5 Basic Tips in Buying a Business
Some business owners in Singapore choose to sell business shares, or the whole business itself, because of certain reasons. And many business minded people take advantage of this because of the many advantages that comes along with buying an established business. Apart from the experienced employees and existing customer base, to buy business means saving your efforts in establishing business in its initial stages and diverting your attention to further improve the services after buying it.
If you want to pursue buying a business instead of starting one, consider these tips to help you in making the right decision.
1. See different business for sale advertisements
Business for sale ads are mostly found in newspapers, magazines, and online. You can also inquire to business accountants and advisors about any for sale Singapore establishment in the market. You can also list your business requirements online and receive alerts and notifications via email whenever a business of your interest is on sale. Also, learn about pending business sales through customers, competitors, and suppliers.
2. Look for a business that interests you
Be sure to buy business of your interest, ability, knowledge, and experience. Choose something that is line of what you love or like doing. Although enthusiasm and experience solve many problems, your business knowledge is highly important to identifying a business with potential or one with none.
3. Look for uniqueness, exclusivity, and growing demand
The company’s products and services should make you response with a “wow!” It should be something that you and your competitors would want, need, and demand. Rely on strangers and test ads, appeals, and do product testing. Get real reviews and feedbacks from real consumers by talking to a few costumers of the business for sale. Don’t try to ask the business seller’s opinion as they have the tendency to be biased just to sell business.
4. Gather as much information as you can
To successfully buy business, researching everything about the establishment and the seller is a requirement. The financial claims given to you in order to sell your business here in Singapore by the seller should be verified in order to find out its legitimacy and to ensure that they’re not just stated to sell business. Similarly, the due-diligence should be completed with utmost attention to details to avoid any discrepancies in the future.
5. Be flexible in evaluating the business
Remember that some Singapore business owners choose to sell business because they can no longer save the company. There are good companies with great products and high potential business structure that has bad administration who keep important records poorly and squander their hard-earned profits. One of the big mistakes that business buyers make is only relying on a standardized business valuation that shows such companies not worth much. A stressed, careless, and distracted business owner that struggles to explain everything to you may not reflect real potential. To evaluate the company more accurately and reveal its potential success, give yourself the time to study the records and raise clarifications. You should be able to determine what sales and profits will be or can be achieved in two to three years’ time.
Buying a business can be a little risky, especially when you’re not equipped with the right information about the business you’re buying. Therefore, it is always important to seek expert advice from professional who have been in the buy-sell business for years. Gaining assistance from business valuation practitioner could be your best option for a more accurate business appraisal.