Buy Business Canberra

Buying - Why buy?


Buying an existing business means you don't have to reinvent the wheel.

Owning a business is a dream for many.  But the fear and risk of start-up costs deter many from ever delving into the realm of entrepreneurship.

But buying an existing business could get you the best of both worlds.  You get the freedom of being your own boss without the risk of an unknown market.  Even if you're paying a premium price for an existing business, at least you know what you are getting for your investment, given that you look into it properly.

Business brokers report that seven out of ten businesses they sell are still in business five years later compare that with the international average of 9 in 10 new businesses go out of business within the first two years, buying an existing business certainly seems a much more viable option.

Advantages of buying an existing business:

  • Immediate profits: You can get an income from the first day of operation without waiting to establish profits.
  • Less risk: Internationally, 9 out of 10 new businesses fail whilst almost the opposite is true for buying a going concern.
  • No start-up problems: Customers, employees, suppliers and other assets are already there.
  • Investment level known: You may be able to buy an existing business for even less than it would cost to duplicate the assets by starting a new concern
  • Securer growth:  Buying an existing business to bolt-on to your business is often the best way to grow.


Buying - Steps to Buying

Never bought a business before?  Not sure where to begin or what's involved?  Here is a checklist of the common steps which shows it is really not that scary, especially when you have experts to guide you:

1. Investigate - check out businesses for sale in the newspaper, on the net or simply contact us.

2. Confidentiality - we will ask you to sign a confidentiality agreement.

3. Discuss with broker - we will pass over a business profile, which gives details of a business for sale. Explore its potential as an investment.

4. Inspect the business - we will arrange for you to see the business. Sometimes the seller is present; generally we will act on their behalf.

5. Meet the owner - your opportunity to ask the hard questions to the one who knows the business best.

6. Seek more information - such as detailed financial accounts to back up the summary already provided.

7. Make an offer if you are still interested - make a clear and detailed offer.

8. Offer presented - the broker takes your offer to the seller, but expect a counter-offer.

9. Check counter offer - decide whether to accept the counter offer or negotiate further.

10. Letter of intent - If you and the seller both want to continue to the next stage you may have to sign a letter of intent and pay a deposit which allows you to access additional information without committing fully to the purchase.

11. Carry out due diligence - investigate all areas of the business and decide whether it still interests you. A Sale & Purchase Agreement - is drafted (usually by the seller's solicitors) and sent to both parties for signing. There are usually conditions such as lessor approval of the lease transfer.

12. All conditions met - the agreement now becomes unconditional until the final date of settlement.

13. Lawyers finalise things - both buyer and seller sit back and leave it to the people in suits to co-ordinate settlement.

14. Settlement - the seller gets the cash and the buyer gets the keys to the front door.

15. Stocktake - any variation in the value of stock prior to and after settlement is adjusted.

16. New owner steps in - it's all yours!

17. Training and support - the old owner often stays on for an agreed period to show the new owner the ropes

18. Acceptance - if you both agree on the final details it can still be conditional on a number of factors, such as finance being arranged, or a certain contract being approved.


Buy Business CanberraLooking to Buy a Business in Canberra?

Brindabella Business Brokers can help you with all your needs if you are looking to buy a Business in Canberra. Contact us today for more information, or to get started.