) a business because the outcome is not predetermined. They won’t want you to lose money and suffer financial difficulties, and they won’t know enough about either the businesses you consider or the process to feel comfortable with your decision making. This makes them more nervous and negative than an objective person could be. Instead of focusing on the potential for success and profit, they will try to dissuade you from realizing your goal.
First time business buyers will often have a limited amount of capital to invest, and they cannot afford to spend it on high priced consultants. Still, they need the advice of a broker MORE than buyers who are familiar with the process and have bought, sold, and owned businesses before.
It’s crucial that they do their homework ahead of time and carefully consider what kinds of businesses would fit with their skills and experience.
If you are seeking to buy a business, the advisors at Calder Capital would be happy to meet with you and talk about your situation and your goals. We have a proven track record of bringing buyers and sellers together to make successful business transactions happen in ways that benefit both buyers and sellers.
If you are looking to make your dream of owning a business a reality, make sure to involve an experienced advisor who can tell you what to look for, what to avoid, and what to expect in the process.