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Page 28
How To Investigate Any Business Opportunity
For Sam, the motivating factor was change. He found his sales decreasing in spite of his extra effort,
competition increasing, empty building space impossible to rent. In other words, both internal and exter-
nal factors had brought changed conditions that affected the business unfavorably.
Changed conditions should be analyzed carefully before a business owner accepts them as reasons for
selling his business. The following questions can serve as a guideline for this analysis;
1. Have changes actually occurred in my business?
2. Are the causes of the changes beyond my control?
3. Are the causes of the changes within my control?
It would be unfortunate for a owner to sell his business because of changes he could control if, by such
control, he could recapture a successful and satisfying operation. Every owner, therefore, should exam-
ine closely his motives for wanting to sell the business.
What makes an individual want to buy a business? Again, motivations will cover the whole range of hu-
man desires, from simple economic gain to social ladder climbing.
Bill's prime motivating factor was the desire to expand a special skill into a business of his own. Bill
thought he knew enough about grocery stores to handle one of his own. But he didn't. This factor of a
special skill represents one of the dominant reasons for wanting to buy a business. It is a natural motive
but, perhaps because of its natural appeal, it can be a dangerous motive.
A business must be managed. An operating skill does not always lead to managing ability. In fact, it of-
ten encourages a business owner to spend his time operating instead of managing. Planning for the fu-
ture, organizing resources, staffing the business with competent people, directing the coordination of
people and operations, controlling results - these are the functions of management. Consequently, an
individual with a skill seeking to buy a business in which to apply the skill should check his motivation by
asking questions such as the following:
How important is management ability in this business?
Occasionally, a business that is unique and very simple almost manages itself. But if the business is in a
competitive field, management ability is probably the most important requirement for success
Do I have the ability to manage successfully?
Effectiveness with people (customers and employees), eagerness to tackle difficult problems and make
decisions, and intelligence about general business operations are key ingredients in management abil-
ity.
Can I learn how to manage the business?