There are two ways to start a business.
Build one from scratch or buy one that’s already up and running. The first can be more time consuming and uncertain as you’re the one who has to discover out what works and what doesn’t. The second, while perhaps not the best solution for ‘bootstrappers’, offers some very real advantages to the new entrepreneur willing to invest their cash or find the finance.
However, no business, even the previously most successful, comes with a guarantee of future success, but an existing business does offer either proven it’s worth already or an opportunity for growth – given a little TLC. So, in an up and running traditional ‘bricks and mortar’ venture or an online business with an established record and infrastructure in place, at least removes some element of risk.
An existing business also has a history you can use to look back on what’s worked before … and perhaps more importantly, what hasn’t. This allows you to continue to replicate the profitable, and to discard the rest. In fact, the very reason you may be interested in a business in the first place is because you can see past mistakes and have a plan for putting them right.
You can also use the history of a business to forecast what’s likely to happen in the future. For instance, looking through a company’s accounts will give you a good idea of probable future running costs, something you would never really know beforehand when growing a new business from the roots up.
Get results sooner
Stepping into an existing business also gives you a little more confidence than with a start-up, since you’ll be able to draw on the knowledge and experience of existing staff, all of which should help make your learning curve less steep. And with staff, equipment, systems and hopefully customers, already in place, with you should be doing business faster than is possible with a start-up.
What’s more, you’ll also have an established presence in the marketplace so customers and clients are aware of you and what you have to offer, achieving the same with a new business takes time and certainly effort.
While you’ll want to revisit some areas of an existing business and put your personal stamp on them, you’ll have a framework from which to develop, so you won’t have to focus on every part of the business at once as you do with a start-up, giving you more time to concentrate on areas that generate sales and add value for your customers.
Of course, buying an existing business is a financial commitment, and even though one of the advantages of buying a going concern is that you may have been able to acquire the assets at a knockdown price, you will still want to limit your risk and financial exposure as much as possible. In which case you could consider buying online ‘business real estate’ instead.
Try the online option
In the ‘old days’ – not so long ago! – this wouldn’t have been an option, but for anyone thinking of becoming an entrepreneur, going online is a very cost-effective alternative to the traditional ‘bricks and mortar’ business.
Even if you are buying a ‘bricks and mortar’ business, you will almost certainly need to have an online presence where information can be found about you and your business and customers can purchase from an ecommerce shop.
Being online also offers great opportunities to promote your existing products and services along multiple channels, as well as enabling geographically distant consumers and those who prefer to ‘computer shop’ to buy from you. These days, having an online presence also means that every business potentially has a global audience.
The type of business you go for will dictate, of course, the level of investment required and your day-to-day involvement in it. So here, are four things you may wish to consider before choosing one sort over another:
One, with online businesses you won’t have to invest in expensive equipment, premises or staff – at least not until you’re really successful. That’s not to say you can’t spend big if you want to – high profile, established domains go for many millions – but you can start for much, much, less.
Two, you’ll get faster income generation from an online business since it should already be attracting internet traffic and converting it into paying customers and clients. Those are real enough numbers that you can count.
Three, scalability also means that you can develop an online business much more quickly than the traditional kind. You can do this either by concentrating on adding value to the original business, or replicating the same model in other market niches. So, even a little way down the line, you will have something of real value.
Four, by buying an existing online business, you may not have to invest the same commitment in time that you would have to with a traditional business. The nature of the online world means that once a business is set up, it takes much less effort to keep the machine ‘well oiled’ and working.
Of course, before buying any business you should always undertake the necessary due diligence to investigate any claims made by the vendor using appropriate legal and financial professionals to advise you as necessary.
Then, if what they tell you feels right, follow your instincts and get started in business – it’s the only way to build a rewarding and fulfilling future for yourself and ensure that you stay in control of your life at the same time.
But whether it's a real world or virtual business you’re buying, make sure you continue to keep learning all you can about online marketing and social media skills because what’s required to achieve success is continually changing.
Maite Barón is known as ‘The Corporate Escape Coach™’ for her work in helping professionals break free from the rat race to become New Entrepreneurs and business owners.
Also co-founder of The Corporate Escape Foundation™ ‘Business with Heart & Soul’, she writes widely on entrepreneurship, leadership, marketing and career transition.
Last year her book, ‘Corporate Escape: the rise of the New Entrepreneur’, became an Amazon Bestseller on its publication. You can download two free chapters of Corporate Escape: the Rise of the new Entrepreneur here.
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