Do a Self Assessment Before you Buy a Business

Self Assessment - A List of Things to Consider When Buying a Business

Hobbies, interests, talents, and skills are a good source of inspiration for the types of businesses you might enjoy and in which you may have some knowledge. Here are some questions to ask yourself before you buy a business:

Do you want to be an Absentee Owner or run the business yourself?
Remember, not all businesses "lend themselves" to absentee-ownership conditions.

Have you carefully determined your minimum income requirements?
How important is generating personal income from the business to you?

Do you want to manage a large staff or prefer non-personnel intensive?
Do you consider yourself a "people person?" Some people shun or fear taking management responsibilities.

Do you enjoy (and are you comfortable) supervising and motivating others?
If not, consider businesses which are not labor intensive.

How much importance do you place on high growth or expansion?
Are you very concerned about operating a business that has full potential to grow and continue expanding into the future? Or, would you be satisfied to maintain a business at its current level of operation?

How important is high staus or unpretentiousness of the business?
Is it important that you own a business that has a name, product, service or asset base which will project a certain image? Or, would you be happy with an unpretentious (or even undignified) business as long as it was profitable and met all of your other requirements?

Do you require time freedom or have issues about the kinds of hours involved in the business you choose?
Is it important that you own a business which allows you to "come and go" as you please? Or, would you be satisfied with a business that required fixed hours? If time freedom is really important, avoid a franchise business that requires owner-involvement and specified hours of operation, as well as certain retail businesses which require that the owner be available to serve the customers.

Will your family be involved?
Is it important that you own a business where you can employ other family members? Are you wanting to create a certain number of jobs for your family members or close friends? Do your family members really have the needed skills and qualifications to help you succeed with the business? Are they willing to make the same sacrifices you are making?

Does it matter if the business has travel requirements or do you prefer not to travel?

Do you want a business in which you would need to learn a great deal or prefer one in which you already have knowledge and experience? 
Are you willing to acquire a business which would require that you learn new skills, new businesses "buzz words" new techniques and procedures? Or, is it very important that your business be one with which you are already quite knowledgeable and experienced?

These are the kinds of questions you should ask yourself when you are ready to buy a business.

This information was provided by Rose Stabler, Managing Partner at Certified Business Brokers in Houston, Texas.

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