US Property : Buying a Business in the US

FAQ

1. What kind of business do I want to purchase?
2. How do I find a suitable business? 
3. When I purchase the business, what exactly will I get? 
4. What steps should I take to prepare to purchase a business? 
5. What else needs to be done?

1. What kind of business do I want to purchase?
   You need to make sure you’re not taking on someone else’s problems. If you have found a business that you think suits your needs, there are important matters to consider. Do you have the knowledge necessary to succeed? Do you have the necessary time and ongoing capital you will need to invest? In buying an existing business, you will have an inventory and a customer base, and you may find that finance is easier to obtain. However, inventories could be obsolete, current employees may be difficult, and debts may not be recoverable.
   
   If you are buying a franchise, ask for the U.S.’ Federal Trade Commission mandated earnings estimates or “Uniform Franchise Offering Circular” (UFOC) before completing any deal. Consider all other available franchises before making a decision. Speak to other franchisees about their experience. Do they get along with their franchisor? How was the training program? What kind of business launch and marketing support was offered? What did it cost to get the business to a break-even point?
   
   
2. How do I find a suitable business?
   Contact a business broker. Please remember that business brokers work for the seller, so you should not tell them anything you don’t want the seller to know. Not all sellers or business brokers will send you documents or financial details but you must insist on them. Don't be seduced by unaudited accounts or glossy marketing packages or brochures.
   
   
3. When I purchase the business, what exactly will I get?
   Are you buying the assets of a corporation or the corporation itself? If you plan to purchase the going concern and its stock, make sure you are aware how it was valued. If you’re not buying the premises ensure you know what the future rent and terms of the lease will be. Get an accountant's advice about the broker’s calculation of the business’ value. You’ll often get a reduction in the price. Over and above the cost of the business, ensure you factor in sufficient funds for your living expenses, overheads and legal, accounting and appraiser's fees.
   
   
4. What steps should I take to prepare to purchase a business?
   If you plan to move to the U.S., speak to us. We will advise you on your immigration options and then contact business brokers. Once you have identified a business, seek further legal and accounting assistance. You should not sign anything before taking legal advice.
   
   
5. What else needs to be done?
   We will assess all the legal concerns related to purchasing and operating a business. From licensing and permits, local, state and federal laws, insurance and tax issues, we will conduct a thorough review. Then, you and the seller may share the cost of an independent stock valuation. A good broker will arrange the stock valuation. We will negotiate an overlap period with the seller so that the seller remains on the scene. This will enable you to familiarise yourself with the business, employees, customers, suppliers and business practices.

No matter what kind of business you may buy, Bennetts can provide professional advice to help you make the right decisions.