When reading the statistics concerning the lifespan of start-up businesses, a prospective entrepreneur may begin to feel discouraged.  There is a general understanding that only about 20% of brand new businesses will make it to a six year anniversary.

Most new businesses fail in their first few years for a variety of reasons.  Many new business owners invest too much initially in the start-up of the business, not leaving enough funds for the time before they begin to turn a profit. Some new owners try to expand their businesses long before they should, leaving a huge financial stress on the business.

Whatever the reasons for failure, the number of brand-new businesses that just don’t make it may intimidate a prospective entrepreneur.  There is an option, however. A prospective entrepreneur can buy an established business.

For a first-time business owner, an established business can be very attractive.  An established business has already been through the unstable early years and has proven itself in the local market.  It can be part of the purchase negotiations that the former owner stay on for training purposes until the new owner is ready to run the business on their own. The business will typically come with an inventory, and the location will already be equipped with the necessary furnishings and equipment. Many existing businesses come with a rental agreement with the property owner already in place.

The purchase of an existing business gives the new entrepreneur the chance to go into business for themselves without having to start from scratch.  This is not to say that purchasing an existing business is without risk.  Any business venture comes with some degree of risk, and it is the job of a prospective buyer to weigh those risks against the benefits of business ownership.  If this is your first step on the road to becoming your own boss, then perhaps the option of purchasing an established business will be the right choice for you.

Michael Monnot

941.518.7138
Mike@InfinityBusinessBrokers.com