1. Search businesses
Look at your local Craigslist, searching for “business for sale” in the For Sale section. On BizBuySell.com search and filter by a reasonable price point. Get familiar with their terminology (cash flow, etc.). Sort by different metrics and get a feel for what is typically listed and how long it’s been selling for.
2. Send out some emails
Show your interest, ask some questions and see how engaged or motivated the buyer or buyer’s agent are in selling. You’ll sign an NDA for more detailed information and financials. Talk to some professionals on your team; an accountant, etc.
3. Financing
This can be a combination of your cash, seller-financing and SBA or bank financing. Don’t limit yourself to just cash, and the sale price is negotiable.
4. Why
The why is the most important part in the process. Why are you doing this? Are you simply kicking the tires and window shopping? Can you see yourself doing or running this type of operation? Do you have any experience or excitement within this field as a consumer? Are you looking for a change of career or location? Is the owner someone you see yourself working with, as you transition the reigns? Did they run into serious problems that will now become your’s?
Summary
This is a perfunctory list of how to purchase a small business. I purchased one in 2014 and it was an amazing experience with many more details. There are benefits over starting one from scratch and in times of volatility such as now, there can be many motivated sellers.
Please message or email me if you are exploring this further. I can make a more detailed write-up if requested.
