Buying Tutorial

Ever daydreamed of being your own boss, calling the shots, and building something truly yours? Buying an established business can fast-track that dream, ditching the startup struggles and catapulting you into the realm of entrepreneurship. But where do you start? Don’t worry, Axon & Associates is here to be your trusty navigator on this exciting journey.

Are You Cut Out to Be Your Own Boss?

Before diving headfirst, ask yourself some key questions:

  • The Dream vs. Reality: Owning a business is more than just flexible hours and being your own boss. It’s long days, tough decisions, and constant hustle. Are you ready to roll up your sleeves and get hands-on?
  • Lifestyle Shift: Be prepared for a significant change. Owning a business often means working more, making all the calls, and wearing many hats. Is your family on board with this new chapter?
  • Motivation Matters: What’s your “why”? Do you seek pride in a product, control over your destiny, or the freedom to be your own CEO? A clear vision fuels your journey.

Going into business for yourself is a big step, one that can be full of apprehension and even fear

Individual or Corporate Buyer? Tailoring Your Approach:

Whether you’re a seasoned professional or a passionate side hustler, Axon & Associates caters to your unique needs:

For Corporations:

  • Find Your Perfect Fit: We leverage our extensive network to match you with businesses that align with your skills, interests, and budget. No more wading through endless listings.
  • Beyond the Numbers: We go deeper than just financials. We assess industry trends, growth potential, and cultural fit to ensure a business that excites and challenges you.
  • Support Every Step of the Way: From navigating the buying process to securing financing, our team is by your side, offering expert guidance and unwavering support.

For Individuals:

  • Strategic Expansion: Seeking to accelerate growth and gain a competitive edge? We identify businesses that complement your existing operations, unlocking new markets and maximizing value.
  • Seamless Integration: Our expertise ensures a smooth transition, minimizing disruption and maximizing the benefits of your acquisition.
  • Data-Driven Decisions: We leverage market research and financial analysis to provide clear insights, empowering you to make informed decisions with confidence.

What to Look For in a Business:

It’s more than just a sale price tag. Here are key considerations:

  • Track Record: A long and successful history indicates stability and customer loyalty. Look for businesses with consistent revenue and growth.
  • Reason for Selling: Understanding the seller’s motivation can reveal valuable insights. Are they retiring, expanding elsewhere, or simply ready for a change?
  • Financial Health: Scrutinize financials carefully. Look for healthy profits, manageable debt, and a clear understanding of revenue streams.
  • Market Potential: Is the industry growing or stagnant? Are there future opportunities for expansion? Consider the long-term outlook.

The Bottom Line:

Buying a business is a significant decision, but with the right guidance and support, it can be your springboard to success. Axon & Associates is your partner in this journey, providing:

We have in-depth knowledge of various industries and their nuances, helping you avoid pitfalls and find hidden gems.

We secure the best possible deal for you, protecting your interests and ensuring a win-win outcome.

We don’t just hand you the keys and walk away. We offer ongoing guidance to help you thrive in your new venture.

Owning a business is an empowering adventure, and Axon & Associates is here to make it a reality. Contact us today for a free consultation and let’s turn your entrepreneurial dream into a thriving business success story!

Unfortunately, too many prospective buyers want to know the asking price first and then ask how much money they can make

Ready to take the next step?

Visit our Buyer FAQ section for answers to common questions or get in touch with us to discuss your specific goals and aspirations!

Remember, buying a business shouldn’t be daunting. With Axon & Associates as your trusted guide, you’ll have the knowledge, confidence, and support to navigate this exciting journey and own your future.

Don’t wait. Start building your entrepreneurial legacy today!

Here are the steps to buying a business that over the years have become the most efficient and practical:

Get preliminary information on price, terms, income, cash flow, and general location. There is no point in continuing the buying process if the amount of cash necessary to buy the business is more than you are willing to invest. At this point, don’t worry about the full price. It’s important, but the key factor is the amount of cash that is necessary to buy the business. There is very little outside financing available such as banks, etc., for those who are purchasing businesses. The great majority of business purchases are financed by the seller. This is why the amount you are willing to invest is a key issue.

Also, the business has to be able to meet your basic financial needs. You can expect a business to improve under your ownership, but you also have to be able to meet your living expenses as well as meet the debt service of the business. It is also important to remember that almost all purchase prices and down payments are negotiable. In fact, businesses generally sell for about 15 percent to 25 percent less than the original asking price. There is an old adage that says, “the more cash you are willing to invest in a business purchase, the lower the full price; the less cash you are able to invest, the higher the full price.”
The longer the present owner has been in business, the more likely he or she has been successful. People don’t stay in business if they are not making money.
If the owner has been in business for six months, is 37 years old, and wants to retire, you should be suspicious. The more valid the reason for sale, the more realistic the seller will be in considering your offer. However, keep in mind that after five or six years or more, people do get restless, “burn-out” sets in, and people look for new challenges. Why the seller is selling is an important question – get the answer.

The financial records are a good indication of how well the business has been doing over the years. Keep in mind that tax records are not designed to show the business in the best light; no one likes to pay more taxes than they have to, and business owners are no different. Generally, tax returns are a worst case scenario. You need to be able to look at the expenses and discover which ones are non-cash items, such as depreciation and business use of home and vehicles. How important was that business trip to Las Vegas? A professional business broker can point these items out to you.

Keep in mind that financial records are only history. There are no guarantees that they will or can be duplicated or repeated. All of your profits are future. In the final analysis, the financial records of the business are an indicator of what the business has done; what you do with its future is up to you.

The simple answer is – you can’t! Not reporting income is against the law.

You should consider only the income that the seller can show you. We all know, of course, especially in cash type businesses, that there is the possibility that the seller is not reporting all of his or her income for tax purposes. This “underground economy” has been well-documented and is in the billions of dollars. Many sellers will tell you about how much they are “skimming,” but you should ignore their statements, since they have no way of proving these amounts.

In determining whether a business is the right one for you, you should base the decision on the figures actually supplied to you by the seller.

Insider Tip

Unless you are completely familiar with the type of business purchased, it is beneficial to include as part of the agreement that the seller will stay with you (30 days is fair, with perhaps another 30 to 60 days of telephone consultation) a sufficient length of time to teach you the business – at no charge.
If you want the seller to stay longer, it may be best to offer to pay him or her a consulting fee of some type.

Here are some questions that you should ask yourself before taking the next step

For Business Buyers

The next step to buying your own business is to make sure it is the right move for you and your family. Owning one’s own business is still very much “the great American dream,” but it’s not for everybody.
Many people are interested in buying their own business, but are not willing to make the commitment necessary to move forward. They continue to look just like those who continue to look at new and expensive automobiles, but will never spend the money necessary to buy. One veteran observer has said that the longer you look, the less likely you are to buy.
If you’re thinking of buying a business in two years, it’s good to start your education. BizBuySell is a good place to start. Keep in mind that it really doesn’t make much sense to start your search now, since any business you find now will have been sold by the time you are ready to buy. It’s important, however, to arm yourself with all of the information and education available before you begin the search.
If you are not motivated to buy a business, you won’t. You must go into business for yourself for the right reasons. If you’re tired of the corporate world, just have a “job-job,” or perhaps even a dead-end job, then business ownership may be right for you. Certainly if you’re unemployed or being transferred to a place where you don’t want to go – buying your own business can be a viable solution.
Buying your own business requires a serious financial investment. If you’re the type who does not want risk, you might want to rethink owning your own business. It is not for the faint-hearted.
Operating a small business requires continual decision making. You’re the boss, and you are in control. All of the decisions are yours – right or wrong. And, you will make a lot of wrong ones. The question is, can you recover and keep going forward? If you brood about poor decisions or they keep you awake at night, owning your own business may not be for you.
If your family, especially a spouse, is not behind you 100 percent, then you should think twice about business ownership. It’s very important that you have the support of your spouse. He or she has to understand that running a business can be time-consuming. On the plus side, however, many businesses do allow for flexibility so you can attend the afternoon little league game.
It’s best if you are open-minded, especially if you are a first-time buyer. There are many types of businesses available, and you don’t want to limit your choices. You should be looking for a business that will provide the income you need (or ability to do so), that you can afford,that has numbers that work, and, most importantly, that you can see yourself running.
Do you think that you can buy a business with lots of cash flow for $100? It’s important that you have realistic expectations about what your money will buy. Many sellers are willing to assist in financing the sale of their business, but remember, they’re not going to give it away. Keep in mind that many business owners have spent years building their business, and it may represent the biggest financial asset they have. They’re not going to just hand it over to you.
Many prospective business owners do their homework, do everything necessary to begin the purchase process, and then back out of the transaction. They just don’t have the courage to go forward. There is nothing wrong with that; not everyone should buy and own their own business. However, if you don’t think you can part with your money and take over operating the business on your own, you may want to take a second look at business ownership.
If you are looking for a guarantee or a sure thing, then business ownership is not for you. You can and should look at all of the financials, tax returns, and all of the books and records. Remember, however, that they all represent history. You can’t buy anyone else’s history. A new owner makes changes, no matter how subtle. Their management style is different, and times change. You have to look at the business with the attitude of how you can improve things. The financial history of the business is certainly important, but it does not guarantee the future of the business – you do.

Do you have other questions?

Be sure to visit Buyer FAQ for answers to the following questions

  • Why should I buy a business rather than start one?
  • What is the real reason people go into business for themselves?
  • How are businesses priced?
  • What should I Look for?
  • What does it take to be successful?
  • What happens when I find a business I want to buy?
  • Why should I go to a business broker?
  • Do I need an attorney?
Visit Buyer FAQ Section

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