FAQ - Business Investment made simple and low risk

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Buying a Business FAQ
- Why should I use this service?
  This is a cost effective means of buying or selling a business. As a buyer you pay no charges whatsoever.
  As a seller, you only pay once a potential buyer has shown interest. That payment remains in effect for 30 days and during that time any number of potential buyers can contact you at no extra charge.
- Due Diligence
  Please be aware that after the initial contact has been made it is the responsibility of both parties to carry out diligence. Please inform us of any suspicious behaviour.
- How to Value a Business
  There are many ways to value a business and basically the worth of the business hinges upon how much profit a purchaser can make from it, balanced by the risks involved. Previous profitability and asset values are starting points but intangible factors such as key client relationships, can provide the most value.
  The one we particularly like is the discounted cashflow method. However, this is a topic best discussed with your accountant.
- Why hasn't the seller got back to me?
  There are a couple of reasons why sellers don't, or take ages to reply. Mostly it is because it takes time to get to your enquiry and send the appropriate information through to you. This can also be hindered further if the broker or seller is out of the office or on holiday.
  You may also find that you are required to sign a confidentiality agreement prior to any further information being sent out. Please remember this is sometimes a critical requirement and it is often needed to protect the seller and the business being sold. If you put yourself in the seller's shoes, you might not want to send out all your financial records etc. to people you don't know (particularly your competitors) or you may only want the broker to release confidential information once you have spoken or met the potential buyer.
  Also, it's a good idea, when you enquire, to include as much information about yourself and why you are requesting the details of that business. This is so that you distinguish yourself from others who may not be as serious about the business as you are
  The more information you provide such as 'I have looked into finance and this business would be a viable option for me' or 'I am in a position now that if I find the right business I can move immediately', the more likely that your enquire will be given a higher priority.
  
  It can take up to one week before you hear from the seller in this way. You should therefore expect to wait for at least five working days before contacting us again. If you've still heard nothing after one working week please contact us with the seller's logon ID.
- What is the "Memorandum of Sale"?
  The Sale Memorandum is an outline of the business and provides a potential purchaser an overall view of its present structure and operation. This includes key financial information, such as sales and profitability. The Memorandum will also concentrate on positive aspects of the business, outlining possible benefits and future opportunities to a potential purchaser. It is important that the purchaser ensures a thorough "due diligence" exercise to ensure that the Company "is what it seems" before Completion takes place.
- What are "Heads of Terms"
  "Heads of Terms" is an outline agreement between a purchaser and the vendor. The Terms will usually provide straight forward details of what the purchaser is prepared to pay for the business and any Terms on which the sale is to take place.
- Will the seller stay in the business after it is sold?
  The amount of time that the seller will have to stay within your business after it is sold, is mutually agreed between both parties and often before the Heads of Terms are drawn up. If they offer to stay on with the business, this may prove a great help as their experience may be very valuable.
  Agreements will vary but the norm is 6 months and on a 2 to 3 day a week basis. Also, it may be preferable for them to act as a "Consultant" rather than as a Director/ employee.
- How can I pay if I don't want to use a credit or debit card?
  If you are unable to or uncomfortable with using a credit card, you can pay via cheque
- I have other questions. Who do I contact? Contact us by email: info@good2use.com
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