Business listings
The Basic Steps of Buying a Business
Your position has been outsourced, eliminated, or it’s just that time in your life when the desire is there to purchase a business. It's that time to strike out on your own.
We at Hartford Business Brokers represent “Sellers” of existing businesses. Our Clients pay our “success fee” or “commission” as it is called when there is a successful closing. You the Buyer do not pay our fees.
We will represent a “Buyer” shopping for a business when we enter into a written contract for a Directed Search and you the Buyer pay our fees. We will disclose our arrangement to the prospective seller; this is so we can have 100% loyalty and services to you.
Businesses today are pretty much classified into the following business sectors:
1. Manufacturing
2. Business Services
3. Franchises
4. Personal Services
5. Wholesalers & Distributors
6. I.T.
7. Medical
8. Retail
9. Transportation
10. Food Establishments
If you are going to be successful or increase your chances of success,you should have general or specific background in that business sector – More important is you will probably need financing,and in 2009 financial institutions look for experience in that business sector, either specific or general.
In this 2009 recession, Banks are continuing to make loans on good businesses with qualified buyers. Today loans under $3 million dollars are backed by the SBA. The loan programs are administered thru local designated banks in Connecticut, Massachusetts, New York Vermont and Rhode Island. If you want to get out front of the financing piece call us for the name and contact information of an SBA participating Bank in the area.
With the advent of the internet a number of businesses for sale web sites have cropped up: go to them, use them as a resource:
1. www.bizbuysell.com
2. www.businessbroker.net
3. www.businessesforsale.com
4. www.mergernetwork.com
Many times a business for sale is represented by a Business Broker. That’s a good thing, as the Broker wants to sell the business and make a commission and has no emotional attachment to the business as a seller normally does.
Contact the Broker by phone or e-mail. Be prepared to tell the Broker who you are and what business they have advertised you are interested in receiving information on. The Broker will e-mail or fax you a Non-Disclosure Agreement to review and sign. Do that. Also bear in mind that Business Brokers have "confidential lisitings", that are not advertised so ask the Broker if they have a listing in your specific area.
Upon receipt of the NDA, the Broker will provide you with financial and operational information on the business. Ask lots of questions, engage advisors such as CPA’s and attorneys as needed.
Expect or ask for at least 3 years of tax returns and 3 years of P&L Statements. Begin to independently verify the information provided.
We at Hartford Business Brokers provide potential Buyers an “Executive Summary” on the business we are representing that is typically 12-20 pages in length; ask the Broker for this.
Schedule a meeting thru the Broker to meet with the owner of the business on a day and time that is convenient for both of you. Ask lots of questions; expect the meeting to last 1-2 hours.
If the chemistry is there and you want to start down the road to purchase the business get a team in place – a CPA and an attorney. You will need both to you help perform Due Diligence on the business as well as prepare the Purchase & Sale Agreement.
Due Diligence involves a myriad of financial and operational items. The Broker should have a preliminary checklist from when they first listed the business; ask for that then expand on it as necessary.
Offers on a business take the form of Offers to Purchase, Letters of Intent and basic Purchase Agreements.
In conjunction with the sale we negotiate the transition between the old owner and yourself.
Hartford Business Brokers represents clients in Connecticut, Massachusetts, New York Rhode Island, and Vermont.
Please feel free to call us at 860.674.9755 or 203.466.2266
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