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Buying An Existing Business Part IX of IX

Guest post by: Bob Macek

Article Overview: This is the IX Part of a IX Part series of articles discussing the buying of an existing, small business. In this article we offer some parting advice and tips to buyers seeking to purchase a small, existing business.

Buying An Existing Business Part IX of IX

Thank you for taking the time to read this report. I hope ideas will serve you well in your search for the right small business at the right price.

In summary it's important to remember that to get a good business at a good price involves a thoughtful, logic approach. The eight steps in this report represent a good starting point.

Here is a brief review of each step:

1) In the first report. "The Introduction", we provided some hot tips on how to buy an existing, small businesses or franchises.

2) In the second report we pointed out the importance of reviewing your qualifications and what you need to do before beginning a search for an existing business.

3) The third report emphasized the importance of analyzing the your business goals and solidly establishing those goals at the outset of your search. We encourage you to write your goals down.

4) Focus in the fourth report was on the business plan and the we provided you with some tips on how to develop a small businesses plan.

5) In this fifth report we offered a few how-to tips for financing the purchase of an existing, small businesses or franchises.

6) In this report we concentrate on discovering how to go about finding a good, small, existing business or franchises for an excellent price.

7) Report number seven, how to perform due diligence, is an extremely important step and can make the difference between success and failure.

8) In report eight we cover briefly methods to help you in discovering the value of a small business.

9) The final report, which you are now reading, represents a summation of the eight previous reports.

Again, We hope you have enjoyed these reports and we welcome any and all suggestions.

And as always, Success in your quest!

A FEW DEFINITIONS

"ADJUSTED OPERATING INCOME (AOI)" -- Used in a cash-flow valuation and recasting the profit and loss statements.

"CONFIDENTIALITY AGREEMENT" -- The promise that you'll use the information only to make a decision about buying said business.

"DUE DILIGENCE" -- The due diligence is the time when you will have access to the company's books and records.

"EXISTING" -- For purposes of this ebook we define "existing" as a business that is up and running, offers a product and/or service, has a physical location, and financial records.

"GOODWILL" -- An intangible asset which provides a competitive advantage, such as a strong brand, reputation, or high employee morale. In an acquisition, goodwill appears on the balance sheet of the acquirer in the amount by which the purchase price exceeds the net tangible assets of the acquired company.

"LETTER OF INTENT" -- A business purchase letter of intent is really a non-binding agreement that says "I would like to buy your business for an asking price of $xxxx, but first I want to take a closer look at your business".

"SELLER'S DISCRETIONARY CASH (SDC)" -- Profit and loss line items added to the bottom line. Used in a cash-flow valuation.

"SMALL BUSINESSES"-- Rather than define "Small Businesses" based on annual sales, number of employees, or other quantitative measures, Let's define a small business as one with only one level of management, namely you, the owner. This definition may not be perfect but for purposes of our discussion it better sums up what most small businesses really are.

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  Buying a Business FAQs
  Buy An Existent Business or Start Up Your Own Business
  Buying a Business
  Choosing a Business
  Should you buy or start a business?

Article Tags: briefly, business goals, business plan, cash flow, definitions, due diligence, eight steps, franchises, good business, good starting point, logic approach, nbsp, number seven, operating income, outset, small business, small businesses, success and failure, summation, taking the time



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