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Page 2
How To Investigate Any Business Opportunity
1. Making The Decision To Buy Or To Sell A Business
The Decision to Sell
Business owners choose to sell for a variety of reasons: 
·
   
Retirement. 
·
   
Partnership dispute. 
·
   
Diminished interest in the business due to boredom or frustration. 
·
   
Illness or death of one of the principals. 
·
   
Sales and earnings have plateaued because the company lacks the working capital or manage-
ment resources to grow. 
·
   
Losing money. 
Selling a business is different than selling any other asset one owns, because a business is more than
an income earning asset. It is a lifestyle as well. Therefore, the decision to part with it can be emotional.
Personal ambitions should be weighed against economic consequences to achieve a properly balanced
decision to sell or not to sell.
It is said that timing is everything, and certainly that old axiom is true as applied to the decision to sell a
business. Intelligent business owners carefully plan out the decision to sell. They recognize that a busi-
ness should be sold only after proper preparation and not because of sudden personal frustration or a
short-term downturn in business.
The Decision to Buy
It is imperative that a potential business buyer carefully think through his motives for considering the pur-
chase of a business and his criteria in selecting one. A buyer should consider his experience - both vo-
cational and avocational - what he is good at and what he enjoys. If a buyer is interested in a business
that has a product or service that is outside his area of expertise, then he should make certain that key
employees will stay on after the change in ownership or that similar expertise can be hired.
It is equally important that a buyer identify the desired location's and the amount of money willing to be
invested. If the money to be used is not in liquid form, the buyer should assess what the realistic possi-
bilities are of obtaining the funds from outside sources. One should also decide on the size of the busi-
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