If you are thinking about starting a business as an investment, you might consider buying an existing business. A business started from scratch has its own charm, and brings the adrenaline of the challenge of “everything to do.”
On the other hand, buying a business that is already established and working has advantages worth considering. The services and / or products are already accepted. There is a client base that allows you to start above or near the “break even” point.
If you choose this second option, buying an established business, there are important elements that must be taken into account when taking ownership of a company. Here is where a commercial law lawyer will be very useful.
What are the advantages of buying an existing business?
As mentioned before, there are a number of advantages to buying an existing business instead of starting a completely new one.
First of all, an existing business has an integrated portfolio of clients. You do not need to worry about the initial investment that comes with introducing your brand. Plus, you have the right to access the financial statements of the company. And thus have a better understanding of the financial situation of the company that you would be taking over.
Here, the interaction of an accountant and a commercial lawyer will be essential since there could be hidden problems that only the professional and experienced eye can detect.
Returning to the consideration of advantages, we can say that there are many small businesses that fail because they do not have enough cash to go through all the first months of business. However, when you buy an existing business, you start with all these elements overcome. Infrastructure, inventory, equipment, employees, intellectual property …
Naturally, when considering a business to buy, it will be important to carry out “due diligence” in order to understand why this business is currently for sale and what to be aware of to prevent any problems that could be faced in case of carrying out the operation, such as commercial debts, legal problems, obsolete equipment that would increase production costs, etc.
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Regarding the legal aspect, it will be very important to review laws and legal documents, as well as to review real estate contracts, evaluate the letter of intent and draft an appropriate sales agreement.
Our team of business lawyers in Miami, Fl will be able to advise you on each of the necessary steps to acquire a business.