Frequently Asked Questions
Buy a business that you will enjoy owning and look forward to working on daily. Certainly, it is important that the business have sufficient earnings to provide a good income stream to support your needs, but it is equally important that you buy a business you will be challenged by and approach each day with enthusiasm. Do not purchase a business which you cannot see yourself enjoying, or you will end up being miserable, and this might end up being reflected in the business not doing well. The HBG professionals will work hard to find a business that suits your needs.
There are several advantages to buying an existing business:
You can review actual operating results rather than projections
There will be immediate cash flow.
There will not have to be a lot of work to attract customers and sales should continue as they were with the previous owner
Staff is already in place. There should be no down-time with untrained employees
You will have access to established suppliers and credit lines. For the most part, existing vendors will continue to do business with you. They don’t want to lose your business
There will be existing licenses and permits (if applicable.) In many cases, all you have to do is transfer the licenses to your name. In the event that you must re-apply, you can relax in knowing that the business was previously approved and you shouldn’t have any problems as well
You can be trained by the seller. The seller will be available to show you how to operate the business. They can help in making appropriate introductions and you won’t make the same mistakes the previous owner made.
Owner financing is generally available. Most businesses sold are partially financed by the seller. The seller who finances your purchase has a vested interest in your success and will want to help ensure that the business continues to succeed.
The time needed for a purchase depends on several factors, including a) the availability of the specific type of business you are looking for, b) how much you are willing to spend, and c) the geographic location you would like to purchase in. Typically, it can take about 60 to 180 days to complete your purchase of a business.
The time needed for the sale depends on several factors, including the price of your business, type of business and your willingness to finance the buyer. In general, it takes about 60 to 180 days to find a buyer for a business. Your HBG professional can discuss with you how long it may or may not take to complete the sale.
Whether drawing upon potential buyers from the pool of preregistered buyers or marketing a business to other industry sources, confidentiality is of primary concern. HBG’s strong ties to other brokerage and merger/acquisition professionals will allow your business to receive nationwide attention but yet in only in a non-specific manner so that the normal course of business operations is not disrupted. The quiet, marketing efforts of the HBG professionals allows you to continue normal business operations without being distracted by the marketing program.
Our primary source of advertising is through other broker-related web-sites and associations. We advertise aggressively over the internet, which gives your business exposure to thousands of internet users. We may send mailings to a targeted group of buyers, which complements our regular phone and personal contact with our group of listed buyers. Lastly, we may run “blind” advertisements, which do not include any specific information about your company but will attract those interested in your type of business.
An astute buyer is going to structure the initial offer to ensure that they are getting the best possible price and terms from you. Therefore, you should expect to receive an initial offer below the asking price. Don’t be offended by this initial offer. The buyer typically does not expect you to take the initial offer, nor should you necessarily expect the buyer to accept your initial counter offer. Most offers will have some contingencies. These normally include a) obtaining suitable financing by the buyer, b) obtaining an acceptable lease agreement with the landlord, and c) reviewing detail financial information. The “due diligence” period occurs after the parties reach substantial agreement on the major components of the deal and allows the buyer to make sure that the representations about the business are materially correct.