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Buying An Existing Small Business

Great, you've made the decision that you want to be a small business owner. Now you have to decide to either buy an existing small business or set up a small business from scratch. If you decide to buy an existing small business don't be lead into a comfort zone that past performance in the business is going to indicate future performance, especially in today's economy.

Some of the pros about buying an existing small business is that you might see changes that could be made to the business that would improve the performance and profitability of the business. The existing business might already have a strong return clientele that you can capitalize on.

One of the small businesses that we purchased was a motel in western Wyoming. When we purchased the motel it had a good return clientele. We made a few changes and increased that return customer base which translated to more revenue without having to spend any more money on advertising. Another way to increase your profit margin is to shop around for more affordable suppliers. The motel we purchased had eight rooms so we contacted some of the other small motels in the area and asked if they wanted to purchase items together from suppliers which cut costs for each of us without compromising quality.

My recommendation to you is that if you want to buy an existing small business, do your research. Ask questions over and over again until you have enough information to make an informed decision. If you don't feel comfortable evaluating the business on your own, hire a small business consultant to assist you. You will also want to have an account and a lawyer review any documentation prior to buying an existing small business.