Turnkey businesses for sale can be an enticing investment project. Also, with many fundamentals such as a customer base, marketing, and successful product or service already in place - you have only to continue to drive the business and watch it grow.
There are a few different possible ways to purchase an established business. Here are some of the different types:
Franchises: Famous as turnkey businesses, franchises offer buyers a new business ready to go. For example, many fast-food chains are franchises. The larger company takes care of major aspects of setting up a business such as suppliers, building space, marketing, etc. In addition, many franchises also minimize competition by making sure their stores are spaced out. All of this start-up assistance helps make sure that the franchise succeeds.
Small Business for Sale: Like franchises, other small businesses also have established marketing, suppliers, building space, etc. However, they don’t have the support of a larger company that may teach procedures or provide other training. Often owned by families or individuals, small businesses can also be great investments.
Before you jump to purchase your favorite café or retail shop that goes up for sale in your town, there are a few things you should consider. Here are some major steps you should take before signing the paperwork:
Why Is the Business for Sale?: Find out why the business is really for sale and beware of red flags. Often, business owners simply lose passion for the business or want to move on to something else. Other times, they’re ready to retire from a lifelong commitment to the business, or they’re facing illness and can no longer handle the workload. Any of these reasons are fine and don’t threaten the future health of the business.
But, check plans in the area to make sure a big new corporate competitor isn’t moving into the area, threatening the business. Or, perhaps the business is in the red and no longer viable. Any number of red flags may appear as you investigate this further, so check carefully.
Do Due Diligence: When looking at companies for sale, it’s vital that you do your homework. Helped by professionals such as a CPA and business valuator, check through several years of financial statements and tax returns. In addition, carefully evaluate the assets and debts associated with the business.
Also, check the business’s reputation among customers by looking at social media and review websites. Loyal customers and clients are essential for the future success of the business. Don’t forget to look into contracts to see which clients would continue even after an ownership change.
Discover Opportunities: Some businesses might have easy to add sales opportunities. For example, a retail store might be missing opportunities by failing to offer online sales. If you can boost the businesses annual profits with relatively small investments, the better the returns for you!
Many businesses can offer you a lucrative investment opportunity you’ll be glad you took. By carefully evaluating local businesses, you could discover a gold mine.