A person looks at a computer to learn more about an idea to buy a second business

What You Need to Know to Buy a Second Business

Want to buy a second business? Many owners are making this smart move to grow and scale their current business, reach new markets, attain new capabilities, or realize other personal investment goals.

There are lots of other benefits to this strategy, too. Here are a few that might matter to you:

  • You can take control of a profit-producing business without working through the pains and trials of startup.
  • You'll gain access to a prebuilt pool of customers who know and are loyal to the business.
  • You can connect with vendors and suppliers who know the business intimately and want to continue the relationship far into the future.
  • You'll gain an experienced team of employees who are experts in the business's processes and can support you in its long-term success.
  • You'll gain the rights to a proven business concept that's already experienced the success and sustainability you'd want to create in a business.

 

As with any opportunity, there are pros and cons that you should keep in mind before diving in. This article can help you work them:

 

What should I look for in a business?

Any business you choose to pursue should align with your business’s needs or strategy or your personal investment goals. Here's what that could look like for you:

  • To give your current business a boost, you might look for entities that offer you new capabilities, capacity, or intellectual property. Or, you might focus on enterprises that could connect you with strategically important customer segments or geographic markets.
  • If you’re interested in buying a business that’s distinct from the one you own, you should consider your interests, skills, experiences, and financial goals before making a selection.

 

Once you have an idea of the industry you’d like to work in and the markets you’d like to serve, home in on the ones that have these characteristics:

Evidence of sustained profitability and operational efficiency

A sound reputation

A member of a growing or enduring industry

Adaptability to meet changes in market preferences

Meet your criteria for location, time commitments, and risk

Attainable for the amount of money you can raise
or afford to invest in the acquisition of a business.

 

Where can I find businesses to buy?

There are quite a few listing sites sellers and business brokers use to market a business. In most cases, you can view those listings for free and without signing up for a service.

 

You could also work with a fee-based, “buyer’s representative” who will help you find businesses that meet your goals, interests, and budget.

Are you interested in connecting with a broker? Click the Connect button below to get started:

 

Many business owners choose a third path. They buy businesses that aren't for sale. Usually, these owners study their target industry and look for owners who might be willing to sell. Approaching these owners directly, these buyers often arrange simple purchase deals that benefit both the buyer and seller. You can learn more about this approach in this guide:

 

Can I afford to buy a profit-generating business?

In many cases, you can acquire a business with minimal upfront investment. A small business loan, 401(k) financing, or seller financing can help you afford a larger, more successful business than you may have thought possible. Check out these options and others here:

 

How can I learn more about buying a business?

Log into your owner’s portal to research the process, study smart plays, and analyze the pros and cons of buying a second business.

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