There are a lot of questions to ask the seller. Each of them can be attributed to a particular area of business. Therefore, it is advisable not only to ask questions but also to check the answers received.
Understanding that all questions must be asked at the right time is important. If you’re on your first meeting with a salesperson, there’s no point in asking deep questions about the business. You will still have time to figure it out.
Why are you selling the business?
This question will give you an idea of the feasibility of the sale for the current owner. This question will not help you decide whether or not to buy a business, but it can provide additional leverage in further negotiations.
You can get information about the urgency of the sale, which will allow you to sell more at the seller’s price. Sometimes you can understand that the conditions for further support or the very process of buying and selling are important for the seller. As a result, you will receive more favorable offers for the speed of the transaction and additional bonuses.
Will you accompany the business after the purchase (for a fee or for free)?
No matter how good a business is, in any case, it strongly depends on the current owner: on his professionalism, competence, love for business, and financial and non-financial goals.
The most difficult stage for you as a buyer is the transition period. You must understand that no matter how big a business has shown in the past, this cannot guarantee the level of profitability in the future. Therefore, the most dangerous time for the buyer is the transition period. It lasts from 1 month to six months.
What asset do you consider the key in business?
Sometimes the value of the same asset may not be equivalent for the buyer and the seller. We can only guess what a valuable asset is. Sometimes it is because of this asset that we buy a business. Maybe that’s the way it is.
But it is important to see another point of view. This will help you both in trading and for further commercial activities. A key asset is something around which the entire process of negotiations and further re-registration should be built.
Spending a lot of time on secondary points makes no sense if you have reached your value in transferring the most valuable asset. And if your understanding of a valuable asset does not agree with the seller’s opinion, then this is a good reason to buy a valuable asset cheaply. Or, if possible, try to purchase it separately.
Tell us about the prospects and why you did not achieve this?
It can be said for sure that not every owner will tell you about all the risks that await you when checking a business or in further management. But we know for sure that each owner will be happy to tell you in sufficient detail about the prospects of this business.
Do you have described business processes or instructions?
For each staff unit, you will find a fairly large amount of instructions and regulations in any large business. And all the interactions between departments and departments can be seen in the described business processes and interaction schemes.