Are you trying to buy or sell a business? Are you overwhelmed with the process and don't know where to start? If that sounds like you, then you have come to the right place. Buying or selling a business can be a complicated and tedious legal adventure.There are many reasons why someone would want to buy or sell a business and many different types of businesses being bought and sold everyday. No matter what your involvement is, the standard procedures will help guide you through any circumstance.Before buying out a business, consider these four simple steps to ensure smooth sailing in the transaction process.
“Why am I buying this business?" You need to understand your goals and vision for this business. Make sure, before you jump into something as serious as a business transaction, that you have done background research and understand the industry that you are getting into."Is it something you have experience in?" "Do you have the resources needed to continue the operation of the business?" These are just a few examples of the kind of questions to consider.
Work with an attorney and an accountant to look at the finances of the company you are buying. Learn all you can about the background of the company. Buying a company is always considered a risk, even if you're sure the business will do well.The accountants can help you review the financial statements of the company and the attorneys can help compile key legal documents. If the business being considered for acquisition is unstable financially, then the investment is a “no-go”.
As important as it is for you need to understand the companies finances, equally important is to understand your own financial standing and your ability to invest in a company. Are you able to receive the funding necessary for you to be able to buy this business? Will you be using your own funds, will you borrow from family, friends, investors, or will you need funding from banks? These are very important questions to ask. If you don’t have the means to complete the transaction, then it won't work out.Sumsion Business Law can help you structure and negotiate these types of funding deals in a way that is safe and beneficial for everyone involved.
Work together with an attorney to make sure that all of the contracts are tightly sealed and above all, fair. Have the attorney review the terms and sign the papers. A well written and clear contract at the beginning of the venture can save you time, money, and future headaches down the road.If you've made it this far, the business is yours! Congrats! These simple steps are just building blocks to help simplify the process. These steps should be analyzed more in depth when the time comes to buy or sell the business. These four tips should help you to at least have a starting point to gain a better idea of where to go from square one.