6 Important Things to Consider When Buying a Business in Bedford, TX
If you dream of becoming an entrepreneur, but you would rather not risk starting from scratch – or you don’t have any new business idea that is worth starting – you should buy a business in Bedford, TX. While this may involve a lot of costs, it is also less risky as compared to starting a new business.
However, you should take due diligence when you buy a business in Bedford, TX. You should make sure that you pay the right price for a promising business that can offer you a high return on investment. Here are 6 important tips that can help you in making the best decision when you decide to buy a business in Bedford, TX.
1. Select the Right Business
You should look for a business you are passionate about and understand. Find out about the industries that best match your aptitude, skills, and experience. You are more likely to be successful in running a business with which you are familiar. This will ensure that you don’t screw up a successful business, and end up losing your money and reputation.
Moreover, you should consider the size of business in terms of locations, sales, and the number of employees. You should also find out the locations where you want the business to be located. Make sure that the cost of doing a business in the location including taxes and wages is not high.
2. Look at the Right Places
You should start your search by looking at the classified section under ‘Business for Sale’ or ‘Business Opportunities’ in your local newspaper. You can also publish your own ad in the ‘Want to Buy’ section of the newspaper describing the kind of business that you are looking for.
Also, keep in mind that not all business owners that want to sell a business post ads in the newspapers. That’s why when you decide to buy a business in Bedford, TX, you should talk to local business owners in the area and the industry that you are interested in. Some of the business owners might not have put an ad in the newspaper, but will consider selling if you made them an offer. You are more likely to know about businesses that might be profitable prospects if you put your business contacts and networking abilities to use.
3. Investigate about the Business Reputation
Once you have identified the needs and located the best business, you should next assess the strength and the reputation of the business. Consider talking to existing suppliers, vendors, and customers about the services and standing in the community.
Also, before you buy a business in Bedford, TX, you should visit the Better Business Bureau (BBB) website to know about the reputation of the business. A business that is accredited and ranked favorably by the BBB meets the criteria of providing exceptional customer service. A business that is in good standing with the customers will be more likely to generate high revenues.
4. Assess the Business Value
Assessing the business value is essential before you buy a business in Bedford, TX. If the preliminary research shows that business has a good standing among the customers, you should examine the financial statements and assess the potential returns on investment.
Never buy a business in Bedford, TX without assessing the fair market value of the business. The price of the business should be either equal or preferably lower than the market value, but never higher.
The fair market value should be determined by looking at such factors as the financial health of the business, earnings history, intangible assets, and most importantly, its growth potential. Look at the financial statements to get an idea of the anticipated returns. You should look at past three year’s income statement, balance sheet, cash flow statement, and tax returns to assess the business’s health.
Investigating the financial documents before you buy a business in Bedford, TX is important as it will spotlight any problems with the business. The information will help you in projecting future returns of the business. You can use the financial information to know about the fair market value of the business.
5. Contact the Right Professional
In order to buy a business in Bedford, TX at the best price and in the quickest time possible, you should consider contacting a professional broker. The broker can help in locating and negotiating for the best business deals. The cost of hiring a broker is often worth it, especially for first-time buyers.
A professional business broker can help you in different ways. You will discover industries that best match your skills and knowledge. The broker will prescreen the businesses and pinpoint the best ones. You will know about the good as well as the bad businesses. Also, the broker will assist you in preparing important paper works from permits and licenses to escrow and financing. In addition, the broker will find the most efficient ways to cut through the red tape that can save you time in acquiring the business.
Lastly, the broker will help you during the negotiating process. Acting on your behalf, the broker will try to get the best possible price for the business.
6. Assemble an Acquisition Team
Whether you do it alone or use the services of a broker, you should assemble an acquisition team to ensure that the buying process goes smoothly. The team should consist of an accountant, a tax advisor, and an attorney who will help you in reviewing all the documents regarding the business. Getting the help of the professionals is not just optional, but an essential activity when you purchase a business in Belford, TX.
In the end, you should conduct a thorough investigation and research before you purchase a business. Remember, that the corporate world is tough. If you don’t buy the right business at the right price, you will end up losing all your hard-earned money. To avoid holding a lemon, it’s essential that you should play your cards well and get the help of a professional.
For more information on how to buy a business in Bedford, TX, you should contact Kirksey Business Brokers.