Many people think having their own business would be easier than working 9-5 for someone else, but in fact it is harder because when you own a business the buck stops with you. It is wise to always consult a lawyer’s list before making a final decision about buying an existing business and to keep that lawyer on so you have quick access to help should any problem crop up.

When you own a business, the responsibility for everything being right rests on your shoulders – and sometimes you have to step into the gap when an employee doesn’t show up at the last minute. If anything goes wrong, you are the one who has to fix it, or at least ensure that it is fixed by someone else who knows what they are doing. While there are many responsibilities, there is also a great deal of satisfaction at meeting the challenge successfully.

Here are 13 tips to consider before buying an existing business: –

  1. Find out why the business is being sold.
  2. Look at the location and make sure it’s not in a flood zone.
  3. Consider the customer base – is it large enough to make a profit?
  4. See what costs/debts the business has.
  5. Is the present inventory included in the sale price?
  6. What assets does the business have apart from the inventory and are these part of the deal?
  7. Look at the lease agreement and ensure it is suitable.
  8. Consider the business structure and find out the legal and tax requirements of it.
  9. If the business is a partnership, do you have an agreement with the other partner before you buy.
  10. Find out what the previous business owner has tried that has not worked and what has worked.
  11. What are your expectations for the business.
  12. Have you written a business or marketing plan.
  13. Is there a good chance for expansion to the business?

There are many things to consider when buying a business and it is essential to run the details by your solicitors and accountants. Be particularly careful to ensure the previous owner actually gives you the correct figures as some people have two sets of books; the real one and another one that looks better. An accountant should be able to give you some idea if this is the case simply by looking at the customer base, type of business and the numbers you’ve been given.

Sometimes it is a good idea to just spend time in the area and watch how many customers go in at different times or days. You could also ask questions of other people in the area about the business to find out how it is run and how popular – or not – it is.