There are Ten Proven Steps You Must Follow When Buying a Business.
If Not, You'll End Up Buying the Wrong One!

Determining What Business is Right for You Has To Be Your Number One Priority!

Perhaps the most crucial element when buying a business is choosing the right one for you. There are thousands of businesses listed for sale; many of them overpriced and with plenty of problems. Moreover, the average business buyer claims that figuring out what business is right for them, is both their number one concern, and the number one reason why so many people never complete a deal.

Buying the right business for you is the single biggest factor in determining whether or not you'll be successful in your venture.

Most people spend endless hours searching business for sale listings trying to determine what business is right for them. Unfortunately, this is the wrong approach. Plus, it's usually a major waste of time.

The key to your success is to first determine what type of business, in what particular segment or industry is right for you. Then, finding it is easy!

The Business Buyer Toolbox™ will eliminate this concern for you. How? Included in the program is our proprietary self-evaluation application: The RightBiz Profile™. This online questionnaire is a series of questions that will perform a complete analysis of your strengths, weaknesses, experience, interests, and financial situation. The data is then analyzed using our proprietary software and you'll immediately receive a comprehensive report that will outline what industry and business type is right for you.

You will see how you rank between service, manufacturing, retail, and wholesale/distribution and why. A detailed commentary will accompany your results. This is the first step for you to follow in The Business Buyer Toolbox™ and it will immediately provide you with crystal clear focus on what type of business you should be searching for next. Click here to see how it works.

Focusing Your Search and Weeding Through The Garbage Businesses

There are tons of businesses for sale online. Once you know the right type of business to look for, you can review all of the appropriate online listings. If you've done any searching you know what a hassle it can be to view a listing, print it out, review the details, compare it to other similar businesses, email the seller/broker, wait for a reply, perform a valuation, etc., etc., etc.. The paperwork and follow up is astounding.

The Business Buyer Toolbox™ actually automates this entire function for you and without any paper. The application is fully integrated with all major business for sale databases (Bizbuysell, Bizquest and Mergerplace). On the business details pages of the major websites, you'll find a button labeled "Download Listing". Simply click on this button and the listing details are immediately transferred into your personal database within the program.

Properly Comparing Business Listings to be Certain It's The Right One at The Right Price in the Right Industry at the Right Time!

Once the listing is in your database, you can immediately compare all of the details such as sales, profit, years in business, financial data, and numerous other factors to other similar businesses. In fact, The Business Buyer Toolbox™ has a built in database of over 6,000 sold and for-sale businesses to pool the comparison.

The other really neat function is that you can compare each business you have in your database alongside one another to really see which are the ones to keep, and which to toss, or simply, which to prioritize, or what details need further clarification from the seller.

The only way to hone in on the right business is to compare it to others and the Compare Listings function in The Business Buyer Toolbox™ does it all for you!

Managing the Huge Number of Details Involved in Search Process and Initial Investigation

With thousands of businesses for sale, especially online, the task of managing the search phase itself involves tons of little details to be covered: You're going to find yourself sifting through each listing, printing or archiving them, noting your questions, contacting brokers/sellers, logging their responses, detailing further questions to be answered, researching the industry, competition, and the marketplace. This is all BEFORE you even visit the place.

Without a systemized approach to manage all of these details, you'll find yourself to be disorganized and not in control of the process. As you can imagine, you don't want to overlook anything while conducting the preliminary evaluations to be done at this stage. If you do not manage the search effectively you can easily overlook an important point that will come back to haunt you later on.

The Business Buyer Toolbox™ actually eliminates all of the paperwork and organizes the search for you so you can focus your attention where it needs to be: locating and analyzing each potential business! If you've spent any time searching or contacting sellers, maybe even getting into negotiations, you understand how difficult it can be to remember all the little things that need to be checked out and handled to successfully complete a transaction.

With this application, all of the notes for each business are housed in one password protected location for easy and immediate access by you from any computer. Everything you need to know and do is always at your fingertips.

When Investing Your Money, it's not who you know, It's What You Know

Knowledge is the key to making any good decision. There's a lot at stake and this is one decision you absolutely must get right the first time. The consequences of buying the wrong business can be enormous. While buying a business can prove to be the best financial decision you ever make; the same holds true if you buy the wrong one. When buying a business, and especially if you haven't done so before, your entire success hinges on whether or not you have access to the right information.

Within The Business Buyer Toolbox™, there is great information, proven strategies, and expert tips extracted from the world's most widely used reference resource and strategy guide for buying a business: How To Buy A Good Business At A Great Price©. This program literally takes you through everything you need to know, how to prepare, and what to do specifically for each important step of the buying process. You'll learn exactly what to do in each situation, the negotiating strategies to use, and key points to protect yourself so that you're absolutely certain you buy a rock solid business that can become great under your ownership.

As an example, there are 36 critical questions to ask the seller of any business. Each of these will be clearly outlined for you along with the answers to look for and what to be on guard for that can trigger possible "red flags".

When you go to meet with a seller you'll be armed with industry data, financial spreadsheets, valuation models, and proven strategies so they will quickly realize that you won't miss a trick. One of the most important things that any successful business buyer knows is that in order to get a great deal, you have to impress the seller.

As an example, do you think they will finance the purchase if they don't believe you can grow the business? Of course not. But on the other hand, when you impress them with your knowledge and business savvy about buying a business, they'll agree to unbelievable terms. This has been proven over and over and over again!

You'll know the ten key components that any business must have in place for you to consider purchasing. These Ten Commandments are a cornerstone of the program How To Buy A good Business At A Great Price© and have been cultivated from over 10,000 small business investigations and purchases.

Valuing The Business To Completely Avoid The Chance of Overpaying

Part of the challenge when valuing a business is that many people focus solely on the raw historical financial data. While this may be fine to get a limited overview of what the business may be worth, it does nothing to determine the value of the business given all of the various peculiarities of that enterprise. Imagine you are evaluating two similar businesses generating the same sales and profits, a traditional valuation method would value them at or near the same price.

What if one of them has a client that represents 40% of its sales, while the other has no single client representing more than 5% of the business? Surely, the one with the high customer concentration issue is worth less. After all, if that client leaves after you take over, you could be out of business. Or, what if the business relies on location to generate sales. One business has a two year lease and the other a ten-year lease? Obviously, the one with the longer lease is worth more..right?

Or, what if one deal includes substantial seller financing while another is an all cash deal. Should this be part of the valuation? Of course it should! What about your investment? Don't you want to know how much you can expect to generate percentage-wise on your investment?

The problem is that traditional valuation methods don't consider these factors and these are just two examples of at least 60 critical factors you need to consider including inventory, condition of equipment, the deal structure, the impact that the departing seller may have. Supplier contracts, etc. These are all points specifically addressed by the valuation models you will use in The Business Buyer Toolbox™.

The Business Buyer Toolbox™ includes two proprietary valuation formulas that have been used to determine the right price of thousands of successful business acquisitions. There are two critical components to a business valuation: To determine the potential return on your investment and second, to get a true picture of what the future profitability of the business will be after you take over.

The VIP MethodT (Valuation Is Personal) considers YOUR personal investment criteria, your desired return, the deal structure, debt servicing, loan term, cash options, etc. It will then compute a valuation based on what the business is personally worth to you in order to achieve your required return.

The DBA MethodT (Diomo Business Assessment) analyzes all of the businesses strengths, weaknesses, potential problems, recent trends, future industry expectations and other pertinent details about the business that you will encounter after you take over. It weighs all of these ratios and then factors this score with the financial data and provides you with a valuation that you can count on to paint a true picture of the future viability of the business.

Negotiating - Knowing Exactly What To Do To Get A Great Deal

When you know as much as the experts do, you cannot even imagine the kinds of deals and terms you can negotiate. Inexperienced buyers overpay for businesses and wind up agreeing to deals that pale in comparison to what a savvy business buyer can negotiate. In a typical small business purchase, there are 36 key elements to negotiate in the deal. Done right they will make the difference between success and failure. Certainly there are key clauses that are needed to protect yourself that any attorney can handle but the real guts of the deal encompass issues that only an expert will know. You'll have access to every one of these "insider secrets".

On the legal side, The Business Buyer Toolbox™ contains templates, specific clauses, and documents to use that will save you thousands of dollars in legal fees.

Once you get serious about a particular business, you will find that our Message Board will be a great tool for you to get answers to any particular questions you may have or to provide you with a second set of eyes when evaluating a particular opportunity. You can read situations that others have encountered and even pose your questions to Richard Parker, author of How To Buy A Good Business At A Great Pricec who is considered to be the world's foremost expert on small business acquisitions.

Getting the Money You Need to Finance the Deal

Getting financing for a good business is possible but the deal terms available are so varied that you may wind up penalizing yourself and the business in the process. Most inexperienced buyers are prepared to put up their home and other personal assets to secure financing which is not the right way to go about doing this. While there may be government programs available, these require rock solid personal guarantees and collateral.

On the other hand, if you know how to configure the financing package and presentation, you can avoid this situation. When it comes to financing the purchase, knowledge is crucial!

When financing the business you have three choices:

• Pay all cash - that would be craziness by the way!
• Seller financing
• Third party financing

Let's forget about an all cash deal; it doesn't make sense.

Insofar as seller financing, you'll learn specific strategies from How To Buy A Good Business At A Great Pricec that will convince any seller to finance a good part of the purchase. In fact, 91% of the people who use the program get seller financing.

While there's always a way to arrange financing for a good business, lenders want to be certain that you have what it takes to be successful. Whether they are a bank, or outside investors, they'll want to know that you have a very well-thought out plan to manage and grow the business. The key document they rely on is the business plan that you will present to them. This is the document that is your bridge to the money.

One of the most incredible functions of The Business Buyer Toolbox™ is that as you enter the business data and log the answers to seller questions, it simultaneously populates parallel fields within the application and automatically compiles your business plan. How's that for information technology!

Due Diligence - Uncovering Every Problem Before You Buy

The due diligence/inspection phase is the time when you'll have access to the company's books and records. It's also the time when most inexperienced buyers make fatal mistakes because they focus all of their attention on the company's financials. While investigating the financials is very important, that's the easy part. Why? Because numbers don't lie; sellers do!

Even if someone is "cooking the books" a good accountant will uncover it. Also, the past financials tell you nothing about the future.

A proper due diligence period goes way beyond the financials. You also need to investigate the assets, the customers, the suppliers, the employees, the competition, the market/industry, the sales strategy, marketing possibilities, contracts, legal issues, and on and on it goes.

There is a lot to do and precious little time to do it.

The Business Buyer Toolbox™ includes a 125 point due diligence checklist that covers everything you must check out during this crucial stage of the business buying process. You'll learn how to negotiate an extended period to complete your review thoroughly and you'll have all of the necessary resources by your side to complete a flawless investigation.

Deciding Whether It Makes Sense to Buy the Business or Walk from the Deal

If you don't follow all of the steps above, then buying a business can be a huge leap of faith. But, when you go through all of the steps properly, and arm yourself with the right tools and information, then you can easily eliminate any major risk. After all, if you've identified what business is right for you, you've combed through different opportunities, organized your data, got answers to all key questions, performed proper valuations, negotiated a great deal, compiled the business plan, and investigated every part of the business, then making the decision to buy is easy.

It's only when you don't complete these phases that you can, and probably will make a very costly mistake.