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Considerations to Make Before Buying an Existing Business in Illinois

Posted on in Buying or Selling a Business

IL business lawyerBuying a business can be an important milestone in someone’s career and personal life. In some cases, buying a company that is already established can be very appealing and make the owning process much smoother compared to starting a business from the ground up. However, before a potential buyer makes any major decisions, there are many business and personal aspects that they should take into consideration.

Reasons for Wanting to Buy a Business

There are many reasons people opt to buy an already existing business instead of starting a business from scratch. Avoiding the challenging startup period can provide pre-established benefits including the company brand and identity, building or office space, customer base, vendor and supply base, and management processes.

While buying an existing business poses several advantages, a potential purchaser should also consider why they want to buy a particular business. When buying a business, it is in the purchaser’s best interest to seek out a business that aligns with their interests and ambitions. Generally, a company will likely be more successful and innovative if the owner has more familiarity and knowledge of the business’s products, services, target market, and trends.

Other factors that may play a role in deciding why to buy a specific company may include the company’s location, size, industry, and lifestyle that may accompany it.

Why Is The Business for Sale?

In an ideal world, someone who is hoping to buy a pre-existing business will find a company that suits their interests, goals, and preferences. The next step would then be to determine why the business is for sale. This is a crucial part of the process as certain reasons may lead to otherwise unexpected challenges for the purchaser. These reasons could greatly impact the purchasing decision.

While a business owner may wish to sell their business strictly for lifestyle changes such as retirement, more worrisome reasons may be involved that buyers should be aware of. Potential purchasers should fully understand the company’s liabilities, including any previous or threatened lawsuits, bad blood between landlords or vendors, pending government investigations, unpaid claims, and anything that is likely to cost money to rectify. Other circumstances that may lead a business owner to put their company up for sale include a poorly developed business plan, location issues, brand problems, and inventory difficulties.

Contact Our Wheaton, IL Business Law Attorneys Today

Purchasing an existing business may seem like the safer route to business owning, however, it is accompanied by its own concerns and obstacles. Individuals who are looking to buy such a company should take time to decide what type of business would work best for them. Additionally, when they find a business they are interested in purchasing, they should familiarize themselves with what challenges may lie ahead to run that particular company.

Buying a pre-existing is not always a simple process. Due to the numerous contracts involved that will need to be drafted and negotiated, among other reasons, it is highly suggested to work with an attorney who can assist in the process. At Stock, Carlson & Duff LLC, our legal team can help you with numerous components of the purchasing and selling process of businesses including tax liabilities, conducting due diligence analysis, and the transfer of ownership agreements. To connect with a well-equipped DuPage County business law attorney, call our office today at 630-665-2500.

 

Sources:

https://www.nerdwallet.com/article/small-business/buying-an-existing-business

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