- Posted March 2, 2014 by
10 questions to ask yourself before you buy a business
1) 1. Are you suited to running your own business?
While some people like to be in control of their routine and thrive on the challenges of running their own business, others prefer the comparatively structured and secure environment that paid employment can provide. Which are you? Weigh up the pros and cons before deciding to go down the route of business ownership. To run a business successfully, you need to be able to motivate yourself and others.
2. Do you have a particular business in mind?
You might already have a specific type of business in mind, or you may simply like the idea of being your own boss. Consider your personal interests and hobbies, as well as the types of business available.
3. Do you have the necessary skills and experience to run a business in a particular field?
If you have experience in a particular area then that is a plus. If you don’t, you will need to conduct some thorough research in the area.
4. Do you understand your strengths and weaknesses?
As well as your skills and experience, it is important for any prospective business owner to have a sound understanding of the general areas in which they excel and those that they may need assistance with.
5. Are you an effective manager of people?
You don’t need to be an experienced manager to take on a new business, but it helps if you have some idea of your capacity to manage people. Are you able to deal with potential problems that may arise, for example, employee issues or falling sales? If finances allow you can hire a manager, but this may not always be a financial possibility, at least not to begin with.
6. Are you comfortable with taking risks?
Any prospective business owner needs to be comfortable with the idea of risk. Even under favourable circumstances, owning your own business can be a disquieting endeavour.
7. Do you have the finance to buy a business?
Whether through a loan or other options, you need to be able to raise the necessary finance. Are you in a secure enough financial position to be able to buy a business without jeopardising your personal circumstances? What are the financial options available to you? Are there businesses available for sale within your budget? Can you sustain a period with little or no income?
8. Are you constrained by personal circumstances as to when you can and can’t work?
Running your own business doesn’t always tie in with working regular office hours, Monday to Friday, 9-5. Are there any times that you are unable or unwilling to work? You may not be able to work evenings or weekends, for example.
9. Are you prepared to put in long hours?
Many people go into business by themselves thinking that they will have more free time and more leisure to spend pursuing other interests. Unfortunately, it doesn’t always work like that. Many new business owners find themselves with complicated schedules and less free time than they had previously.
10. Are you willing to do your research?
Once you have identified the type of business that interests you, you need to start researching it thoroughly and methodically.
I.B. Capital Management