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22 Aug

The Big House Presents: EXPO

EXPO is a great opportunity to discover what with these businesses to localise your supply chain, reduce your carbon footprint, and create jobs and opportunities in the D2N2 area.

20 Aug

Chamber offers free year-long membership to businesses affected by Toddbrook Reservoir incident

East Midlands Chamber (Derbyshire, Nottinghamshire, Leicestershire) continues to work with partners to offer comprehensive support to local businesses which have been - and continue to be - affected by the potential collapse of Toddbrook Dam.

19 Aug

‘Energy for Business’ scheme helps local businesses make the low-carbon leap

A project which helps local businesses that want to develop low-carbon solutions, has been awarded funding to support SMEs in the region for another three years.

Considering Starting a Business? Why Not Buy One Instead!

Sometimes, starting your own business from scratch is not the best approach for budding entrepreneurs. In fact, with a significant proportion of SMEs doomed to failure within the first 5 years, it can seem like something of a losing bet to many. However, there is an alternative to building from the ground up, and buying a business provides savvy CEOs a chance to get a running start within their chosen industry. Here, we take a look at how buying a business might be a better option for you than risking it all on a startup.

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Starting your own business can be intimidating. There's so much to think about, from sourcing funding to the finer points of product distribution and everything in between. Of course, it can be exciting and engaging, however, it can also take its toll both financially and psychologically. There is another way, however, and that is to eschew the usual trials and tribulations of the startup scene and buy a fully formed business already in existence.

Strangely, buying a business is very often overlooked as a potential career path, despite the proliferation of businesses for sale thanks to increased exposure through online marketplaces. Many people simply assume that, to realise their own ideas using their own methods, they will need to build something from nothing. That is to say, being one's own boss is almost always associated with taking a concern from inception to completion. Whatever the reasons for this, it's clear that buying a business does not usually carry the same glamour or sense of accomplishment for many entrepreneurs. However, if you can avoid falling into this trap, then there are huge benefits for owners who are willing to buy a going concern rather than start a business from scratch.

Improve Your Chances of Success

First and foremost, buying a business greatly improves your chances of success - particularly if it has cleared the 5-year hump. Assuming you have done your homework and the business you would like to buy is running smoothly, you will find that almost all the hard work has been done for you. This means that, aside from the initial setup and operation, the business should also have comprehensive procedures in place and strategies to help it move seamlessly into the future.

Naturally, these can be altered or scrapped entirely after you have made the purchase. The point here, however, is that the previous business owner was progressive and forward thinking enough to prepare plans well in advance. This instantly tells you that this particular SME is primed for future success, and any past profits are likely to be replicated in the coming years.

In addition to the future of your purchase, you can also expect an immediate payoff not often achieved when starting your own business. A successful business means instant cash flow, and regardless of its size, this should never be underestimated. In fact, living without disposable income year-on-year is one of the major contributors to fledgling businesses failing. Entrepreneurs not used to the squeeze simply cannot manage without a regular source of income.

Take Advantage of Existing Assets

Looking deeper than mere profits and potential growth, there's plenty more to enjoy when buying a business. Take for instance the sheer choice of existing businesses on the market at any given time. Whatever your industry or sector, whether you cater to niche or mass markets, you are sure to find a business that not only fits with your plans but also allows for your own ideas to be implemented using existing assets.

This means that you can take an existing business and encourage growth with the introduction of new products and services by harnessing existing assets such as customers, contacts, suppliers, equipment and perhaps most importantly, brand recognition. This type of launchpad for your own ideas is out of reach for the majority of new business owners and allows you to test out new things with much less risk than relying on the barebones of a startup.

Any staff members that come along for the ride after you purchase your new business will almost always become great assets too. Well trained and knowledgeable staff can give you insights, not only into the way your new venture operates but also into the wider market. This means that you can draw upon an instant well of experience not usually available to startups. This will help you manage both day-to-day operations and also plan for the future in a competitive market.

Buying a Business – Closing Thoughts

It's clear then that there are plenty of benefits to buying a business, and if nothing else, we hope this article has opened your eyes to the possibilities. Of course, on the downside, you will usually need a large amount of capital to buy a business in the first place and be prepared for any hidden issues that present themselves after the purchase. However, there's little else standing in your way to developing a purchased business in your own image.

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The above blog has been kindly supplied by the above mentioned author. The inclusion of this content and any links to another web site, or any reference to any product or service by trade name, trademark, manufacturer, or otherwise, does not necessarily constitute or imply an endorsement or recommendation by D2N2 Growth Hub.