Do your homework before you buy Buying a business is a big decision — gather information first

By AMY HAMILTON Crowe Horwath

Looking to complement your current business/farming portfolio is an exciting position to be in and can also be one of the biggest decisions.

It is likely you will be investing a large amount of time, money, reputation and energy into this new venture. There are a few tips to improve your chances of success in getting this right, it pays to ensure that you have done your homework to look at all aspects of the business for sale, namely:

1. Identify the opportunities and strengths.

2. Look at the risks and problems and how they could be mitigated.

3. Consider the value of the business.

Buying a business is a lot about information gathering and self-assessment, making sure you are prepared as the risks are often large.

When looking to buy an existing business there are a few tips to aid in the success:

1. Decide what you are looking for, based on location, size, industry and lifestyle. These factors will help you to pinpoint exactly what type of This is likely if you do not have the necessary cash or have a financial backer. Once a purchase price has been settled you will have an idea of the finance requirements. There are several options here— business loans, seller financing, each with its own pros and cons.

5. Sales agreement. This is imperative once you have chosen a business, negotiated terms and have funding secured. Ensure you have your solicitor involved and that you understand the terms of the agreement before you sign.

Buying a business is a massive decision, however with the right process and support network you can help ensure the outcome is the right one.

For any further information please contact the team at Crowe Horwath on (06) 858-5540.

■ This information is general in nature and readers should seek specialist advice before making financial decisions.