Buying a business requires passion, courage, research and planning to succeed. There are although no success guarantees provided, however, it is most likely that buying a small business can prove to be a rewarding decision, provided a careful analysis is conducted. It is imperative to keep in mind that buying a business is like a lifestyle change as the entrepreneur looks for stability, security, income, flexibility, privacy, decision making etc.
Buying business in Melbourne is easier as the city has the highest number of businesses up for sale as compared to other cities in Australia. The city is the residence of many immigrants thereby adding to a lot of diversity. The average population increases by 2% every year, and also the city is ranked as the most livable city of 2014 by Economic Intelligence Unit (EIU). Melbourne also happens to be the second-largest industrial center of Australia, indicating that there are several opportunities to buy businesses.
Buying an existing franchise is the most popular option in large cities like Melbourne. The city also has several brokers, real estate agents and listing sites that suggest buying techniques along with providing personalized services. Needless to state that competition too is stiff in Melbourne, however not restricting the spirit of people to buy or sell businesses.
The government in Melbourne provides incentive programs for the first time buyers in order to encourage the said practice. The two most favorable options offered by the government to the first time buyers are Small Business Start-Up Grants and New Business Start-Up Grants. Before applying for either of the above, the entrepreneur needs to submit certain documents like a business plan, budget, proposal, cover letter etc.
A few important aspects to be covered by the entrepreneur are:
Compare: It is needless to state that the various options available to be bought must be compared in terms of experience, the nature of the business, cash flows, future growth opportunity and existing resources. The financials are to be carefully assessed and compared as all entrepreneurs enter the market with a vision to be a long term player. Also, the financial records are a good indication of how well the business has been doing in the past few years. At the same time, it should be remembered that past records are history, therefore only an inference is to be drawn. The past few years’ business performance is to be studied to analyze the trend. Statistics can be studied basis the data provided by Australian Bureau of Statistics (ABS) for the business involved in Hospitality, Retail or Tourism etc.
In-Depth Know-how: An in-depth study is to be conducted on topics like reasons for the existing owner to sell the set-up, how long the business has been running, how long the present owner has owned the business etc. Answers to these questions will help in assessing the overall health of the company.
Legal Assistance: Hire a legal consultant who can structure a transaction after addressing all the legal issues. Focused lawyers having experience across industries can help conduct the transaction smoothly. At the time of buying a business, it is essential to seek professional advice from qualified accountants and legal counsels. The legal counsel will ensure that a license is procured wherever necessary.
All the aforementioned will help before identifying and finalizing the business set-up to be invested in.