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More Than 40 Years Of Legal Service To The Baton Rouge Region

How to evaluate an existing business for sale

On Behalf of | Feb 22, 2019 | Buying Or Selling A Business |

There are a variety of businesses for sale in Louisiana and throughout the rest of the U.S. An entrepreneur looking to operate their own company may find it more beneficial to purchase one of these businesses as opposed to starting their own from scratch. This is because an existing company has a track record of success (or failure) that a buyer can evaluate. Furthermore, the company might have brand recognition or intellectual property that can be valuable as well.

Buyers may believe that businesses are put on the market because they aren’t worth keeping anymore. However, most companies are sold simply because the current owners prefer to do something else with their lives. Of course, buyers will need to do their due diligence before deciding that a company is worth purchasing. Ideally, it will have inventory, an enthusiastic customer base and a place where it can do business for the next several years.

Those who are seeking to purchase an existing organization will need to determine if they want to keep existing employees. If the answer is yes, it will be necessary to keep them informed about how new ownership could impact how they do their jobs. Finally, be sure to review any loans or other debt obligations a company has. After all, a buyer could take these debts over upon purchasing the business.

When buying or selling a business, it is important to review the terms of the proposed deal. This may be done with the help of an attorney, an accountant or both. It can also be a good idea to talk with employees or others who are associated with the company for sale. Doing so could provide important information to use when determining whether to close on a deal.