How to Buy a Business â€“ Remember to Run the Business
Once you own the business, it is important to remember that the figures presented to you by the previous owner, were a record of his achievements in the business. They have no magical life of their own, and will only continue if you continue to operate the business.
The business can be seen as a car. It will only move if you drive it, and it will only avoid the inevitable obstacles that will come your way if you operate the steering wheel and controls accordingly.
I remember an ex Bank Manager who purchased a Fruit Shop. After the first month, he complained that the previous owner had lied about the figures. Even though he had conducted due diligence and a trial to verify the figures, the previous owner "must have faked them", because the business was now doing nowhere near the figures quoted.
I approached the previous owner about this. He told me he had indeed lied about the figures â€“ the real figures were actually 10% better than he had let on.
The problem, he explained to me, was "you must-a sell-a da fruit". Where the new owner was sitting in his office watching and fretting about the figures, the previous owner had been out the front of his shop urging customers to "buy-a the lovely tomatoes".
Click here to search our Businesses For Sale.
Click here to return to our Buyer's Guide.
Article written by Rudy Weber. Published with permission from Rudy Weber, Lloyds Business Brokers.