What Are the Benefits of Buying an Existing Business vs. Starting a New One?

Dec 4, 2010

Have you been thinking about starting a business of your own, but you’ve been scared away by the economic crisis?  Instead of assuming the risk of a new venture, why not pick up where someone else is leaving off?  Considering the benefits of buying an existing business, it is no wonder they are selling so quickly.

  • When you buy an existing business, you save an enormous amount of time and energy because there is no need to write a business plan, research demographic trends, scout out locations and hire staff. 
  • Also, if financing is needed to buy the business, it is much easier to get buyer assistance from the owner than it is from a traditional bank.  But if you do need a bank loan, lenders are more likely to say yes to a proven business than a startup.
  • Another one of the benefits of buying an existing business is the existing relationships with customers, employees and suppliers.  You won’t need to rush out and buy new equipment (yet) and you will benefit from being able to ask questions of the current owner.
  • If generating an immediate income is important, then buying an existing business is a smart move, since the business is probably already generating revenue enough for an owner to earn a salary.
  • Another important benefit of buying an existing business is you inherit the infrastructure established by prior owners, which makes the transition to business ownership much easier.  Infrastructure can include company handbooks, employee benefits, customer contracts, leased equipment, computer systems, and much more.  If you were to start a business of your own, these things would not already be in place. 

For a complete list of existing business for sale, consider this online resource for businesses for sale by owner.  BizSale.com gives you direct and immediate access to sellers across multiple business sectors.