What Are The Advantages Of Buying An Existing Business
What Are The Advantages Of Buying An Existing Business
07 December 2023
If you are in a position to buy a business, you may be wondering whether it is better to start from scratch or purchase an existing business. While starting your own business can be exciting, there are many advantages to buying an existing business. This article will list 10 advantages of buying an existing business so that you can make an informed decision when it comes to your entrepreneurial journey.
Buying an existing business is much less riskier than starting your own business. The startup failure rate for newly launched businesses is extraordinarily high, particularly in South Africa. According to News 24, 70-80% of small businesses fail in the first five years because they run out of cash.
Buying an existing business provides you with a steady flow of income and an established customer base, which can help mitigate the risk of running out of cash and failing.
Solid Business Plan
A solid business plan is one that has been tested and proven to be successful. With an existing business, the business plan is already in place, and you can see the results of it. This means that you can assess the current strategies and make necessary changes to improve or expand upon them.
Established Suppliers and Vendors
Another advantage of buying an existing business is that the previous owner has already established relationships with suppliers and vendors. This can save you a lot of time and effort in finding reliable suppliers and negotiating deals. Plus, these established relationships may come with discounts or other perks that can benefit your business.
Easier Access to Financing
When buying an existing business, you can use the existing assets and cash flow of the business as collateral for financing. This makes it easier to obtain loans or attract potential investors, as the business is already established and has a track record of generating revenue.
Buying an existing business also provides valuable learning opportunities for entrepreneurs. You can learn from the previous owner's successes and mistakes and use this knowledge to improve the business.
For instance, if you're buying a Salon business and do not have that much experience in the field, you can benefit from the previous owner's expertise and learn about industry-specific challenges and opportunities.
Existing Marketing Strategies
Marketing is an essential aspect of any business, and buying an existing business means that you're also buying the existing marketing strategies. This does not mean that you have to stick to the same strategies, but you can use them as a starting point and then tailor them to your specific wants and needs.
Buy An Existing Business Today!
The advantages of buying an existing business are quite clear. It's a great way to enter the world of entrepreneurship without starting from scratch. You have the opportunity to acquire an established brand, loyal customers, experienced employees, and proven systems and processes.
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