Why Buy A Business?  Had enough of slaving away just to put money in the company coffers?  Want to be your own boss?  Want to set out to make your first million?  Buying an existing business could be right for you. 

Reasons for buying a business include: providing yourself with a job and an income - working in the business as your main or secondary employment; capital growth - buying an existing business, improving it and selling at at a profit; or building up your own business empire - buying new businesses and combining them with your existing business.

By buying an existing business you don't need to start the business from scratch: you should be buying the business infrastructure: premises, facilities, stock, supplier base, staff and customers.  You may be looking to improve the business, but it should be operating as a going concern from day one.

Business Liabilities, Responsibilities and Obligations.  As a business owner there may be various liabilities and legal obligations that are associated with the business and are included in the selling price.  Make sure that your are aware of what these are and have taken then into account when planning your finances.  Seek independent professional advice and if you are unfamiliar with the type of business, try to find someone you trust to tell you about the various aspects.

Particular issues to consider may include your responsibilities as an employer and any continuing liabilities for products and services sold by the existing or previous owners.

What to expect from a business:

• You are looking for a business that can make a profit - look for real evidence that the business and its product works and sells.  Whilst the existing business may not be performing well under its existing ownership, you need at least to have a sound foundation.

• You will buy a number of business assets and perhaps some liabilities - make sure both are properly valued before agreeing a price.

• You should be buying a customer base (covered within the term "goodwill") - make sure the customers are really associated with the business you a buying rather than its owner (or possibly a previous employee).

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