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SVTPerformance's Chain of Restaurants
Road Side Pub
Buying an existing business
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<blockquote data-quote="JPKII" data-source="post: 16686439" data-attributes="member: 12867"><p>I'd add to the above great advice. This may be more on the side of negotiation rather whan "what to look for". </p><p></p><p>Often times I see former owners have their final payments for the business tied to performance objectives/criteria you both create and agree to (including a timeline). That way the former owner is tied to his promises and is (nearly) equally motivated to see you be successful. Don't suggest a performance hold-back until you have a price for the business on the table. If you put this out too early, they will raise the price to ensure their risk of the performance hold-back is covered.</p><p></p><p>Prior to putting a business up for sale, I've seen folks drop product prices and give crazy warranties in order to increase their backlog and sell the business at higher values. New owner walks in and half of what he has is a paper tiger (and a bunch of angry new clients). Ensure you know what your warranty liabilities are going to be.</p></blockquote><p></p>
[QUOTE="JPKII, post: 16686439, member: 12867"] I'd add to the above great advice. This may be more on the side of negotiation rather whan "what to look for". Often times I see former owners have their final payments for the business tied to performance objectives/criteria you both create and agree to (including a timeline). That way the former owner is tied to his promises and is (nearly) equally motivated to see you be successful. Don't suggest a performance hold-back until you have a price for the business on the table. If you put this out too early, they will raise the price to ensure their risk of the performance hold-back is covered. Prior to putting a business up for sale, I've seen folks drop product prices and give crazy warranties in order to increase their backlog and sell the business at higher values. New owner walks in and half of what he has is a paper tiger (and a bunch of angry new clients). Ensure you know what your warranty liabilities are going to be. [/QUOTE]
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SVTPerformance's Chain of Restaurants
Road Side Pub
Buying an existing business
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