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What questions should I ask when buying a business?

Guest post by: Andrew Rogerson

Article Overview: There are many questions buyers typically ask when thinking of buying a business that include the level of sales, qualifications and motivations of the employees, questions about landlord and suppliers. While these questions are helpful and appropriate, this article offers some more questions that will help in the decision of buying a business.

What questions should I ask when buying a business?

Most business buyers don't have a shortage of questions they want to ask when they are looking to buy a privately held company or business. There are obvious questions about the level of sales, qualifications and motivation of the employees, the relationship with the landlord, if payment to suppliers is up to date and many other good and appropriate questions. Apart from these questions, there are others that may help a buyer decide if the business is a good fit for them. These questions include the following:

1. Does the business have any tax liens in place and are there any tax liens against the owner?

2. Does the business have any lawsuits pending?

3. How diverse is both the customer and supplier base?

4. What's the reason the owner wishes to sell?

5. Is the business in, ever been in or likely to go into Chapter 11 or Chapter 7 bankruptcy?

6. Is the lease transferable and is there a cost to transfer the lease?

7. Are the employees unionized?

8. How could the business be expanded?

9. How could the operations of the business be improved?

10. Has there been any negative press on the business or the industry?

11. Has there been any recent change or upcoming changes that could have a negative impact on the business?

12. Does the business have a good management team or key employees in place?

13. Are there written operations and training manuals that are up to date?

14. Who prepares the financial statements of the business and what certified professional assistance is used?

15. What is the role of the seller in the business on a day to day basis and what documentation exists about the role they play?

A buyer has many questions to ensure they feel comfortable about the business they are buying. The questions are not just about what, where and how the seller is involved in the day to day operation of the business, but about the skills and expertise of the buyer and whether they think they can replicate what the seller does so the business doesn't decline. There is a saying - no question is a stupid question - and this especially applies when buying a business.

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Article Tags: Andrew Rogerson, business, Business broker Sacramento, business escrow, business for sale, business opportunity, business plan, Buy a business, buy a franchise, due diligence, franchise, Murphy Business and Financial Sacramento, Sacramento business brokers, Sacramento business ownership, sell a business, start a business



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Asking questions is key. - Hi Andrew, I think you need to know why they should buy your stuff - what's the real benefit to them, why is your stuff better than what they are already carrying on their shelves. Then you need to start out the call asking a lot of questions. Just remember this saying: Nobody cares how much you know until they know how much you care. If your questions are good enough your prospect could actually make the case for your product before they even know what it is. You might think of asking questions about what lines they carry, who their clients are, what are they buying, why do they think they are buying that type of stuff, is it a problem getting stock, what types of margins are they getting, etc. Then pitch your product according to the answers. Before calling I would create a long list of questions to have on hand so that you have an easy reference - listen to the answers and continue probing with related questions. That's all I can give you without knowing more about your products.
Re: Is it worth buying a Dell computer with financing? - what you should know is that whenever you are buying any item and apying monthly you are definitely paying at least 50% more than if you buy it cash. I beleive on the long run it is worth buying the computer with finance if you are using it for business. My rules about buying things on credit is basically for business and nothing else.
Don Campbell Live Today in Toronto - Just a reminder that Don Campbell will be live today at the above information. If your in the Real Estate business in Canada you will enjoy to hear what he has to say and his outlook. He is also well versed in the Alberta market and can also answer questions you may have on it if you plan on buying property there to add to your business and clients. P.s. if you have either of his books you can get it signed by the Authors: Don Campbell and Russell Wescott. Enjoy.
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