Why You Should Pick an Already Established Business to Buy

Starting a business can be a grueling experience. Startups are very demanding and it often can be an easier and more profitable opportunity to buy a business that is up for sale. This move saves you the hassle of having to come up with an idea, go through the legal process of registration, marketing and making the business grow from scratch. However, there are pros and cons you need to consider when buying an established business. Read on.

Buying an established business

Advantages of Buying a Business

  • Getting financing to buy an already existing business is easier than getting financing for a startup. This is attributed to the fact that an already set up business has already passed through its infancy stage and is already growing.
  • The whole idea is considered less risky. The trick here is to buy a business that has registered profits and is also well- managed. With all these put into consideration, the said business must further be bought at a reasonable price for the buyer to fully reap the full benefits.
  • You are assured of immediate cash flow. You don’t need to deal with all the ‘reds’ in your cash flow statement. Also, you don’t need to mull over how to get to break-even point faster. Your job is to grow the already healthy cash flow.
  • You do not have to start from scratch in getting customers, stock, and employees since they are already part of the business. Remember you have to work hard to maintain them.

Disadvantages of Buying a Business

  • Buying an already existing business is expensive in comparison to a startup. This is simply because the person selling it has already put resources like time and money into it, hence it already has a reputation. For that matter, the person will most certainly sell the goodwill of the business.
  • A business might need a new face and a rebrand based on the challenges it was facing before it was sold.
  • Some business on sale might be underperforming, hence they need a lot of reinvesting for them to pick up and become profitable.

Things to Look Out for Before Buying a Business

  1. Have a goal: When you know what you want, it will be very easy to find what you are looking for. It is actually as easy as it sounds. Before you venture out looking for a business to buy, have an idea of what you are exactly looking for. This will save you a lot of time.
  2. Brokers: It is vital to note that if you are using brokers, do not pay them until the end of the transaction. As a buyer, make sure you are satisfied that whatever you get is what your money is worth.
  3. Time: Always look out for the best time to buy a business for sale. Do not rush into buying a business with incomplete books since there will be gaps that probably will value the business too high while it should have been sold for a lower price. Therefore, you may not end up getting value for your money.

Searching for business for sale

Ways of Finding a Business That is For Sale

  1. Brokers: There are many online companies that deal with in the business of selling businesses. They have the know-how and expertise to know what is good in the market and how much it goes for. They also offer guidance to buyers and they also resolve issues arising from transactions.
  2. Directly from people you know: You might hear from people around you or people your friends know of someone selling their business. I would strongly advise on this mode since it has an assurance considering that you might know what the business is all about and what its returns are. This is vital when you are buying a business because you are not in the dark about that particular business.
  3. Online: In this day and age, one of the most sought-after places is the internet. You can be assured most people looking to buy a business will use the internet as their first stop shop over any other medium. With this mode, you can find a variety of options, and will be able to find a business that fits your requirements.
  4. Auction: In today’s business world, there are sites created specifically for auctioning of businesses that have the intention of being sold. The sites work in such a way that a buyer bids and the highest bidder gets to buy the business being auctioned.


In conclusion, before you decide to buy an already existing business, you need to look at the upsides and downsides. This will help you decide which type of business is better and less hectic for you. You also need to check on things with the specific before you make the decision to buy to stay focused on what you want and decide what you do not want. Because, at the end of the day, you must have a business that gives you value for your money and has great returns.