How to Buy a Business for Sale

Buying a business is a big deal, and knowing what to expect throughout the process can alleviate a lot of stress early on. Here’s a general idea of what your experience will look like as you move toward owning your new business.

1. Schedule an appointment. The first and most important step to buying your own business is connecting with the experts at First Choice Business Brokers. Our insight is crucial to creating a quality action plan that will make your business buying process a breeze.
   
   We’ll get the conversation started by discussing your unique wants and needs for your new business so we can determine exactly which opportunities are a perfect fit for you.
   
   
2. Understand your finances. Any business can be a large investment. Your Business Broker and any potential Sellers will need more than just your word that you have the funds necessary to make the initial purchase and run the business effectively. Many Sellers require upfront financial information from potential Buyers to prove you’re a qualified candidate.
   
   Whether you utilize loans, leverage your own net worth or borrow money from a supportive family member, informing your Business Broker of your financial situation will make the entire process run more smoothly from start to finish.
   
   
3. Keep your options open. First Choice Business Brokers have extensive knowledge of the businesses for sale in your desired markets, and they may show you options in industries you hadn’t previously considered or may not have even heard of. Trust your Business Broker and carefully consider all of the options presented.
   
   
4. Sign a confidentiality agreement. Non-Disclosure Agreements (NDAs) exist to protect the Seller from having their confidential information used in competing businesses and they’re commonplace in this type of sales process. Most Sellers will require you to sign one before sharing certain information. Don’t worry. Your Business Broker will help you fully understand the agreement before you sign.
   
   
5. Meet with the Seller. Now that you’ve nailed down your desired business, we’ll set up a meeting with the Seller so you can get the inside information on how the business operates and see the details for yourself.
   
   
6. Plan your next step. After meeting with the Seller, we’ll regroup to go over your thoughts on the business. You may request to view and validate the financials and other records as part of the upcoming due diligence process. This is where you’ll decide whether you’re ready to make an official offer.
   
   
7. Write your offer. We’ll provide a complete Purchase Agreement — the most comprehensive in the industry. We’ve designed these agreements to cover all bases, protect all parties and ensure issues like lease negotiation and employee management are taken care of in writing.
   
   This is also the step in which you’ll prepare an Earnest Money Deposit (EMD). That’s a check, usually the greater of $10k or 10% of the purchase price, which will be deposited with a third-party closing entity once the Seller officially accepts your offer.
   
   
8. Do your due diligence. We’ll present your offer to the Seller and, if they accept, you will start your due diligence phase of the sales process. You’ll be able to request and review items and information from the Seller to ensure everything about the business meets your approval.
   
   Remember, if anything about the business doesn’t feel like a fit for you, your offer can still be withdrawn and your Earnest Money Deposit (EMD) can be returned.
   
   
9. Sign a release. Everything looks good, your contingencies have been met, due diligence items have been provided — it’s time to sign a release and move on to the final step of the sales process.
   
   
10. Finalize your purchase. It’s the moment you’ve been waiting for! Let’s get you started in your new business. We’ll have a third-party entity — which could be an escrow or title company or a transactional attorney — prep the final transfer documents and obtain clearances for taxes. This is done so that you know you’re purchasing a business that’s free and clear of all encumbrances. From there, you’ll be ready to embark on your new business adventure.
    
    Congratulations! You just bought a business!

When you buy your business with First Choice Business Brokers, the sales process can be just that simple. Get in touch with us to start your journey today.