Buying a Business VS. Starting From Scratch
Want to be your own boss, work for yourself, establish a business and watch it grow? Then you’ve probably asked yourself this question already… What’s the difference between buying a business VS. starting From scratch?
It’s a valid question and an important one at that – as there are pros and cons to consider for each option. So, make things a little easier to digest, we figured it best to break them down for you!
| Buying a Business | Starting From Scratch |
| PRO | CON | PRO | CON |
| Success can be seen. It’s a proven concept | Higher upfront cost in purchasing the business | Complete control over all initial business decisions | Harder, longer hours upfront in establishment phase |
| Reduced start up time & lower establishment costs. Profits from day one! | Lots to learn – you’re stepping in and learning everything immediately | Creative freedom to take your business in any direction from the beginning | No one is there to guide you and there’s no benchmark to compare against- risk it may not work |
| Customer base and supply chain already exist and can be verified | Potential improvements could be vast and time consuming | Building goodwill as opposed to buying it means starting on a clean slate | Lack of cash flow means you may not see profit for several years (avg. breakeven is 2 years!) |
| Financial history makes it easier to obtain finance | Potential hidden problems may arise with time | Initial costs grow gradually as the business grows | The feeling of uncertainty and risk, second guessing each decision |
| The brand is already established with goodwill attached | Dated processes may require extensive revamping | Choosing the right team for the job | Forming supplier agreements without reputation and history could prove difficult |
| A team of staff that already understand business operations are ready to go | Bad reputation could affect the business’ future, even under new ownership | Opportunity to start fresh and make your mark on the industry | The amount of homework required before you even begin can be extensive |
Want to discuss your business purchase options with a professional who understands? Contact Core Business Brokers today, on (02) 9413 2977, or email Roy at [email protected]. With decades in the industry, our team will help weigh the pros and cons and allow you to form a plan to suit your individual goals and needs.
