6 Factors to Consider When Buying a Business vs. Starting One!
We had to re-blog this great article published on LinkedIn by Corey Goldstein. We believe it is very informative for potential and existing BizON members. Hope you enjoy the read as much as we did! Here you go:
Many factors come into play when considering buying a business versus starting one. I get pitched on investing in or starting new businesses nearly every day and the majority of them are really great ideas and lack the integral structures for long term success.
These are the six key factors I look at to begin considering building or investing from the end in mind.
How do I want this to look?
Do I want to sell this business or do I want to keep it as a cash flow lifestyle business?
1) Remember that the primary objective for going into business is to produce income. How much are you looking to produce? How quickly do you want a return on your investment?
2) Do you prefer a ‘ready-made business’ or blueprint versus creating something from scratch? Some people are really great at starting projects although have a very difficult time in actually completing them. If you’re a person who has challenges completing things you may want to consider staying with a ready-made business, such as a franchise.
3) You don’t have any kind of problem or issues following policy developed by other people – If this is this the case, you may want to consider buying an existing business that has a series of processes and procedures already established. If you’re a trailblazer and you want to create your own policies, procedures and measures of success, consider the additional time investment and potential added costs when considering your evaluation.
4) You prefer to do something proven and start something new – This is a great low risk idea! Low risk typically doesn’t build wealth quickly, it can build over time. So if you’re looking for safety with your capital this may be a good approach for you.
5) You prefer turning to others in times of stress instead of keeping things to yourself – This opens up a whole conversation about mentorship, coaching and performance. Having a team of people to consult with, is the very nature of good business. No person can know everything and in the moment that you think that you do, you may receive an expensive learning lesson.
6) You prefer working with a system to being completely independent – without integrity nothing works. One must have a system in place to be effective, however simple or complex.
I remember when I was little boy selling lemonade from my front yard. The simple system I had made sense. Does the business that you’re considering purchasing or starting have easily replicatable systems or do they require high-level, critical thinking systems to be installed and put in place?
Before you make your move on your next business, consider how you know yourself to best work. Are a self-starter but lack follow-through? Are you an ‘independent’ or a team builder?
Discover your talents in advance. Make a full and complete assessment of the assets you bring, then build from there.
Corey Goldstein is the author of “What Would Richard Branson Do?” and the founder of www.FixMyReport.com
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