Posts Tagged ‘Buying An Existing Business’
Several magazines have been running features from me over the last couple of months. One in particular appeared in Pizza and Pasta as well as their Cafe sister publication. In case you mised it we thought you might find the following interesting: Everyone thinks that they can run a food business – be it an Italian restaurant, Pizza house or take-away – and so many try and fail. Which is why it is worth exploring what you should do to avoid failing, if you are determined to go ahead.
What are your options? Well, you could be buying a business that is already well established, with existing sales and a good track record. In this instance you’ll be paying a premium for the business, known as ‘’goodwill’’. That’s fine in itself, as long as you are not paying too much for that business in the first place. If you are, then there is a danger that the business may not produce sufficient profit to give you enough ‘’payback’’ on your initial investment.
Worse still if you have borrowed capital to buy and run that business, and you are paying interest on that money. So – you need to think this through carefully. But there is a big difference between buying an existing business and the alternative – starting one up from scratch.
Before you commit to anything such as premises, you need to do some planning…