Once you have made the decision to buy a business; when you have made your personal decisions about the kind of work you want to do, the size of the business you want to run, the location of the business you want it will be time to begin searching for that business. If you have doubts about what you want the agents or the brokers will see that in you and they won’t want to spend time and really work for you.
With more buyers than sellers in the market, the agents will prefer to work with clients that are seriously motivated to buy and who have some idea of how much money they are willing to spend. By having an idea how much you want to spend you will have a better idea of the size of the business you want to purchase. You may also consider if you are willing to use any currently property you have as collateral.
Some sources you may want to consider if you are willing to use cash, the equity you have in your home, or maybe even using some of your retirement money. You will certainly want to know how much money you can be approved for by your lender. Before you start calling agents to represent you, make sure you can answer these questions.
There are many ways to locate a business for sale. There are many websites that list existing businesses for sale and you may want to start there. If you really want things to move along a little faster, go ahead and find a broker or agent first. They are your best resource as you begin your search. They will examine your acquisition criteria, listen to what you really want, work within the perimeter you set for location and they should be prompt and very professional.
As you begin to seek out a good company or agent to assist you in your search, take the time to verify all of their information before you decide who you want to use. The agent should be doing this job full time and he should possess plenty of experience in his or her field. Do they possess any certifications to prove to you that they know what they’re doing? Most true brokers are obligated to a certain code of ethics they have agreed to follow. Don’t feel shy about asking for references; the broker or agent should be happy to provide them.
If you decide to schedule a meeting with an agent or a broker to help you with the process, you’ll want to know what kinds of questions he or she may ask you. Among them are things like your own work experience, education, and be ready to provide him or her with a financial statement. He or she will want to be sure you are ready, serious and financially able to purchase a business. You will be asked why you want to buy an existing business and what skills you already have that will assist you in running the type of business you want.
Your broker will also want to know what you feel is the most you are willing to spend to make this venture a reality. If you have a business partner, make sure you have your partner in attendance for the appointment. Make sure you are completely honest and forthcoming with your potential agent or broker and be specific with your answers to their questions.
If you choose to use a broker to assist you in your search he will also want to know, based on the criteria you provide, how far you are willing to travel, and he or she will want to have you sign a Confidentiality Agreement. This is standard and your agent cannot show you any specific information about a business’s financial records without that agreement in hand.