For those in the process of considering a business purchase, the ASBTDC offers the following suggested Action Steps. These steps are intended to help guide you through the process and point you toward suggested information and tools.
Participating in the Buying a Business course will provide you with a good foundation as you proceed with purchasing an existing business.
Estimate the amount of funding needed for the project and consider funding requirements. Review "Can I Qualify for a Loan?" below and consider the realities of obtaining financing.
Obtaining information from the seller about the business is a very important step. This information can help in the decision-making process and will be required if financing is needed.
How will the business be different under your ownership? How will these changes affect the business? What would be the costs of such changes? Develop a written explanation of planned changes.
Develop income statement and cash flow projections based on historical performance, information obtained from the seller, and planned changes to the business operation under new ownership. Developing projections can help you determine whether or not the project is feasible and if you are still interested in moving forward with the business purchase. Training can teach you about preparing projections.
Arkansas residents - If you would like to talk with someone about the information you've obtained from the seller and about the feasibility of your project, the ASBTDC can assist you. To obtain this assistance, contact your local ASBTDC office.
Individuals planning a business acquisition who need financing should develop a loan proposal to communicate with potential lenders. A loan proposal provides lenders the information they need in order to decide whether or not to finance the project.
