Buying A Business Checklist
11 October 2019
When you a looking to purchase a new business, there are some things you simply must consider:
- The location of the business you want to acquire
- Current employees and their skillset
- Does the company have an established customer base
- Is the cash flow of the business enough to sustain itself
- What can you add to the business following purchase?
Whether you are making your first business acquisition, or you are well seasoned in the art of purchasing businesses, it’s always good to ensure you are keeping up with best practice to minimise risk when making a business purchase. With a myriad of potential pitfalls involved in acquiring a business, it can be a daunting process and puts off more inexperienced business owners. But with some support from experienced individuals throughout the purchase, the process can be extremely straightforward – allowing you to get to work turning your newly acquired business around.
If you are looking for some advice on the steps involved in purchasing a business and things to consider doing during that process, then be sure to read on to find out more!
Steps To Take Before Purchasing a Business
Here are a few of the key steps that you simply must take in the early stages of purchasing any business:
Do Your Due Diligence
It’s vital that you try and gain an understanding of why the owner is looking to sell their business at the outset of your enquiries if possible. Whilst this information isn’t always available, it’s important that you try and obtain this information where possible as it can highlight any problem areas the previous owners have come up against.
During this process, it’s vital that you spend time assessing the following areas in great depth, to ensure that there are no surprises later in the business purchasing process:
- Financial records
- Organisation records
- Physical assets
- Current employee information
- Industry & Business trends
- Customer Data
When you are satisfied with all of the above, then it’s time to give the seller an indication that you are interested in purchasing the business. The next step is to communicate directly with the seller to gain a deeper understanding of the business.
Communicate With the Seller
During the process of expressing an interest in the business you are looking to purchase, it is likely that you will have the chance to speak to the current owners to gain a deeper understanding of their business. During this stage, it is extremely important that you ask any questions regarding their business to gain an informed view of the situation you are hoping to invest in. Going hand in hand with your due diligence, this step is vital to ensure you are purchasing a business that is likely to succeed. Take the time to make a comprehensive list of questions that you would like to know more about; here are a few suggestions we have on questions that you should look to ask during this process:
- What would you do to increase sales?
- What would you change about the way the business operates?
- What is currently working well within your business?
- What would you say is the next big industry trend?
In this stage of the purchasing process, you will begin to get a real feel if the business you are looking to acquire is right for you. If you have any doubts at all, then it’s well worth exploring other options or seeking more clarity before committing to buying the company.
Hire The Right Solicitor
Once you are satisfied that the business purchase is in your parties’ best interests, it’s essential that you hire the right solicitor based on your needs. Listed below are some of the key things that you should look out for when looking to hire a solicitor for your business purchase:
- Testimonials from existing clients – Reviews are a great way to see just how credible a solicitor is, and gives you an insight into how they have performed for other clients in the past.
- Demonstrable experience – When it comes to dealing with a business purchase, you will obviously want an experienced and competent team of solicitors on your side throughout the process.
- Expressing a desire to learn your needs – Any solicitor that takes the time to understand your requirements is well worth considering as they will consider your needs throughout the process.
If a solicitor displays all of the above traits, then you can rest assured that your business purchase should run as smoothly as possible.
If you require any further assistance, please feel free to get in touch with our team of business sales and purchase solicitors. At Curtis Law, we have years of legal expertise behind us, allowing you to purchase a business with the confidence that you have a competent and assured solicitor conducting all the necessary behind the scenes work for you.
You can get in touch with our dedicated business sales and purchase team by calling 01254 297130 to discuss your requirements with our experienced solicitors. If you are pressed for time, you can simply use our simple enquiry form to get in touch, and we will endeavour to deal with your enquiry as quickly as possible.