What you need to know before starting

For those who want to become their own owner, starting a business can prove to be a good option. But be careful, the project is no less complicated and requires good organization to achieve its goals. Brief description of the major steps to follow.

The present circumstances have changed the outlook for trade recovery and above all it is necessary to examine the potential of the sector and also whether it is highly dependent on imports which may make it vulnerable in the short or long term and whether the customers have Inflation is given on its question.

1. Define a Project

Identify the field of activity and profession that attracts you to your acquisition, type of company, its size in number of employees and in business, its geographical location. Start learning about existing businesses and build a realistic project based on it. Don’t forget, too, that recovery can mean moving and new life. Agree with your family on this aspect and check that you will have all the necessary infrastructure regarding your personal life, especially if you have children who still go to school.

2. Find a Business to Take Over

This is a necessary but difficult step, requiring a lot of passion and patience, and the fact that there are competitors. In France there is usually only one company for every 5 buyers, but this depends on the region concerned. To achieve this, call on specialized networks to connect sellers and buyers, get help from people near you, take dedicated training courses for takeovers, attend dedicated trade fairs, companies for resale on the Internet. Search for or contact the Registry of the Commercial Court. Here’s how to find out which companies should close.

3. Meet the seller

Once you have found your rare pearl, make an appointment with the seller as soon as possible to weed out your potential competitors. This is an important meeting where you have to make a good impression and explain your personality to the salesperson. It is better to fix this moment at the convenience of the seller and go there alone with the presentation sheet of your project. During this meeting you’ll need to know everything about the business you’re interested in: identify the seller’s motivations, whether or not he’s the decision maker, what he’s selling (goodwill, property, etc.), whether his Have associates, have employees aware of the process, inquire about a brief history of the company and provide an update on customers and competition. Definitely don’t hesitate to ask to visit the company to evaluate everything (premises, staff, etc.).

4. Diagnose the Business

If the meeting with the vendor and the visit to the premises were favorable to you, then initiate the diagnosis of the company that is to be taken. Begin by cross-checking the information collected from the seller, which you may find on the Internet, in documentation centers, or in a company presentation file that you can ask the seller for. In particular, take stock of the products, competition, customers, accounting, human resources, legal side and the safety and environmental aspect. If nothing slows you down as a result of this cross-checking, you can force an audit firm to conduct an acquisition audit. Also take this opportunity to evaluate the company in terms of value, that is, both the cost of purchase, but also its future value after the acquisition.

5. Find Funding

If you agree with the seller and sign a memorandum of understanding, it is time to find financing for your project. You’ll need to bring in 20 to 30% equity in your recovery, which will be proof of determination for your donors. Whatever the case, it is hardly worth investing 100% of your assets in company acquisitions to mitigate risk. For the rest, you can use a family loan, appeal to investors, or apply for a loan from a bank. Once the sale is made, you will be the owner and benefit from the position of business manager. It is better to leave a transition period where buyer and seller will work together, exclusively and exclusively for employees.

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