If you are looking for a profitable, well-run business to acquire, you are not alone. Right now, there are not enough businesses for sale to meet buyer demand, as reported by a Market Pulse Survey in early 2017 and sponsored by the IBBA (International Business Brokers Association) and M&A Source. The survey was conducted with support from the Graziado School of Business at Pepperdine University.
There is an unusually large volume of high-caliber buyer activity in the market. Not only are there not enough businesses on the market to satisfy the number of buyers looking for an acquisition, there's much more capital available than there are companies to buy, as indicated in Deloitte's Perspectives Report.
As soon as a solid business goes on the market we see well-prepared ready-and-able buyers competing to put themselves in front of the Seller. Buyers must be prepared and ready for the competition and be able to move quickly.
The following checklist will help you achieve acquisition-ready mode.
1. Understand the buying process
2. Get prequalified for financing from a SBA Preferred Lender (PLP) or other financial institution that specializes in acquisition financing.
3. Target businesses that suit your skills, background, lifestyle, knowledge base, natural talents, and your budget.
4. There will be financing costs, legal and accounting expenses for professional assistance during due diligence, and closing costs
5. It is important to recognize that lenders, landlords, and others who will be a party to your eventual business acquisition will require personal and financial information to make sure you have the requisite financial and experience qualifications to meet all contractual obligations.
6. Have your professional advisors ready, such as your CPA and/or Attorney to help you through due diligence. Make sure they are experienced business-transfer professionals.
7. Let the Seller know that you understand deadlines and are ready and able to close the deal.