Buying a business can be a time consuming and intricate process, especially if you’re entirely new to the process! So this month we thought we’d address some of the top ‘Buying a Business FAQs’ we get asked here at the Core Business Brokers Sydney office.
When buying a business, what happens first?
If you’re wanting to buy a business, the first thing you need to do is organise your finances. Obtaining a business loan can take time, so chat to your financial advisor as a first step to understand what information they would require. After this, it’s time to go window shopping! Come into the office and let’s chat about your goals, requirements and what we’ve got available in your industry and budget.
What determines the business’ value?
When a business is listed with Core Business Brokers, our qualified and knowledgeable team will conduct a business appraisal, which determines the fair market value of the business. We’ll take into account the business’ profitability, structure, historical sales data, a SWOT analysis and other factors which influence how the business is fairly and accurately valued.
What is included in the business sale?
This depends on the negotiation process between buyer and seller. Each business is different and may include or exclude different things. You may want to retain the staff, or you may want to bring in your own team. It is also important to understand the difference in buying the sellers shares or if you would be buying only the assets of the business. There are pros and cons for both options. Every facet of the business will be discussed and what is included in the sale will be decided during the negotiation process.
How long does the process take?
As little or as long as it takes to agree to the sale terms. If financials aren’t in order, lease terms can’t be met or other factors become subject to negotiation, a business sale can become a lengthy process. The process ranges from as little as a few weeks to as long as 6 months in some cases. It pays to be efficient during this time (and hope that all the stars align as efficiently as possible too!)
How do I know if the records provided are accurate?
Two words… due diligence. Take your time and spare no detail when it comes to cross-checking records and fact-checking all information provided by the seller. Your team at Core Business Brokers will guide you through your due diligence process and teach you what to look out for. Ultimately you want to confirm that all details provided are as accurate as possible. If you find inaccuracies, these need to be discussed before signing on the dotted line.
When do I officially own the business?
You will officially take ownership of the business on the settlement date. This is the date when legal title of all aspects of the business are handed over and you step inside to begin your business ownership journey. It is the final piece in your business purchase puzzle.
If you’re looking to buy a business, contact the team at Core Business Brokers today. Our business listings are constantly updated with new businesses each week! Schedule your appointment with the team today to get the ball rolling on your business purchase journey. Call us on (02) 9413 2977, or email Roy at [email protected] or Rad at [email protected]. We look forward to meeting you.