Skip to main content

Due Diligence Before Buying and Existing Business.

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.



Disclaimer: The contents of this website are of general nature and not intended to be a substitute for legal advice or the formation of a lawyer-client relationship. In order to be properly represented, please contact your local professional. In addition, the information given on this web site has been composed by a New Jersey attorney practicing exclusively in New Jersey. None of the information contained herein should be deemed to apply in other states, nor should this website be construed as an attempt by the author to practice law in any state other than New Jersey. If you have any question regarding this website please contact our office directly at (201) 880-5563.
ADVERTISEMENT: This website contains attorney advertisement within the meaning of the Rules of Professional Conduct governing the practice of lawyers in the State of New Jersey.  This website is considered an “advertisement.” Before making your choice of an attorney, you should give this matter careful thought. The selection of an attorney is an important decision. If the representations made on this website are inaccurate or misleading, you may report this to the Committee on Attorney Advertising, Hughes Justice Complex, P.O. Box 037, Trenton, NJ 08625.

Comments

Popular posts from this blog

Establishing a Domestic Partnership for Estate Planning Purposes

Establishing a Domestic Partnership for Estate Planning Purposes For unmarried couples, it is important to have proper estate planning documents to have legal standing to each other. The Domestic Partnership Act established domestic partnerships for same sex and opposite sex (age 62 and older) nonrelated partners.  Couples 62 years an older that want to establish a Domestic partnership need to establish the following criteria: ·Share a common residence in New Jersey or in any other jurisdiction provided that at least one of the applicants is a member of a New Jersey State-administered retirement system;·Both persons are jointly responsible for each other’s common welfare as evidenced by joint financial arrangements or joint ownership of real or personal property;·Both persons agree to be jointly responsible for each other’s basic living expenses during the domestic partnership;· Neither applicant is in a marriage or civil union recognized by New Jersey law or a member of another domest…

Planning for Children in Case of Deportation

The current immigration climate is tense. Undocumented people fear not only for deportation but also for the care and wellbeing of their children.  It is important that people that are undocumented make plans in the event that this situation takes place. Among the first things to be planned is the provision of care and supervision of minor children while the parents are in the process of the deportation.

It is important to keep all detail information of the child. If the child is an American Citizen, having their passports updated should be a priority. In addition, it is often suggested to create a power of attorney limited to the event of deportation. In this power of attorney, the parents should assign a guardian to take care of the child and allow permission to travel with the guardian. The undocumented person should also consider leaving financial provisions for the care of the child.
It is often recommended that the undocumented person carries information of their attorney or a l…

Invalidating a Contract under the Doctrine of Economic Duress

The doctrine of economic duress has significantly developed and expanded, in recognition of the ever-increasing complexity of the business world. Claims of economic duress in business litigation are becoming more frequent. Several courts, including the United States Supreme Court, have acknowledged that there are situations under which financial pressure may cancel an otherwise enforceable contract. See 13 S. Williston, Contracts, § 1603 at 664 (3d ed. 1970); United States v. Bethlehem Steel Corp., 315 U.S. 289, 62 S.Ct. 581, 86 L.Ed. 855 (1942); Hartsville Oil Mill v. United States, 271 U.S. 43, 46 S.Ct. 389, 70 L.Ed. 822 (1926).The definition of economic duress is set forth in Williston:1. The party alleging economic duress must show that he has been the victim of a wrongful or unlawful act or threat, and2. Such act or threat must be one which deprives the victim of his unfettered will. [13 Williston, supra, § 1617 at 704 (footnotes omitted)]

The courts in New Jersey have defined eco…