Things to Ask Yourself Before Buying a Business

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You know you want to be successful if you buy a business, so you are wondering if you have what it takes to be successful.  What do you need to be a successful business owner?  Perhaps you can look at some business owners you know and see what you think makes them successful. 

The following are some things you might want to ask yourself before you buy a business.

Do you have a good knowledge of the product or service you will be selling?  Depending on the type of business, you may be able to learn about the product or service if it is not too technical.  However, if you choose a business to buy of which you have no knowledge or background, it will be important for you to learn all you can before the closing papers are signed.  Sometimes buyers want a complete change from what they have done and see a business that has lots of appeal to them.  The logical thinking is that employees are in place, so you as the new owner will only run the operation.  Under some circumstances, that is possible; but the best idea is to understand what each employee is doing and be able to personally do each job.  That will give you confidence, as well as your employees, that you understand the full operation and could fill in for any employee if necessary.

Do you have enough financial knowledge to run a business?  While most people have at least some technical knowledge of the business they are buying, many of them know nothing about finances or accounting.  There is a difference in financial knowledge and expert financial knowledge.  You do not have to be an expert at everything; you just need to know who to contact and when you need to contact them.   You may choose to hire a bookkeeper for the daily record keeping and request the services of an accountant to prepare tax forms for you and give you advice.  Most business owners are happy to turn that part of the business over to a professional.    Accountants will be happy to work with you and do as much or as little as you require.  The important thing to remember is that you need to keep accurate records.  Your suppliers will likely have a software program to assist you with pricing.  If not, you can ask them for advice on markups.  They want you to be successful, as they want you to continue to purchase from them.  When you are buying a business, the owner will train you and give you suggestions.  You may want to set your books up exactly like the current owner.  If not, your accountant will be able to help you with that.  There is good bookkeeping software, so you just need to stay current so you’ll always be ready to give the necessary records to your accountant.

Do you have good communication skills?  A small business owner communicates on a regular basis with employees, customers, suppliers, competitors and the general public.  If you are a positive thinking person, those with whom you communicate will likely be positive, also.  Most people never tire of being called by name or receiving a compliment, and compliments build confidence.  The words we say are only a small part of how we communicate.  Actions also leave lasting impressions.  The tone of voice, a smile, eye contact, and a firm handshake are all important.  The image you project is an extremely important part of communicating and is at least as important as the words you say.  How others perceive you is always more important to them than what may or may not be true.  You are a walking, talking public relations agent for your business; and a good image is very important to any business.  The biggest part of image comes from the people who make up the business, you and your employees.  The way you act with your employees and customers is of primary importance in conveying an overall image of value.  This is more important than all the advertising in the world.  Most of us can’t really understand how we appear to others, but we can easily see the effect we’re having on other people.  When you practice warmth, friendliness, honesty, patience, tact, courtesy and promptness, other people respond in positive ways that can be seen. When you are open and honest with yourself and others, everyone you deal with will notice and appreciate it. 

  • Author: Pat Jones
  • Title: Business Owner - Business Broker
  • Company: Pat Jones Business Brokers
  • Company Website: http://www.patjones.biz/
  • Date: September 20, 2018
  • Category: Buying a Franchise or Business
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