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FAQ For Buyers
Why should I buy an existing business instead of starting one from scratch?
Buying an existing business offers immediate cash flow, an established customer base, trained employees, and proven operational processes. It reduces the risks associated with startups and allows for quicker scalability.
How do I know which business is right for me?
Selecting the right business depends on your skills, experience, interests, financial capability, and long-term goals. Archstone Business Brokers helps buyers identify businesses that align with their strengths and investment criteria.
How do I find businesses for sale?
We provide access to an extensive portfolio of businesses across multiple industries. Through our network, we also source off-market deals tailored to buyers’ specific needs.
How are businesses valued?
Businesses are typically valued using a combination of methods, including EBITDA (earnings before interest, taxes, depreciation, and amortization) multiples, discounted cash flow analysis, asset-based valuation, and market comparables.
What should I look for in a business before purchasing?
Key factors include financial performance, industry trends, customer base, operational efficiency, competitive positioning, and potential risks. Our team helps you conduct due diligence to make an informed decision.
Do I need prior experience in the industry I am buying into?
While experience can be beneficial, it is not always necessary. Many businesses can be operated successfully with proper training, strong management, or a transition period with the previous owner.
What is the process of buying a business?
The process includes identifying a business, signing an NDA, reviewing financials, making an offer, negotiating a Letter of Intent (LOI), conducting due diligence, securing financing, signing a purchase agreement, and closing the deal.
How long does it take to buy a business?
The timeline varies depending on business size, complexity, and due diligence. On average, a business acquisition can take 3-9 months from initial inquiry to closing.
How much money do I need to buy a business?
This depends on the business size, industry, and financing options. Buyers should have funds for the down payment, working capital, and acquisition costs. Archstone Business Brokers can guide you through financing options.
What financing options are available for buying a business?
Financing options include SBA loans, bank loans, seller financing, private investors, and alternative lending sources. Many business acquisitions involve a combination of financing methods.
What is seller financing?
Seller financing occurs when the seller agrees to finance part of the purchase price, allowing the buyer to make installment payments over time. This can be a great option when traditional financing is limited.
What due diligence is required before purchasing?
Due diligence involves reviewing financial records, legal documents, customer contracts, employee agreements, inventory, leases, and tax filings to verify the business’s health and sustainability.
Can I negotiate the purchase price of a business?
Yes, negotiation is a crucial part of the buying process. Buyers often negotiate price adjustments based on financial performance, liabilities, or market conditions. Our brokers assist in structuring favorable deals.
What is a Letter of Intent (LOI)?
An LOI is a non-binding document that outlines the key terms of a proposed transaction, including purchase price, financing, due diligence period, and contingencies before drafting the final purchase agreement.
Do I need a lawyer and accountant when buying a business?
Yes, legal and financial professionals play an essential role in reviewing contracts, structuring deals, and ensuring compliance. Archstone Business Brokers works alongside your advisors to streamline the process.
Will the seller stay on after the sale to assist with the transition?
This depends on the agreement. Many deals include a transition period where the seller stays on for training, introductions, and operational continuity to ensure a smooth handover.
Can I buy a business with a partner or investors?
Yes, business acquisitions can involve multiple buyers, investor groups, or private equity participation. Structuring the deal correctly is key to ensuring smooth ownership and governance.
What happens to employees after the sale?
Employee retention depends on the buyer’s strategy and the nature of the business. In many cases, keeping existing employees is beneficial for operational continuity and growth.
How do I protect myself from potential risks?
Conducting thorough due diligence, structuring the deal with contingencies, negotiating warranties, and seeking expert legal and financial guidance will help mitigate risks.
How can Archstone Business Brokers help me buy the right business?
We provide end-to-end advisory services, including business search, valuation analysis, negotiation, due diligence support, and closing assistance. Our expertise ensures you find the right business at the right price.