Have you always dreamed of owning your own business? What’s your motivation? Do you dislike what you’re doing now? Do you dislike your boss? Do you dislike having a boss? Do you like dealing with customers? Do you have a nest egg you need to invest? Or are you looking to build one for your future? Taking the leap can be very scary, definitely challenging, and possibly rewarding. Consider the following questions, they all must be addressed to make business ownership possible. If you aren’t comfortable sharing these things, you may have to quickly overcome that discomfort. Understanding the following questions will help you deal with with prospective sellers, financiers, and business brokers.
- What do you know about the industry the business you’re buying is in? Is it in an uptrend? Downtrend? Neutral?
- Does the business you’re buying have positive cash flow?
- Is the business you’re buying profitable?
- Has the balance sheet grown year over year, or have they sold off assets?
- How long has the business existed, and when was its best year?
- How long did the people who are selling own the business?
- Why is it being sold?
- What kind of training will you need to run the business?
- Does the business run owner managed or manager managed?
- If Owner managed, what responsibilities does the owner have now?
- Have you managed a team before? In what capacity?
- What HR experience do you have? Hiring/firing? Recruiting?
- What do you know about insurance? Workman’s comp, liability, commercial auto, employee dishonesty?
- Does the business require any special licenses?
- What is your current financial situation? Barely getting by, Saving a little, Saving a lot, I have substantial net worth above my needs, I am retired and this would be something to do? Other?
- Will you need a loan to purchase this business?
- If you buy this business and cannot take any salary or income for 12 mo, 24 mo, 36 mo how would it affect your lifestyle?
- If the business required an additional cash contribution to cover losses in the first year or two, in addition to not having taken salary, do you have reserve funds for this, and if not what is your plan to cover it?
- Who is your support system for decisions making? Who do you bounce ideas off of?
- Have you ever had a side hustle? What did you do? Did it grow? Why did it stop?
- Does your partner/significant other/family support your wanting to venture out into the small business world?
- If the business fails, what will you do?
- Are you a people person? Can you resolve/diffuse conflict?
- Will having to appease staff or customers irk you?
- Do you typically learn from your mistakes? How do you improve/grow?
- Have you ever written a business plan?
- After reading all these questions do you still want to learn more about buying, owning and operating a business?
Now that I’ve laid out all these questions, the next step would be to talk through the answers, and see if my style is a good fit for your personality. My consulting/coaching services are offered because I enjoy seeing people succeed, but I do not work with most of the people who contact me. Many people ask why someone who charges as much as I charge wouldn’t want to collect as much money as possible from as many people as possible. Simple answer: I don’t need the money, working with new business owners and helping them grow is something I enjoy, and if I’m going to work with someone, it has to be fun and interesting for me, and I have to believe they are capable of succeeding by both their and my metrics. If you’ve read my bio, you know I’ve owned dozens of companies, most of which have succeeded, some which have been “pushes” or breakevens, and a few that have failed. I’ve learned far more from my failures than my successes, but if my clients are going to fail, let the failures be small, and the lessons be big so that we can succeed.
As always you are welcome to contact me through my webform, and we can see if we might be a good fit.