Blog for Business Buyers and Sellers

As it becomes more and more difficult to get a business loan from traditional lenders, many entrepreneurs are looking to non-traditional sources for business financing.  While some people consider their 401K or IRA investments a “sacred cow”, others see it no differently than a convenient self-funded bank.  If you approach buying a business with your 401K in the same way as a bank loan, complete with interest payments, it really can be a reliable source of financing.  The only problem is the risk that your business could fail, and then you would need to continue repaying your loan with interest. 

Are you passionate about the environment?  Are you itching to start our own green business to serve the needs of your community?  A number of would-be entrepreneurs are looking for a green business for sale by owner as an alternative to starting from scratch.  Not only are existing businesses a lot easier to manage; when you buy a green business for sale by owner, you can get much more favorable financing terms than you would as a start-up. 

The economy may have kept you from pursuing your dream of starting a green business, or perhaps you haven’t yet found a good source of venture capital, but any entrepreneur will tell you -small business loans for brand new businesses can be hard to come by these days.  One of the primary advantages of dealing directly with the owner is the potential of seller-assisted financing.  Another reason to deal with the owner is to get more insight into the daily operations of the business, and determine if it is really a good fit before investing.

If you are an entrepreneur, one of the hardest things that you will ever do is to put your business up for sale.  Even if you are retiring or moving on to a new venture, you have poured a lot of time and energy into making your business a success and you will want a good return on your investment.   This is where a good business broker can help.  Not only will they take over the marketing of your business to potential buyers, they will help calculate the appropriate selling price and respond to any offers, freeing you up to run the day-to-day operations of your business.

A business broker is a lot like a real estate broker, in that they match up buyers and sellers of businesses, but a good business broker will also help you get the maximum dollar value.  That’s why it is so important to hire the right one.

We’ve all heard about the big-name companies that owe their success to an enterprising spirit and good timing.  Were it not for their ability to see an opportunity and seize it, they may not even be here today.  You may have started out your business by buying an existing business and managing it well; or perhaps you started your business from scratch.  Either way, the key to continued growth in your industry may only be possible by buying another existing business. 

While the U.S. economy continues to sputter, it is difficult for business owners to know how to evaluate the value of an existing business.  There are three basic approaches that can be followed when valuing a business, so it’s important to choose the right one for your industry. 

Asset Based Approach: An asset-based approach is where the value is derived from the costs of tangible assets, or the replacement value of such assets in similar condition.  This approach is best used when the earnings of the business won’t support a greater value than its tangible assets. 

Page 20 of 29

Click to contact us for help buying or selling a business.  Since 1980 we have been in the "business of business." We are a professional company specializing in bringing For Sale By Owner Business Buyers and Sellers together. Being one of the Nations leading firms in our industry, we are best equipped to help you because of our background and years of experience in working with business buyers Nationwide and businesses of all sizes and types. Your business purchase or sale information will be handled by experts and conducted in a confidential manner.

Blog Topics

All articles by