Lisa Riley, Ph.D., CBI, CBB
Principal at LINK Business
START UP COSTS ARE HIGH
Starting up a business usually entails a large outlay of cash for expenses several months before a single dollar is ever earned. Some common expenses include: location, tenant improvements (TIs), furniture, fixtures, and equipment (FFE), marketing, advertising, product development, employees, office manuals, creating systems and processes, deciding on a merchant service provider, insurance agents, security firms, payroll processors, etc.
When buying a business, you simply take on the assets and have a proven market for the product/service your company will be providing. Most of the time, this includes customers or clients and revenue coming in on Day 1.
STARTING A BUSINESS A HUGE RISK
Although buying a business is no guarantee that you’ll be successful, when you compare the risks involved with starting a business to buying one, you’ll see the risks are lessened. As long as you do your research, buying a business means someone else has already taken on the high risk. When buying a business, you have a proven market for what your company will be providing.
Unless you have a very unique idea or thrive taking risks, the stress of trying to start your own company may not be worth it. Buying and running a business will provide enough risk for most.
YOU CAN USE A PROFESSIONAL LINK BROKER
Want to cut down on your risk even more, get a LINK broker involved. A LINK broker will assist you in order to acquire the best possible business for your investment and one that matches your goals as well as your personality.
Business startups do not have the same type of service available. You can ask around, hire a consultant, and/or read books about how to start the right business for you. If you can find someone who will get paid to help you make that decision and guide you through the startup process, please let us know. We’ve yet to find such a guide.
BUYING A BUSINESS IS EASIER
Buying a business basically means you get the recipe for success. You’ll potentially receive everything, including but not limited to: leased space, furniture, fixtures and equipment, clients/customers, suppliers/vendors, employees, brand recognition, intellectual property, etc. You simply follow the recipe or path of the last owner while looking for ways to improve.
When you start your own business you will need to find and acquire all those essential assets listed above plus plenty more. You may be debating which is more affordable and the answer is it depends. However, there can be no disagreement over which way is going to be easier (and decrease the time in which you bring in revenue).
Starting a business has been the American dream, however simply buying one may be a much smarter dream. Make sure you find the right business and success will be much easier.