Buy
a Business
At Business Connection
International we try to make the experience of buying a
business as fulfilling as possible. Whilst you should remember
at all times that we act for the vendor and hence cannot
act for the buyer at the same time, we do endeavour to make
the process as satisfying for the buyer as possible. The
buying process is broken up into many stages:
- Interview
at our Office
- Inspecting
the Business
- Negotiation
- Substantiation
- Contract
- Handover
Interview
Initial
Contact
You
call us to inquire about a business and to set up an appointment
with one of our brokers.
Background
Information
You provide us with information about yourself, such
as a resume and financial statement. The more we know about
you, the more likely it will be that we can find a business
you will like. It is possible that we may not be able to
show you the business you want at your first visit but the
more information we have, the easier it will be to find
the right business for you.
Confidentiality
You sign an agreement promising to maintain the confidentiality
of all the information provided to you about the business
or businesses we discuss with you.
Inspecting
The Business
Review Information
You and our broker review various types of businesses
from our inventory and select those businesses that appeal
to you. You will be given information about those businesses
and an invitation to visit the premises and observe the
business unofficially.
See
our Businesses For Sale now
Personal Inspection
You will inspect the business and review the summary
information we have in our possession. If you wish to take
a closer look or speak to the vendors, that can be organised
- usually after hours and when staff are not present.
Contract
Offer and
Negotiation
If you like what you see and hear about a business
and wish to proceed with a purchase, you make an offer
which is subject to satisfaction about financial, lease
or any other matters. This offer will be relayed to the
vendor and negotiations on price and other material terms
can commence. The offer can be made subject to substantiation
of the vendor's claims about the business.
Deposit and
Contract
Once the offer is accepted we proceed to draw up contract
terms or send the terms to the vendor's lawyer who will
prepare contracts. With the accepted offer, a deposit is
paid into our trust account where it is held until settlement
of the sale. This deposit is refundable to you until contracts
are exchanged.
Substantiation
Records
You, in company with your accountant or business adviser,
then arrange to inspect what records or other documents
are open to you in order to substantiate the facts about
the business.
Trial
Another way to verify or substantiate facts is for the
vendor to offer a trial. This is a procedure where the vendor
agrees to allow the purchaser to personally attend at the
business to verify facts, usually the takings of the business.
This procedure takes place after contracts are exchanged.
Handover
Once the business transaction has been completed, you
are entitled to take over the business and commence receiving
the profits.
The contract
can provide for a period of training where the vendor will
introduce you to the customers and suppliers, and will train
you in the operation of the business.
A Tip
In our experience the main reason for failure in purchasing
a business is the buyer's failure to do his or her homework.
The person leaving a business will generally know more about
the business than the person coming in. You as purchaser
must redress this imbalance. You must do your research,
giving yourself a better chance of success.
You must :
- Observe the
business as well as its records
- Ask yourself "Can I see myself operating this business?"
- Accept that
it will be harder than it looks
- Do more research
than you thought necessary
- Leave emotion
and ego out of the equation
- Always leave
a percentage of capital in reserve, usually 5% of purchase
price.
Who
Can Help Me Buy a Business?
Business Connection
International can act for you on the purchase of a business,
just as we act for the vendors of businesses. We can inspect
the business, conduct due diligence and help negotiate the
price. Of course, this relates to businesses other than
the ones where we act for the vendor. We can only do one
or the other.
If you see a
business you like, or have an idea of the business you would
like, contact us with your details.
If you feel you
could be assisted by this service contact
us now.
You can also
contact us at our office:
Shop
3, 1 Alexander Street
CROWS NEST NSW 2065 Australia
Telephone (61 2) 9439 3399 Facsimile (61 2)
9438 5577
email sales@bc.com.au
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