For some entrepreneurs buying an existing business can be a less risky proposition. There are many good aspects to buying an existing business such as reduction in start up costs and inventory. There are also some downsides like business debt and issues with current employees and management, in addition purchasing cost may be much higher than the cost of starting a new business. This is why doing your due diligence before buying an existing business is very important.
Once you have found a business that interests you, it is important that you do your research. How much is the business worth? We always recommend our clients to get a professional to make that determination. Other examples of issues to consider are contract and leases, financial statements, property documents, customer lists, sales records, advertising materials, employee and manager information and contracts. You should also review the business tax return so you can assess profitability and tax liability.
Buying an existing business is not an easy task it is always recommended to get professional help of an attorney to review the legal and organizational documents of the business. In addition an accountant can help with a thorough evaluation of the financial condition of the business.
For more information please contact our office at 201-880-5563 or visit us at www.ruizdoolanlaw.com for a consultation.
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