What drives people to make a decision – to become an entrepreneur? There may be several answers. For example, you want to try things out and feel responsible. Or maybe you have fresh ideas long ago that can’t be implemented in your old job. Or, you’re just tired of working for someone and watching someone grow the business, and at the same time, you’re just dreaming of creating something of your own. Whatever the motivation, when you decide to become the captain of your ship yourself, you will face a significant decision.
Buy an existing one or build a small business from scratch? At this point, you need to compare the two options, and even then make a balanced decision.
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Starting a business from scratch
Where do we begin? What is an essay on a business management first of all? True, the small business owner starts with the idea. And then there’s the complicated and lengthy process of becoming your business. What are the difficulties in the process?
- Building a client base
- Adjustment of cash flows
- Investor search
- Marketing a new business
This is just a small list of difficulties that may arise when starting your own business. It can take a long time for your creation to make a profit. You should not forget about the psychological aspect as well – you must be fully prepared (both morally and financially) for all possible challenges. Of course, a thorough knowledge of business, marketing, and management is vital.
Before starting a business, you need to study the market for services and goods carefully. Will your offer be relevant in this region? Have you identified any potential buyers? Will competition in the chosen direction be high? Answering these questions will play a vital role in the startup phase of your business.
In the process of developing a business plan, you need to think about where to manufacture and store your goods. What kind of people you need to hire to run your business effectively and where to find them. Taxes, logistics, sales of products… You need to understand the basics – you will face many problems, additional questions, and troubles. And you have to be prepared for that. Yes, your business gives you independence. But at the same time, it is also a great responsibility.
Buying an existing business
Are you scared of the hassle of starting a business from scratch? Then buying an existing business is the best option for you. Let’s talk about the apparent advantages of this decision.
One day you become a business owner which already brings you profit. You don’t have to wait for the business to pay off. You don’t have to reinvent the bike – it’s already done for you. All the most difficult steps are completed, the system is set up, and it works. You have a ready-made client base and business reputation. By buying a small business, you can also own copyright or franchise rights.
But it sounds too smooth. Of course, there are some pitfalls here. The first thing that comes to mind when someone is selling the business is, why is he or she doing it? If a company brings in money, everything works, and there are no problems – why does a person give up on this? At this point, you need to be as careful and attentive as possible.
Hire some employees – an experienced accountant, banker, and lawyer. Advisers will help you thoroughly review all available information about your new activity. An accountant will evaluate critical financial indicators and performance. The lawyer will investigate all legal aspects of business operation, study the legal history of the company. You must be protected from the effects of the previous owner.
Buy a business is more expensive than creating a new one. On the other hand, attracting investors to an already running business is much easier than building a business from scratch. Are you scared about the unknown? Investors also are.
There are many nuances, risks, and other points that you should dig into. One way or another, the choice is yours.