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Buying Private Businesses

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04-19-2017 , 03:23 PM

BCI23

grinder

Join Date: Jun 2008 Posts: 569

Has anyone here bought a business you found on a website like bizbuysell.com or other similar business listing service? Curious to hear anyones experience, what went well, what didn't go well, landmines to avoid, things to look out for, etc? Feel free to PM as well.

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04-20-2017 , 12:51 AM

corvette24

banned

Join Date: Jan 2009 Posts: 1,020

I'm curious about this as well. Hoping for tons of replies.

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04-20-2017 , 07:32 AM

Pride of Cucamonga

adept

Join Date: Dec 2008 Posts: 1,150

Coincidentally I just finalized the sale of my business yesterday--whoohoo!

Contractually I'm required to stay on & train the buyers for two weeks, afterwards they have the right to ask (insist) that I stay on for an additional two weeks, but they have to pay me $xxxx/per week.

AMA

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04-20-2017 , 08:16 AM

jalexand42

Hypothetical Ubermonkey

Join Date: Oct 2005 Posts: 5,390

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Originally Posted by Pride of Cucamonga

General details? Type of business? Revenue? etc. Maybe you posted somewhere else, so I might be forgetting.

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04-20-2017 , 09:41 PM

rivercitybirdie

Pooh-Bah

Join Date: May 2012 Posts: 4,708

i had never heard of that site you mentioned or even that type of website.

but it was wildly entertaining. so thank you......

can i really buy gas stations in orlando for $50K? i assume there's debt attached and/or bs/lying involved.

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04-20-2017 , 09:45 PM

eastern motors

Carpal \'Tunnel

Join Date: Jun 2007 Posts: 9,213

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Originally Posted by rivercitybirdie

Leaking tanks could make insane liability

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04-21-2017 , 07:33 AM

Pride of Cucamonga

adept

Join Date: Dec 2008 Posts: 1,150

Quote:

Originally Posted by jalexand42

General details? Type of business? Revenue? etc. Maybe you posted somewhere else, so I might be forgetting.

For perhaps obvious reasons I don't want to share specific details on a public forum.

It was a retail kiosk in an A-rated mall. Not going to share gross sales or net profits, but I priced is SUPER aggressively (slightly less than 1x yearly net) as for personal reasons I needed a fast sale. Listed it with a business broker in Nov/Dec of 2016, had a few showings, and put it under contract in February 2017.

Quite frankly I did not think I would be able to find a buyer by the time frame I needed to be out, so the sale of the business was all gravy / "found money" to me.

Last edited by Pride of Cucamonga; 04-21-2017 at 07:36 AM. Reason: spelling

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04-21-2017 , 10:49 PM

ddlloo12

grinder

Join Date: Jan 2009 Posts: 535

bizbuysell is a good website but its basically a retail shop for other business brokers some of which are not very trustworthy. Use good due dilligence and check tax returns, etc.. Do not buy any cash businesses imo

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04-21-2017 , 11:17 PM

Pride of Cucamonga

adept

Join Date: Dec 2008 Posts: 1,150

Quote:

Originally Posted by ddlloo12

+ 1 if what you mean by the statement of "Do not buy any cash businesses" is basically this:

Make sure you verify declared sales & income based upon figures on federal tax returns, supported by sales tax paid, monthly deposits into bank accounts, etc. Basically step one in terms of due diligence is to pay someone to audit the business's books, bank statements, sales tax records, and tax returns for at least past 3 years.

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