Tweet

How to Buy The Right Business For You

Guest post by: Richard Parker

Article Overview: If you're going to buy a business, then buying the right one is critical. What may be good for others, can be awful for you. You'll learn how to match your strengths to a business that is absolutely right for you and avoid the ones that aren't.

How to Buy The Right Business For You

According to industry statistics, over 90% of the people who begin the search to buy a business NEVER do!

The only way that you'll avoid being a 90-percenter is by acquiring the right knowledge. Likewise, the only way to ensure that you will be successful in the business is to be absolutely certain that you buy the right one.

Don’t be alarmed, most people have no clue what business is right for them. The number of businesses for sale can be daunting; the choice is enormous.

There are many proven steps that can help you determine what is the right business for you.

Develop YOUR Golden Rules:

Put together your list of five golden rules of what any business you buy MUST have in place. Think about this and be specific. Don't say: " I have to enjoy what I do"...sure that's important, very important in fact. However, if you're in a business that you initially think you're going to love, but you find yourself losing money, I can assure you that you'll learn to hate everyday very quickly!

As an example, here are my five golden rules for any business I consider buying:


1. It must be a sales and marketing-driven business - that's what I do best.

2. It must have some element of exclusivity either in the product or within a territory. If not, I have no point of difference to offer new clients and maintaining current clients will always be a risk.

3. The product or service must be a high-margin item - this way, it's simply a matter of time, persistence, and sales savvy (my strength) for me to build the business. Plus, the margins will allow me to try new, creative ways of building the business.

4. There must be built-in demand for the product or service. I've learned the hard way that trying to create demand is far too expensive.

5. I do not want to sell anything that competes solely on price. There's no long-term viability in that business model.

These are my rules. Unbreakable. Non-negotiable - no matter what! Guess what? They are bulletproof. When I find a business with these in place, and there are plenty, I am always going to be successful. You can certainly follow mine, but I will also show you how to modify them to find the business that makes perfect sense for you.

I must admit that I do have a sixth and seventh rule, but they are negotiable: I like businesses that don’t have a lot of employees and I prefer, if possible, to have a business where there are repeat orders from all clients. But again, I will sway from these two but never, ever from the other five.

Helpful hint: you probably won’t come up with five today. Your list may even change a bit during your search. As you visit different businesses, speak with sellers, and conduct your research, you may discover certain things that are added or deleted from your list. That’s OK. However, getting this list down pat as soon as possible is fundamental to your success!
"Whatever It Is That You Do Best"

Next, get a true grip on your skills. Don’t pretend to be something that you’re not. The rule here is that whatever it is that you do best (sales, marketing, operations, etc.), must be the single most important driving factor of the revenue and profits of any business you consider purchasing. Repeat the last sentence once again; it holds the key to your success!

With business ownership, one of the main goals is for you to control your own destiny. Don’t put yourself in a position where if one employee leaves, you’re in big trouble. Your skills must be the fuel that drives the engine.

The right business for you is one that will thrive from your strengths and not suffer from your weaknesses. Take a long, hard look at yourself. Picture yourself in the business. Of paramount importance is that you must perceive yourself as enjoying the business. If you can’t, then there’s just no way that you can be successful. The business that you choose has to be one that you’ll be proud to own.

Fall In Love With The Profit NOT The Product!

Another key factor is to avoid falling in love with the product; rather, you must fall in love with the profit and the lifestyle that it can deliver to you. Many buyers begin to dream about all of the exciting things about the business and they become delusional about what can realistically be achieved. The product that the business sells, or the service that it offers, unless offensive in nature, is meaningless in the overall scheme. If the business does not produce the income you need, or provide you with a satisfactory return on your investment, then rest assured, you will learn to detest the product quickly.

Likewise, a bland, boring product line can become very attractive if the business is growing and you’re enjoying the work.

Stay Focused - Don't Get Discouraged

During the search phase, it’s easy to become discouraged by the vast number of available businesses. Don’t get overwhelmed. Approach this methodically. If necessary, rule out the ones that you don’t want. For example, if you're not interested in a gas station, restaurant or convenience store, you'll rule out 50% of all online listings. Search through listings paying attention to the profits, not just the asking price. Understand that listings do not always portray the whole picture. Send inquiries to the listed contact. Arrange meetings with sellers. Prepare the questions you need to ask. You cannot buy a business from a listing. Visit businesses. With each meeting you’ll get closer to knowing what is and isn’t right for you.

Above all, get into the game. Once you own the right business, you’ll never look back!

Copyright 2001 – 2007 by Diomo Corporation Richard Parker. All rights reserved.

NOTE: The articles that appear on this website are the sole and exclusive copyrighted property of Diomo Corporation and or Richard Parker and may not be reproduced in any format whatsoever without the express written consent of Diomo Corporation and Richard Parker.

Related Articles

Article Tags:



Related Forum Posts
My entry - 1. The Best Business Books Ever: The 100 Most Influential Business Books You'll Never Have Time to Read - this is a fascinating book about the history of Business theory, and I'd recommend it to anybody. 2. The Big Book of Small Business: You Don't Have to Run Your Business by the Seat of Your Pants, by Tom Gegax. Ditto. 3. PADI: The Business of Diving Book Okay, so this book won't be of use to anyone who doesn't want to start a scuba store, but I did, and this book was of course invaluable to me in reaching that goal.
Exclusive: Interview with Results - Hi Forum Members, I'm helping start up a Business Coaching and Consulting company here in Toronto, Ontario, Canada (a Subsidiary of RSC Business in Los Angeles). As a Research and Development Intern I am required to practice my listening and interview skills by surveying Small and Medium Businesses on thier Business. This Survey is designed by RSC Business to also assist the Business being interviewed more insight into their own business. I am looking to interview about 30 businesses across North America over the span of 3 months. At the end of these interviews I will be publishing a report of the results and they will be made available for free to the Interviewees. The Report data will include responses from a minimum of 100 interviews. I would like to extend this opportunity to members of the Forum. If you would like to have this short 20-30 minute interview conducted on your Business and you reside in North America please send me an email or PM. Please contact me at andy[at]jvprosperity[dot]com to arrange our interview and to get free access to the results when they are published.
Re: HOw to market a B2B consulting company - [quote="zohahunt77":428owzbi]Hi, I was wondering if anyone can tell me the difference between B2B and B2C. I don’t know about b2b marketing but I have done marketing so know things about it. I will suggest you to take online services which will spread your business all over web network. Online marketing is the best way to market any business.[/quote:428owzbi] B2B = Business to Business - You are marketing to other businesses. B2C = Business to Consumer - You are marketing to consumers.
English teachers learn Japanese as Interns - Yasunori, what about the many students that leave N. America to teach English in Japan. They may want to learn Japanese (maybe Business Japanese is a bit different) and the Japanese Business Culture.
New Study - Women prepare better business plans - I found an article in Business Week and I found this quite interesting. [quote:ka7lg35i]Who Prepares Better Business Plans, Men or Women? A new study based on four years of data from men and women in a training program for microenterprises finds that they come out the same in quality scores. "However, women scored significantly better on the presentation of their plan to judges," conclude the study's authors, Ronald G. Cook, Paul Belliveau, and Christine Lentz of Rider University, in a paper presented at a recent meeting of the Small Business Institute. [/quote:ka7lg35i] What do you guys think?


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Tweet

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

The five pillars of internet marketing strategy

Providing Feedback

Induction – your first management job

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.