Steps to acquire a crossing or to buy a business
16 April 2009 - 18:06
To acquire a crossing consists of buying a business or company that at the moment is in operation.
Usually it is alternative of a safe and simple, but, on the other hand, expensive business.
Between the advantages they are the possibility of avoiding some stages in the creation of a business, power to save time and energy, power to count on an established base of clients, and to be able to count on a name or trade name already recognized.
Between the disadvantages they are the high cost that implies, the possibility that the business can have hidden legal or financial problems, or the possibility that the previous owner initiates a competition.
Generally, a crossing involves small businesses that are constituted like natural person, reason why is not necessary to have to make the change of owner in the registries public, but simply cash can be done the crossing through the company/signature of a deprived contract between the owner of the business and is going that it to acquire.
We see next which are the steps necessary to acquire a crossing:
1. To decide the type of business that we are going to acquire
In the first place we must determine which will be the type of business or company that we want to buy.
For it we can be based on our experience, in our capacities, knowledge or in our pleasures. But also we must consider if it is a type of profitable business, considering the present situation and the tendencies that are occurring in the market.
2. To look for the business
Secondly we happened to look for the businesses or companies of the type that we want, that they are on sale.
For it we can look for in the classified warnings of the newspaper, in those of Internet, ask well-known friendly or, look for the council or professional attendance of some specialistic agent in the subject, or simply to contact to us with some business, and communicate our intention to them to acquire it.
3. To determine how much it is worth really the business
Once we have found the potential business to buy, we must consult its price, and evaluate by our own means if business really is worth what the owner asks to us.
In order to find the true value of the business, we can investigate the price average of market of other similar businesses, or look for the consultant's office of some specialist.
Another form to determine how much it is worth a business, is to divide the amount of the net utilities that we hoped to obtain, between the rate of return that we hoped by our investment.
For example, if we calculated that him business will generate utilities net of annual US$30 000 (for example, analyzing its historical financial statements), and have considered that less than we can obtain by our investment is a return of 16%: (30 000/0,16 = 187 500), then US$187 500 would be the amount that really is worth in business, and which we would have to offer.
4. To investigate the business
Before deciding to us to acquire the crossing, we must investigate or all referring to the business or the company to buy, must investigate legal aspects, as well as accountants and financiers.
For example, we must analyze the financial statements of the business (which the salesman is forced to show us it), we must investigate if it is up-to-date with the payment of taxes, if it counts on operation license, etc.
In order to be safer with this investigation, he is recommendable to contract the services of some audit.
Another important aspect in case we are not buying the property of the premises where the business works (but only the business), is the necessity to analyze the renting contract well that we will have to sign with the owner of the immovable property.
5. To negotiate the price and financing
In case we consider that the price that the salesman requests (owner of the business) is very lifted, we can have a discussion with him, and try to negotiate this price.
For it, we do not have to doubt in showing the information to him that we have collected, our projection of the utilities, the rate of return that we hoped to obtain, and the amount that we have concluded that is worth the business.
Also, we must negotiate the financing, generally, the salesman will provide part with the financing, having allowed to pay a part us of the crossing in cash, and to pay the rest during a period of determined time, although being able in some cases, to ask for some guarantee to us for it.
We must have a discussion with the salesman to negotiate agreements that are beneficial as much for him as for us.
6. Company/signature of the contract
Once we have reached some agreement in the price and the financing, and decided the crossing, the hour has arrived to sign the contract. For it is not necessary to count on the physical presence of a public notary, but we want you are safer, we can take the contract some, so that it legalizes the companies.
An important aspect in the crossing contract, is that in him all the physical equipment, equipment, accessories and other elements are due to indicate retail that belonged to the old owner of the business, and which now they happen to be of our property.
7. To update information of the business
And, finally, once acquired the crossing, we must update all the information that is necessary to give account of the accomplishment of the crossing.
We must, for example, to communicate the crossing celebrates to it of taxes in order to update our data like contributor, and to communicate with the municipality in order to solicit from them that they change the name of the holder of the operation license.
Labels: Creation of businesses, Step by step
Compártelo
Related contents:
- To rent or to buy the commercial premises
- Steps to set up a company
- Alternatives to initiate a business
- Crossings of businesses
- Advantages and disadvantages to acquire a tax exemption
