Purchasing a Business

Purchasing a Business

Purchasing a business can be a rewarding endeavour. From improving the businesses’ current customer base to adding your own spin to the new company, witnessing your hard work take form is a gratifying experience.

What do I need to know about purchasing a business?

Purchasing a business is a complex feat. It requires extensive research, time management, a qualified team of professionals (lawyers, accountants, business managers), and adequate knowledge of business operations. As there are various forms of business structures to purchase, weighing the pros and cons of each business structure will allow you to make an informed choice and wise investment.

.

The most common business structures are franchises and independent businesses

Franchises generally have a proven track record of consistent sales, dependent on geographic location and other variables. Independent businesses are typically less consistent in sales and development than franchises. Independent businesses, however, often have more control and leeway in how the business operates.>

Pros to Purchasing a Franchise:
• Established track record of operations – in general terms, you understand what you will “get” from the franchise
• Established Customer base and goodwill
• Established onboarding and existing support operations
• Set formulae and procedure to follow

Cons to purchasing a franchise:
• Not a lot of room for creativity as you will be limited to a franchise agreement
• Payment of franchise fee and royalties to a franchisor
• Less room for excessive growth often accompanies with greater risk

Pros to purchasing an independent business:
• No franchise fees or monthly royalties are owed to a franchisor
• Flexible schedule
• Room for expedited growth with risks, if taken
• May create a more rewarding feeling, as the business is solely yours

Cons to purchasing an independent business:
• More responsibility
• Time-consuming, particularly with the creation of staff schedules, procedures, written policies, etc
• Room for expedited growth with risks, if taken
• Personal funding and resources most often required

Regardless of whether you choose to purchase a franchise or independent business, conducing extensive research is always the best step to take.

If you have specific questions related to purchasing a business, get in touch with a representative from Saidi Law Corporation today.