Buying a business is likely to be one of the biggest investments you ever make. If you’re planning to be actively involved in the business, it’s not just money you’re committing, it may also be a significant investment of time and effort. Whether you’re buying a micro-business, or a large, established company, getting expert legal and financial advice before you sign any agreement is essential.
Buying a business
Any reputable business operator or vendor should be happy to provide you with the information necessary for you to carry out your due diligence. Regardless of the size of the business, or the industry, you can begin by considering:
Any solid business should have a good reputation with customers. Ideally, a business should also have a good reputation with suppliers and partners. A quick online search will often bring up past or present issues that may be of interest.
Ownership and assets
Your legal and financial advisors will look into this in detail if you plan to purchase. As a start, you can do your own business searches and list the assets you know to be included and those you believe should be included in the purchase of the business.
How many employees does the business have? Are they likely to continue employment under new ownership? What will happen if they don’t?
Stock and sales
Are existing stock levels depleted, or do they include unuseable items? What percentage of sales are costs? Could you increase sales or reduce costs? Would you need to increase stock levels or drastically markdown outdated stock to make these changes?
Premises and location
Are the premises freehold or leasehold? If they’re leased, how long is left on the lease? Are there new or future developments that might have an effect on the business?
Looking to buy a business?
Property Law Service can help you make a smart business purchase. Before you sign any agreement, please contact us for advice or talk to one of our team on 0800 PPTYLAW (0800 778 952) or +64 6 3705102.