Tuesday, 19 March 2013

Get Your Credit Report Before You Buy

Many have felt the desire to do something entrepreneurial. Few prospective business buyers take the time to map out a plan that will improve the probabilities of a successful business transfer.

By purchasing an existing business you can dramatically increase your chances of success.   Existing businesses have a proven track record of profits, they may have a well-known brand, name, location, product mix, etc., and an established customer base for immediate cash flow. 

If you are considering a decision is to buy a business you will need to take an honest inventory of their skills, knowledge and interests. You need to truthfully catalogue skills and talents that can be incorporated into a business.

Plus, you will need to know how much money you are prepared to invest and how much you expect to make. Typically, these two amounts are directly related to one another.

Part of this exercise is getting a solid understanding of your credit score. Whether your eventual purchase includes all cash, Vendor financing or Third Party financing your credit report will inevitably be requested. Knowing ahead of time the information is accurate can make or break a business transaction.

A recent article in the Windsor Star by Ellen Van Wageningen http://www.windsorstar.com/Check+your+money+report+before+others/8073031/story.html provides some great insight and information to consider before you buy a business.

At this point, don’t be too concerned if you’re unable to identify exactly what type of business you’re looking for. The more focused and realistic you are in your personal review, the more attentive you can be in identifying attractive business opportunities and eliminating businesses you’re not interested in.

Having a plan for executing a successful business transfer will help you stay on track, allow you to dedicate the time and energy necessary, and get you a successful business that is ideal for you. 

Do you have a small business question you would like answered about this article or others?
Bill Sivell is a salesperson with VR Windsor Inc. [www.vrwindsor.com] 519-903-7807, which sells businesses to buyers across Canada and around the world. His 14-year career includes diverse senior management positions in marketing, advertising, sales management and operations management. His blog appears every Tuesday.


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