Making an offer for a business can be a daunting process. Please read the below on how to make an offer and what you need to keep in mind before making the offer.
Before Making an Offer
The buyer should make sure that their finance is in place before an offer is made.
When buying a business, a buyer needs to be aware of the other costs involved such as Accountancy, legal fees and in most cases a Bank guarantee will be required by the Landlord.
Landlords – Things to keep in mind
In 2015 Landlords are being ever so protective of their properties and when a tenant comes to them to say that they wish to sell their business, most are taken back as they have been happy with that tenant for perhaps many years as they have always paid their rent on time and have run a good business with no problems. Now they have to offer a lease to a new buyer who they do not know.
Landlords will want to know:
- Is the buyer capable of buying this or any business?
- Is the buyer able to provide business and personal references to the landlord and a statement of their assets and liabilities to show their ability to be able to pay the rent?
- Does the buyer have the experience needed to run the business?
- An astute buyer would provide a business plan to the landlord to show them how they intend to run the business and improve it.
How to Make an Offer
Any offer should be made to the agent in writing, email is sufficient or fax. Verbal offers are accepted however for the business to be taken off the market a written offer is required.
When making an offer please ensure that you clearly describe what conditions you want. Please note Finance is not an agreed condition. For example, you may need a new lease or an assignment of the current lease, you may require training, you may need a delayed settlement.
A buyer upon acceptance of their offer should be ready to put down a deposit of up 10% of the agreed purchase price for the business to be withdrawn from sale. This deposit is held in TRUST and a Trust account receipt will be provided on cleared funds. This amount is fully refundable up until contracts are exchanged.