Entrepreneurship involves discovering and exploiting opportunities. In many cases, this involves the start-up of a new business entity. However, entrepreneurship can also involve acquiring a business. In the current economic times, many businesses are being put to the test, and in some cases, not doing so well. This can equate to a great opportunity for someone to come in and take over an existing business with a fresh perspective, strategy and resources.
A recent question posted to BusinessWeek addresses how to buy a struggling company. The key takeaways…Many businesses are available at bargain prices, but be cautious – do your due diligence!!!
One way to identify struggling business is through a certified business broker. However, another more fruitful option is via word-of-mouth (use your networks!). One last suggestion is to be creative --- for instance, you could offer to come on board for free in exchange for a share of the ownership. Or, you could offer to purchase a failing division of the business (not the business in entirety). Don’t be afraid to approach a business owner, but do be respectful as there are many emotions that are associated with running a successful and failing business.
Link for full article: How to Buy a Struggling Company - BusinessWeek