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M Burris

In the early days of creating A1moneysource.com, the initial idea was to help potential business buyers see the wisdom of purchasing a business or investment property with positive NOI (Net operating Income). Our mission was to educate individuals about the benefits of owning a business, what things to look for and what things to avoid. In addition we endeavored to do a matching service. Our business grew so rapidly that the Local Coldwell Banker Commercial Division was swamped with requests of people wanting to purchase businesses, so much so that they could not keep up with the demand. And so begin the journey. M.Burris CEO and Co-founder A1moneysource.com

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Why Buying An Established Business Is Smarter Than Starting A New One

The benefits of owning a business.

M Burris

October 30, 2008


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You have an immediate cash flow

Established customer & referral base

You have trained employees in place

Established suppliers & credit facilities

All your existing licenses & permits are in place

You have training by the vendor

You have the availability of vendor finance

Small business ownership and its operation has proven to be one of the most financially rewarding and intellectually stimulating pursuits that you can follow in your working life. And, you have the opportunity to be a master of your own financial destiny.

But, it can also be very frightening for those just starting out! We have all heard about the high mortality rates for new business ownership; 50% do not make it through the first three years and 70% will be gone after only five years.

There are many reasons for this including; insufficient operating capital, poor management, an unworkable business concept, inability to develop a strong customer base, and the list goes on. It would be great if these potential problems could be eliminated or at least minimized for you as a new business operator.

Well, they can! How?

Buy an Existing Business

It has been proven that the vast majority of profitable businesses that are purchased continue to operate successfully for many years to come.

There are several key advantages to this:

There is no question, that the success rate for new business owners that have purchased an existing business is much higher than for those who start a newly formed business. This makes good sense. An existing profitable business has a long standing track record of profits and has already proven that it is successful, which will most likely continue long after the business sale.

An established customer base for immediate cash flow

No suffering through a long start-up period where you struggle to attract customers to your business. Use these long term customers as a building block for future business growth.

Use of seller financing

Use business seller's financing for a large portion of the purchase price to maximize your buying potential.

Customers:

Buy a business and you also buy its customers. The more customers, the more you will pay for the business. Still, you'll have an immediate cash flow and an opportunity to improve on existing business relationships.

Product:

When you purchase an existing business, you usually receive whatever merchandise is on the shelves or in the warehouse. This will give you an idea of what sells and what doesn't and allows you to spend your capital on other necessary items such as advertising or payroll.

Employees:

Once the business is yours, you can keep any or all of the business' employees. Seasoned, knowledgeable employees can help you overcome the early jitters and share with you any quirks or insider information that's vital to the business or industry. There can be apprehension by the existing employees, so this is an area of opportunity as well as concern.

Identity:

Identity: Good existing businesses already have an identity and an image. You may have the opportunity to improve on an already shining image.

We work with a network of Business brokers and can assist buyers in their need to gather as much information as possible to; find a suitable operating business for sale, properly value the business, arrange your purchase financing, successfully conduct negotiations, and finally, to actually close the deal and transfer ownership.

Tens of thousands of small business sales occur every year with little or no real problems and the new owners and the sellers both realize their goals.