Do you dream about working for yourself? As a business owner, you can make your own hours, create your own management style, and ultimately have more control over your income than you do when working for someone else.
However, it takes a long time to get a business off the ground. You have to start by analyzing the market, finding customers, hiring and managing employees, pricing your products and services, finding a location, and managing the day-to-day tasks of business ownership.
Instead of opening a new business, you can become a business owner by purchasing a local business for sale. This way, you can take an existing turnkey business and make it your own without starting from scratch. We’ll show you how.
Why Buy a Local Business
Did you know that 30% of businesses fail within their second year? They can fold because of lack of market interest, too much competition, and poor management.
Purchasing an established business removes some of the risk. If you do your research and choose the right opportunity, you can find a local business that already has a client base, strong cash flow, and proven success.
Becoming a business owner can open up a variety of opportunities to leave an impact on your community. Whether you’re a seasoned business owner or a new owner, this is an option to look into.
Types of Businesses
Now that you’ve settled on purchasing an existing business, you need to determine what business category you want to buy. Maybe you’ve always wanted to own a pizzeria or a full service repair shop. You can search for one that’s being sold.
On the other hand, you may not know what kind of business you want yet. It’s helpful to examine your interests and experiences and then determine how those would fit into a business. Then, check out sale listings and see what is available.
Here are a few businesses you could purchase:
The food industry is vast. You could purchase a pizzeria, deli, restaurant, or bakery. Your options are endless.
- Prime locations will come with a following.
- You’ll already know what supplies you need, how to price products, and who to hire.
- You can offer delivery services to increase sales.
- If the business was successful before it was sold, you must be able to replicate the quality. If you can’t, find someone who can.
- This industry has a lot of competition.
Purchasing a successful limo and car service company can be very lucrative. Between traveling to and from the airport and providing services for events, there will always be opportunities in this market.
- Limo and car services are always in high demand.
- There’s always a need for high-quality transportation to and from airports or train stations.
- You may have difficulty keeping up with demand without proper scheduling and enough drivers and vehicles.
- You will be competing with rideshare services, which have exploded in popularity.
Find out if any local popular businesses near you are being sold. These could be gas stations, convenience stores, ice cream shops, day care centers, liquor stores, child care services, insurance agencies, or even cleaning services. The options are endless. Plus, if the previous owners did well, the community is likely to be loyal to the business.
- You already have an existing, high traffic customer base to build on.
- It will be easier to build relationships with new and old customers if you see them face-to-face often.
- Your business can become a staple within the community.
- When you purchase an existing local business you may struggle with maintaining or improving its reputation to keep customers.
- You could have fewer opportunities to expand customer base outside of your community if you stick to a local business.
Where to Find Businesses to Buy
The next step after choosing the industry you want to work in is to actually find a business for sale. This can be tricky because business owners are not always vocal about their intention to sell their business.
If the seller knows you and has had in-person interactions with you, they are more likely to sell you their business. If you spent time and money starting up a business, would you trust just anyone to run it? Gaining that trust can help you get a better deal, access to more information on the business, and get a leg up with the existing customers.
Here are some great places to start:
Reach Out to Businesses
Arguably the best way to find out if a business is for sale is to ask the owner. This may be uncomfortable at first, especially if you’ve never done it before, but the worst they can say is no. If that happens, your conversation may put you at the top of their mind if they do decide to sell at a later date.
Just like you have to network to find a job, you need to do a little networking to find the right business. Purchasing a business from someone you know can be a major advantage for you. You probably know the area, the customer base, and the history of the business. These are all key factors that will help you make the decision to purchase or forego the opportunity. Additionally, this could help you make better business decisions if you do make the purchase.
Do Online Research
Lucky for you, there are websites created specifically for advertising businesses for sale across the United States. This advanced search method allows the owners to list descriptions, asking prices, pictures, and any other information that they want.
You can also check Craigslist, your local newspaper, and trade publications. You never know where you might find your next business. The more opportunities you explore, the better.
Look into other new businesses in the area for clues on potential great locations. Have they been successful? Or has that area proven to be a bad location to open a successful business? Is the area perfect for a national franchise opportunity, but not a small business?
Find the answers to these questions and evaluate growth potential before you commit to a purchase. If you do find your ideal business, but you don’t like the retail location, explore available commercial real estate in the area.
You can also consult with business brokers to find a great opportunity.
Utilize Your Network
Another way to find a great business opportunity is to ask your network. Tell everyone you know that you’re interested in buying a business, whether they own one or not. This way, they can keep an eye out for opportunities.
This is a great method for finding an opportunity because there is an element of trust built in. Wouldn’t you be more likely to sell your business to someone you know rather than someone who found you on the internet?
Just like on LinkedIn, each connection you make in person has a host other connections that can help you. You never know who your friends or colleagues know. They may have a cousin or friend who is looking to sell their business in the exact industry you want.
Don’t underestimate the value of social media either. You never know who you might be friends with who is looking for someone just like you to take over their business.
How to Buy a Business
Once you’ve decided to purchase a business for sale, you have a few major steps to take before you acquire your new venture. It’s best to start with a business plan.
Draft a plan to help guide your research. This will help you stay organized and ensure that you don’t miss a step.
These steps will create a clearer picture of what you need to do next:
- Determine the type of business you want to purchase.
- Find a business for sale by checking online listings or look at the Small Business Administration (SBA) website for opportunities.
- Once you’ve chosen the perfect business, prepare to fund it:
- Search for loans.
- Find investors.
- Save up your own cash with a side hustle.
Based on the information that you’ve gathered, decide what you can do to increase the profitability of the business. Whether you’ve purchased a business that has been successful in the past or just didn’t work out, there is always room for improvement.
Purchase Your Business
Finally, it’s time to make your purchase. Deciding to invest in your own business is a big deal. Now that you have the information you need on purchasing a small business, you can begin your search and map out your plan.
Take the next step towards becoming a business owner today. What kind of business will you choose?