How to Buy the Right Business for You

2misi.com

There are many proven steps that can help you determine what is the right business for you.
Put together your list of five golden rules of what any business you buy MUST have in place. Think about this and be specific.

As an example, here are my five golden rules for any business I consider buying:

Rule #1:	It must be a sales and marketing driven business - that's what I do best.
Rule #2:	It must have some element of exclusivity either in the product or within a territory. If not, I have no point of difference to offer new clients and maintaining current clients will always be a risk.
Rule #3:	The product or service must be a high margin item. This way, it's simply a matter of time, persistence, and sales savvy (my strength) for me to build the business. Plus, the margins will allow me to try new, creative ways of building the business.
Rule #4:	There must be a built in demand for the product or service. I've learned the hard way that trying to create demand is far too expensive.
Rule #5:	I do not want to sell anything that competes solely on price. There's no long term viability in that business model.

These are my rules. Unbreakable. Non-negotiable - no matter what! Guess what? They are bulletproof. When I find a business with these in place, and there are plenty, I am always going to be successful. You can certainly follow mine however; it is far more important that you tailor these to your specific strengths and situation.

I must admit that I do have a sixth and seventh rule, but they are negotiable: I like businesses that don't have a lot of employees and I prefer, if possible, to have a business where there are repeat orders from all clients. But again, I will sway from these two but never, ever from the other five.

Helpful hint: you probably won't come up with five today. Your list may even change a bit during your search. As you visit different businesses, speak with sellers, and conduct your research, you may discover certain things that are added or deleted from your list. That's OK. However, getting this list down as soon as possible is fundamental to your success!

The right business for you is one that will thrive from your strengths and not suffer from your weaknesses. Take a long, hard look at yourself. Picture yourself in the business. Of paramount importance is that you must perceive yourself as enjoying the business. If you can't, then there's just no way that you can be successful. The business that you choose has to be one that you'll be proud to own.

Another key factor is to avoid falling in love with the product; rather, you must fall in love with the profit and the lifestyle that it can deliver to you. 

Stay Focused - Don't Get Discouraged

During the search phase, it's easy to become discouraged by the vast number of available businesses. Don't get overwhelmed. Approach this methodically. If necessary, rule out the ones that you don't want. For example, if you're not interested in a gas station, restaurant or convenience store, you'll rule out 50% of all online listings. Search through listings pay attention to the profits, not just the selling price. Understand that listings do not always portray the whole picture. Contact sellers and arrange meetings. Prepare the questions you need to ask. You cannot buy a business from a listing. Visit businesses. With each meeting you'll get closer to knowing what is and isn't right for you.

http://www.2misi.com/article/2012/06/how-to-buy-the-right-business-for-you